BIR in Singapore

Concern About Environment and Scrap/Waste Distinction

BIR president Jake J. Farber, Alpert & Alpert Iron & Metal Inc., Los Angeles, kicked off the convention by telling the general assembly that while the industry "is becoming widely recognized as one of the major solutions to the problem of environmental protection, it is paradoxically facing a major issue--the effects of ill-conceived environmental legislation on the collection, processing, and consumption of secondary raw materials. "Unfortunately," he added, "our commodities have been wrongly considered by misinformed legislators as waste. We should fight to change such legislation."

Farber promised that BIR’s main near-term objective will be to prove that scrap is not waste. "This premise must be the pillar of our industry and a theme which we must carry through the 1990s," he said. "It is vital to the future viability of our industry [that we] show legislators that the application of the same restrictive regulations on scrap recyclers as solid waste handlers will have a counterproductive effect on the environment. We have to show that our industry deals in valuable commodities which should be traded freely."

The BIR commodity divisional presidents took a major step in that direction at the fall 1989 meeting held in Munich when they decided to establish definitions to differentiate between scrap and waste. Austin Merrills, of Ireland Alloys Ltd., in Hamilton, Scotland, public relations committee chairman, developed two definitions, which were approved by the general assembly in Singapore. The new definitions are:

Secondary raw materials are redundant goods, by-products, or residues that are recycled for further use.

Waste includes redundant goods, byproducts, or residues that must be disposed of at a cost.

Farber stressed that another key to the industry's future is Design for Recycling. "We in the United States have been talking about this issue for more than a decade. The Institute of Scrap Recycling Industries (ISRI) has adopted this slogan and it plays a major part in ReMA's public relations messages. We must get this message across to manufacturers of new products and to politicians and legislators in all countries."

Environment and the Three Fs

At the environment committee meeting, chairman Michael C.E. Lion of Philipp and Lion Limited, London, outlined what he defined as the three "Fs" facing scrap processors and recyclers: fear, frustration, and funding. The fear is of the future for industry members due to the complexity and contradictions in legislation. "Our members genuinely fear for their future viability as industrial units," he said. "The costs and effects of implementing and abiding by many rules could drive them out of business," he added.

Frustration centers on the contradictions and continuing changes encountered by the industry in trying to plan and coordinate future requirements to meet the demands of legislation. "The degree of arrogance of those who legislate over us, and yet who are meant to be of service to society, is extraordinary," he charged, adding "It is nonsensical for them to continue to refuse to consult us."

Elaborating on funding, Lion said "the chance and opportunity for BIR to act as a pressure group on behalf of the recycling industry and to be taken seriously is only possible when the commitment of financial resources is available. ...We talk of these things, but we must go from lip service to reality."

Lion welcomed the appointment of Christine Massin as BIR's public relations officer and said it was a positive start toward dealing with the three Fs. "We can begin to develop a profile and lobbying strategy with regard to these matters to ensure that our side of the argument is seen, heard, and taken seriously," he added.

During committee discussion, Robert Lewon, LMC Metals, Richmond, California, urged that BIR fund a major public relations effort to promote the industry and to differentiate between scrap and waste. Although numerous delegates expressed the need for the international association to take offensive action in the legislative and environmental arenas, Lion's request for a show of hands in support of increased funding for such a program revealed little support.

Ferrous Full of Question Marks

Anthony P. Bird, Bird Group, Stratford-Upon-Avon, England, and president of BIR's ferrous division, reported that "in the beginning months of this year we have experienced a difficult market situation that varied in its intensity from region to region," adding that "many areas report there is a scarcity of good-quality material coming into their plants." Bird also noted that "profit margins have been squeezed compared with last year and most companies have been affected by increasing costs on the environmental front. Yet," he added, "without a doubt, there are ready markets on a worldwide basis for all of our products."

The steel industry saw continued growth worldwide last year, Bird said, particularly in Asia, where "the Japanese, Koreans, Taiwanese, and even the Chinese increased their production. I see no reason why there should not be good demand for most of the material that we produce," he added, "although it is going to be a year for belt tightening and for increasing the efficiency of our operations."

Noting the political changes in Eastern Europe, Bird reported that the "impact of the dramatic happenings in the Eastern Bloc is not yet clear. There are massive quantities of unprocessed scrap in these countries that will no doubt filter into world markets over the next several years." He concluded by saying he did not see a large influx of Eastern Bloc material onto the market this year, but that 1991 could be a different situation.

Reporting on the United States, Seymour Padnos, Louis Padnos Iron & Metal Co., Holland, Michigan, noted that the United States has "a very firm market for the near term." He also commented on the environmental exposure involved in handling postconsumer recyclables and said, "the future appears to hold a great deal more governmental regulation of our industry, and our survival may well depend upon the mood of Congress and the Environmental Protection Agency."

On a more optimistic note, Gunther Giffels, Thyssen Sonnenberg GmbH, Duisburg, West Germany, predicted that the steel industry in the European Community (EC) will see an increase in production to 143 million tons by 1995. "This shows a positive trend for the European scrap industry," he said, "but still makes it absolutely necessary to continue the Third Country export policy--to have total freedom of export by 1993."

Giffels added that one of the biggest problems left to be solved for the European scrap industry "is the aim of the EC to impute scrap under the legislation of waste." One important way to voice the distinction between secondary raw materials and waste, he suggested, is "to make allies with national governments and partners in the steel industry."

In a report on the ferrous situation in India, Ikbal Nathani, Nathani Steel Limited, Bombay, explained that although the Soviet Union was to ship to India 800,000 metric tons (mt) of heavy melting scrap in 1989, deliveries totaled only 230,000 mt. This year, a trade agreement between the two nations calls for an 800,000-mt shipment, he said, "but until now the supplies have been nil due to increased consumption in the Soviet Union."

Nathani also said that the Indian government would like local mini-mills to reduce their dependence on imports of raw material and to gradually step up their consumption of domestic direct reduced iron. Another change Nathani reported is in the Indian scrap buying practice. Prior to this year, he said, all scrap was purchased through the Government Canalising Corporation. In 1990, he predicted, 50 percent of Indian mini-mills' scrap requirements will be purchased directly against the mills' own direct or purchased licenses.

Shafi Aboobarker, Trade Ventures, Dubai, United Arab Emirates, provided a perspective on Turkey, where, he said, "steel mills are running flat out to full capacity" and steel scrap demand remains strong. Imports were 4.7 million metric tons in 1989, he said, predicting that 1990 figures would be even higher. Turkey still needs seven to eight cargoes in the short term, he explained, adding that some mills were still holding back on June purchases.

Santokh S. Labana, of the polymer science department at Ford Motor Company, Dearborn, Michigan, in a presentation to the ferrous division on "Recycling and Disposal of Waste Plastics from Automobiles," estimated that the "amount of magnetic fraction per vehicle received at the shredder will drop from 1,280 kg in 1980 to 1,050 kg in 1990 and will fall to 850 kg by 1995," adding that the plastics and rubber in shredder residue was about 100 kg per car in 1980 and increased to 135 kg in 1990. This, he noted, is because the amount of plastics used to manufacture North American vehicles increased from an average of 51 kg per vehicle in 1970 to an average of just over 120 kg in 1989. When asked about Ford's plans to Design for Recycling, he said a meeting was set to discuss this concept when he returned from Singapore. He also suggested the need for more dialogue between shredder operators and auto manufacturers.

Nickel/Stainless Situations Examined

Barry Hunter, Samuel G. Keywell Co., Port Elizabeth, New Jersey, who is chairman of the stainless steel and special alloys committee, started off his session by noting that U.S. stainless steel and related alloy producer business remains decent. "Margins, primarily due to the tremendously competitive nature of our businesses, continue to erode as we struggle to secure material," he added. "It would appear that the tremendous years of 1988 and 1989 literally cleaned up a great deal of obsolete scrap that was laying in our suppliers' yards. Prompt industrial scrap intake to date has not yet begun to reflect the continued demand for stainless steel finished product. In addition," he said, "we have seen, and apparently will continue to see, territorial expansions by major scrap processors, which also tend to cause price escalations since these new locations must express their position in the buying market."

Looking at the second quarter of 1990, Hunter said ingot production in the United States remained good, with scrap requirements keeping "abreast, thereby potentially reducing exports." Scrap recyclers have been pressured to produce tonnages that continue to shrink margins, he noted, adding that pricing to consuming markets reflects the London Metal Exchange (LME), in spite of an apparent shortfall of scrap supplies. "In other words," Hunter explained, "if the LME goes down, we will take less from consumers--if we desire sales--and have a difficult time in adjusting our buying accordingly."

Reporting on the current U.S. scrap market situation for nickel, ni-chrome, airmelt grades, super alloys, vacuum grade, corrosion-resistant alloys, cobalt bearing, titanium, and tool steels, Sidney Greenberger, National Nickel Alloy Corp., Pittsburgh, summarized, "it's very good to own good-quality alloy scrap." With it, in today's market, "you cannot go far wrong," he said.

The third and fourth quarters of 1990 will be "good, but not great," for these scrap materials, Greenberger forecast, "if the consumers have correctly assessed their ongoing business." In addition, he said, "there is a school of thought that the changes in Eastern Europe, Germany, and the Soviet Union will create an unprecedented boom in exports." However, he noted, although "this may indeed happen, it is doubtful for 1990--it may take several years." What is almost certain, Greenberger predicted, "is that the Soviets will be granted most-favored-nation status very soon." This will bring U.S. nickel prices more in line with European prices, he said, noting that "we can also expect to have an LME warehouse established in the United States, which would help to further stabilize nickel." Greenberger concluded his report by stating that "some very knowledgeable experts say that demand may make 1990 the third best year ever for our industry."

Graham Price, Cronite Alloys Limited, Sheffield, England, reporting on nickel/stainless in the United Kingdom, said a near withdrawal from scrap buying by British Steel Stainless contributed to losses in volumes, in prices, and in margins for stainless traders during the six-month period prior to the BIR conference. He said many have forecast for improving demand for nickel and nickel-alloy scrap in Britain as consumers' order books run up to the full level. The last time this happened, Price noted, prices for scrap rose freely. "I expect more control from the consumers this time around."

As a committee meeting guest speaker, J.C.M. Shih of Inco Pacific Ltd., Taiwan Branch, and Taiwan Nickel Refining Corp., Taiwan, provided an overview of the stainless steel industry in Asia. "The Asian stainless steel industry today is playing a significant role in the world stainless steel industry," he said. "We have seen a solid growth of the industry and we are very optimistic about its fast growth and future." He pointed out that the per capita consumption of stainless steel in 1989 was 16.00 kilograms (kg) in Japan, 21.41 kg in Singapore, 15.61 kg in Taiwan, and 8.7 kg in Korea, compared with 6.47 kg in the United States. Stainless steel melting capacity in Japan will increase 10.5 percent, he forecast, to more than 4.5 million tons, between 1989 and 1992. Cold rolling capacity is expected to increase 23.7 percent, to 1.2 million tons, in the same time frame.

Nonferrous Metals Division Discusses Specs, Market Conditions

Roy Mackie, former editor of the Singapore Business Times, spoke on "Trade and Business Contacts in and With Singapore" at the nonferrous metals division meeting. The Singapore government and businesses realize that the "free passage of people, money, and goods is a prerequisite to successful business dealings," he said. "This is a free port with no export duties and with import or excise duties on only a handful of things. Above all," he added, "there is a level of political stability not attained in any other democracy in the world. This means businessmen in Singapore have been able to make business decisions without watching over their shoulders for sudden change. The government's policy is to make it easy for companies to thrive. Its record as an open economy is second to none. Where government is involved in business," Mackie concluded, "it is usually involved to encourage and assist rather than to regulate and restrict."

Dave Singerman, of Bonus Metal Canada Inc., in Montreal, who is president of BIR's nonferrous technical committee, reported on the Basel Convention, which deals with the international movement of hazardous waste and has potential problems for the scrap industry.

John Crabb, LMC Metals Division of Simsmetal USA, New South Wales, Australia, offered an update on nonferrous processing technology in Asia, pointing out that, "in general terms, the level of scrap industry automation in these regions falls well short of that used in Europe and the United States." He noted that in most parts of the region, particularly in the lesser-developed countries, technology is driven by consumers rather than by merchants. "It is rather surprising to find," he said, "that given Japan's vast technology-based, world-class production facilities and massive domestic scrap arisings, the scrap recycling industry, although using most of the conventional processing equipment, is still very labor intensive."

Through the medium term, Crabb sees more dedicated aluminum shredders being installed in Japan, Taiwan, and, possibly, Korea. He also anticipates more battery-breaking plants throughout the region and a general improvement in overall mechanization levels. "There will be opportunities for western equipment suppliers and joint venture opportunities for scrap merchants, particularly Japan," he concluded.

In a discussion on nonferrous specifications, Michael C.E. Lion, president of the nonferrous metals division, commented that some consumer groups in Europe have been trying to impose their specifications on the scrap industry--a trend which he characterized as "very disturbing." Barry Dorman, OmniSource Corp., Fort Wayne, Indiana, added that consumers are using addendums to specifications in order to get the quality they want. "If you want to ship to a particular consumer, you're going to have to meet the consumer's specification," he said, noting that consumers are willing to pay to have the spec met. Quality is a major specification issue in the United States, he explained, and consumers are altering the basic ReMA specs to accomplish their particular melt needs.

In the international arena, Crabb pointed out, there is a need for a base specification, which consumers could modify to establish particular quality needs.

In other nonferrous issue reports, Lion noted that while the economic outlook is confusing, it shows some promising signs of continuing to gain strength, so the general impression must be one for continuing good demand for nonferrous metals. He explained that the dependency of nonferrous metal consumers on scrap will undoubtedly continue and in all probability will significantly increase in the foreseeable future.

Concerning copper, in particular, Lion said the "market remains steady to strong, with the most significant feature being the high backwardation, which reflects a genuine fundamental position of shortage of material. It can be that the LME and COMEX [Commodity Exchange] are certainly reflecting reality.

"In the last few months we have seen losses of production of copper with the closure of the Bougainville Mine, a lengthy strike in Peru, infrastructural problems that have delayed or halted on-time shipments from Africa and that have manifested themselves in enormously tight positions of copper concentrates and blister, and the extremely tight position of copper scrap," he continued. Lion also said that limited tonnages coupled with competitive demand for copper has squeezed margins to some extent.

Reviewing aluminum, Lion said the picture has been bleaker than copper's from a price perspective. "From the consumer side, scrap secondary ingot production has remained steady despite a varied picture of car sales in different parts of the world," he noted. "In the long term, what's of greatest importance to our members is probably the fact that there is a clear trend of significantly greater usage of aluminum in the manufacture of motor cars, which may well compensate for a leveling off or even for a reduction of total units produced."

Aluminum's short-term future will be determined by the effects of currency demand around the world, Lion predicted.

Furthermore, he said, the strong prices paid for primary grades have had a major effect on both demand and price levels for zinc scrap and residues. Demand for lead, particularly battery plates, has remained good in the Far East and Europe, he noted, adding that reports from national associations indicate strong demand for nonferrous scrap, expressing a reasonable confidence for the future business outlook.

Paper Surplus Continues to Affect Many

Sadao Ishiguro, of the Allan Company, Baldwin Park, California, spoke to the Paper Division on "The Recycling Age in the United States and How It Will Affect the Availability of Paper Stock for Export." In 1989, he said, a record 27.6 million tons of scrap paper were collected in the United States, constituting a recovery rate of 32.5 percent. "This recovery rate is the result of a demand-driven marketplace, which could reach a 40-percent recovery rate by 1995." He added that local and federal legislations will enact mandatory recycling, which, he said, will raise the recovery rate to 50 percent by the year 2000. "By the turn of the century," Ishiguro predicted, "when all finished paper goods will be required to have a 50-percent-or-more recycled content, domestic demand will equal or exceed the supply." Last year, he said, much scrap paper was available for export and a record 6.3 million tons were exported from the United States.

Less optimistic was Jean-Pierre Lehoux, of Soulier, Saint-Denis, France, president of BIR's paper division, who said that scrap paper markets have been on the downswing since the end of 1988: "A growing surplus of scrap paper has led to the lowest prices in many years." If such a collection level is to continue, he said, scrap paper generators such as commercial firms and municipalities must share in collection and marketing costs. The fact that this policy does not involve all countries has generated huge difficulties on the market, according to Lehoux. It makes little sense to further mandate the collection of scrap paper by legal means without simultaneously providing an adequate end use, he concluded.

Ashley Hoare, Birmingham Waste Co., Ltd., Birmingham, England, who is a newly elected vice president of the division, reported that in the United Kingdom newsprint manufacturers persuaded the government and environmentalists to get involved in promoting the reclamation of news and packing grades. "The effort resulted in large volumes of news and packaging being generated," he explained, "but the new production capacity still has not come on stream and the result has been a large surplus at very low prices. This oversupply has taken and will take time to work through the system. Merchants have had to refuse materials and the public is now disenchanted and disbelieving," he continued. "In many cases they do not blame the government or mills when they cannot dispose of their news and packaging--because they are too remote. They blame the merchant contractor that cannot take their paper. Since the matter is no longer 'good press,' the vocal environmental lobby has moved onto new ground." This should be a lesson for everyone involved in reclamation, he said, stressing "only reclaim when a market exists."

The division also elected William Nielsen, Nielsen & Nielsen Inc., Pomona, California, a vice president.

A Japanese Perspective

Hidenobu Ogasawara, Clean Japan Center, Tokyo, reviewed the "Japanese Approach Toward Waste Minimization and Its Future Perspectives" at the municipal wastes committee meeting. In recent years, he said, Japan has recycled more than 36 percent of its total waste stream, even though traditionally, Japan has relied heavily on incineration. In 1987, he noted, more than 70 percent of his nation's municipal solid waste was incinerated. He also pointed out that 90 percent of the local communities in Japan have some form of source separation program, similar to curbside collection programs in the United States.

General Assembly Conclusions

At the general assembly, Heinz de Fries, Erich Bohm GmbH, Hochheim, West Germany, reported that the executive council decided not to vote on a new subscription fee grid for national member associations because of the unexpected changes in Eastern Europe. It was announced that the proposal would be voted on at the fall convention.

Stanley Hill, Coopers (Metals) Ltd., Wiltshire, England, was elected to a two-year term as a vice president of the BIR Executive Council. Costante Guerrini, of Costante Guerrini, Brescia, Italy, and Hans-Erik Hempel-Hansen, H.J. Hansen Genvindings Industri A/S, Odense, Denmark, were reelected for two-year ten-ns as vice presidents.

Demetrio Garcia, Francisco Alberich S.A., San Andres de la Barca, Spain, chairman of the membership committee, reported that 69 applications had been received for membership since May 1989. (This number does not include the 15 applicants that applied for membership while in Singapore.)

Concern About Environment and Scrap/Waste Distinction

BIR president Jake J. Farber, Alpert & Alpert Iron & Metal Inc., Los Angeles, kicked off the convention by telling the general assembly that while the industry "is becoming widely recognized as one of the major solutions to the problem of environmental protection, it is paradoxically facing a major issue--the effects of ill-conceived environmental legislation on the collection, processing, and consumption of secondary raw materials. "Unfortunately," he added, "our commodities have been wrongly considered by misinformed legislators as waste. We should fight to change such legislation."

Farber promised that BIR’s main near-term objective will be to prove that scrap is not waste. "This premise must be the pillar of our industry and a theme which we must carry through the 1990s," he said. "It is vital to the future viability of our industry [that we] show legislators that the application of the same restrictive regulations on scrap recyclers as solid waste handlers will have a counterproductive effect on the environment. We have to show that our industry deals in valuable commodities which should be traded freely."

The BIR commodity divisional presidents took a major step in that direction at the fall 1989 meeting held in Munich when they decided to establish definitions to differentiate between scrap and waste. Austin Merrills, of Ireland Alloys Ltd., in Hamilton, Scotland, public relations committee chairman, developed two definitions, which were approved by the general assembly in Singapore. The new definitions are:

Secondary raw materials are redundant goods, by-products, or residues that are recycled for further use.

Waste includes redundant goods, byproducts, or residues that must be disposed of at a cost.

Farber stressed that another key to the industry's future is Design for Recycling. "We in the United States have been talking about this issue for more than a decade. The Institute of Scrap Recycling Industries (ISRI) has adopted this slogan and it plays a major part in ReMA's public relations messages. We must get this message across to manufacturers of new products and to politicians and legislators in all countries."

Environment and the Three Fs

At the environment committee meeting, chairman Michael C.E. Lion of Philipp and Lion Limited, London, outlined what he defined as the three "Fs" facing scrap processors and recyclers: fear, frustration, and funding. The fear is of the future for industry members due to the complexity and contradictions in legislation. "Our members genuinely fear for their future viability as industrial units," he said. "The costs and effects of implementing and abiding by many rules could drive them out of business," he added.

Frustration centers on the contradictions and continuing changes encountered by the industry in trying to plan and coordinate future requirements to meet the demands of legislation. "The degree of arrogance of those who legislate over us, and yet who are meant to be of service to society, is extraordinary," he charged, adding "It is nonsensical for them to continue to refuse to consult us."

Elaborating on funding, Lion said "the chance and opportunity for BIR to act as a pressure group on behalf of the recycling industry and to be taken seriously is only possible when the commitment of financial resources is available. ...We talk of these things, but we must go from lip service to reality."

Lion welcomed the appointment of Christine Massin as BIR's public relations officer and said it was a positive start toward dealing with the three Fs. "We can begin to develop a profile and lobbying strategy with regard to these matters to ensure that our side of the argument is seen, heard, and taken seriously," he added.

During committee discussion, Robert Lewon, LMC Metals, Richmond, California, urged that BIR fund a major public relations effort to promote the industry and to differentiate between scrap and waste. Although numerous delegates expressed the need for the international association to take offensive action in the legislative and environmental arenas, Lion's request for a show of hands in support of increased funding for such a program revealed little support.

Ferrous Full of Question Marks

Anthony P. Bird, Bird Group, Stratford-Upon-Avon, England, and president of BIR's ferrous division, reported that "in the beginning months of this year we have experienced a difficult market situation that varied in its intensity from region to region," adding that "many areas report there is a scarcity of good-quality material coming into their plants." Bird also noted that "profit margins have been squeezed compared with last year and most companies have been affected by increasing costs on the environmental front. Yet," he added, "without a doubt, there are ready markets on a worldwide basis for all of our products."

The steel industry saw continued growth worldwide last year, Bird said, particularly in Asia, where "the Japanese, Koreans, Taiwanese, and even the Chinese increased their production. I see no reason why there should not be good demand for most of the material that we produce," he added, "although it is going to be a year for belt tightening and for increasing the efficiency of our operations."

Noting the political changes in Eastern Europe, Bird reported that the "impact of the dramatic happenings in the Eastern Bloc is not yet clear. There are massive quantities of unprocessed scrap in these countries that will no doubt filter into world markets over the next several years." He concluded by saying he did not see a large influx of Eastern Bloc material onto the market this year, but that 1991 could be a different situation.

Reporting on the United States, Seymour Padnos, Louis Padnos Iron & Metal Co., Holland, Michigan, noted that the United States has "a very firm market for the near term." He also commented on the environmental exposure involved in handling postconsumer recyclables and said, "the future appears to hold a great deal more governmental regulation of our industry, and our survival may well depend upon the mood of Congress and the Environmental Protection Agency."

On a more optimistic note, Gunther Giffels, Thyssen Sonnenberg GmbH, Duisburg, West Germany, predicted that the steel industry in the European Community (EC) will see an increase in production to 143 million tons by 1995. "This shows a positive trend for the European scrap industry," he said, "but still makes it absolutely necessary to continue the Third Country export policy--to have total freedom of export by 1993."

Giffels added that one of the biggest problems left to be solved for the European scrap industry "is the aim of the EC to impute scrap under the legislation of waste." One important way to voice the distinction between secondary raw materials and waste, he suggested, is "to make allies with national governments and partners in the steel industry."

In a report on the ferrous situation in India, Ikbal Nathani, Nathani Steel Limited, Bombay, explained that although the Soviet Union was to ship to India 800,000 metric tons (mt) of heavy melting scrap in 1989, deliveries totaled only 230,000 mt. This year, a trade agreement between the two nations calls for an 800,000-mt shipment, he said, "but until now the supplies have been nil due to increased consumption in the Soviet Union."

Nathani also said that the Indian government would like local mini-mills to reduce their dependence on imports of raw material and to gradually step up their consumption of domestic direct reduced iron. Another change Nathani reported is in the Indian scrap buying practice. Prior to this year, he said, all scrap was purchased through the Government Canalising Corporation. In 1990, he predicted, 50 percent of Indian mini-mills' scrap requirements will be purchased directly against the mills' own direct or purchased licenses.

Shafi Aboobarker, Trade Ventures, Dubai, United Arab Emirates, provided a perspective on Turkey, where, he said, "steel mills are running flat out to full capacity" and steel scrap demand remains strong. Imports were 4.7 million metric tons in 1989, he said, predicting that 1990 figures would be even higher. Turkey still needs seven to eight cargoes in the short term, he explained, adding that some mills were still holding back on June purchases.

Santokh S. Labana, of the polymer science department at Ford Motor Company, Dearborn, Michigan, in a presentation to the ferrous division on "Recycling and Disposal of Waste Plastics from Automobiles," estimated that the "amount of magnetic fraction per vehicle received at the shredder will drop from 1,280 kg in 1980 to 1,050 kg in 1990 and will fall to 850 kg by 1995," adding that the plastics and rubber in shredder residue was about 100 kg per car in 1980 and increased to 135 kg in 1990. This, he noted, is because the amount of plastics used to manufacture North American vehicles increased from an average of 51 kg per vehicle in 1970 to an average of just over 120 kg in 1989. When asked about Ford's plans to Design for Recycling, he said a meeting was set to discuss this concept when he returned from Singapore. He also suggested the need for more dialogue between shredder operators and auto manufacturers.

Nickel/Stainless Situations Examined

Barry Hunter, Samuel G. Keywell Co., Port Elizabeth, New Jersey, who is chairman of the stainless steel and special alloys committee, started off his session by noting that U.S. stainless steel and related alloy producer business remains decent. "Margins, primarily due to the tremendously competitive nature of our businesses, continue to erode as we struggle to secure material," he added. "It would appear that the tremendous years of 1988 and 1989 literally cleaned up a great deal of obsolete scrap that was laying in our suppliers' yards. Prompt industrial scrap intake to date has not yet begun to reflect the continued demand for stainless steel finished product. In addition," he said, "we have seen, and apparently will continue to see, territorial expansions by major scrap processors, which also tend to cause price escalations since these new locations must express their position in the buying market."

Looking at the second quarter of 1990, Hunter said ingot production in the United States remained good, with scrap requirements keeping "abreast, thereby potentially reducing exports." Scrap recyclers have been pressured to produce tonnages that continue to shrink margins, he noted, adding that pricing to consuming markets reflects the London Metal Exchange (LME), in spite of an apparent shortfall of scrap supplies. "In other words," Hunter explained, "if the LME goes down, we will take less from consumers--if we desire sales--and have a difficult time in adjusting our buying accordingly."

Reporting on the current U.S. scrap market situation for nickel, ni-chrome, airmelt grades, super alloys, vacuum grade, corrosion-resistant alloys, cobalt bearing, titanium, and tool steels, Sidney Greenberger, National Nickel Alloy Corp., Pittsburgh, summarized, "it's very good to own good-quality alloy scrap." With it, in today's market, "you cannot go far wrong," he said.

The third and fourth quarters of 1990 will be "good, but not great," for these scrap materials, Greenberger forecast, "if the consumers have correctly assessed their ongoing business." In addition, he said, "there is a school of thought that the changes in Eastern Europe, Germany, and the Soviet Union will create an unprecedented boom in exports." However, he noted, although "this may indeed happen, it is doubtful for 1990--it may take several years." What is almost certain, Greenberger predicted, "is that the Soviets will be granted most-favored-nation status very soon." This will bring U.S. nickel prices more in line with European prices, he said, noting that "we can also expect to have an LME warehouse established in the United States, which would help to further stabilize nickel." Greenberger concluded his report by stating that "some very knowledgeable experts say that demand may make 1990 the third best year ever for our industry."

Graham Price, Cronite Alloys Limited, Sheffield, England, reporting on nickel/stainless in the United Kingdom, said a near withdrawal from scrap buying by British Steel Stainless contributed to losses in volumes, in prices, and in margins for stainless traders during the six-month period prior to the BIR conference. He said many have forecast for improving demand for nickel and nickel-alloy scrap in Britain as consumers' order books run up to the full level. The last time this happened, Price noted, prices for scrap rose freely. "I expect more control from the consumers this time around."

As a committee meeting guest speaker, J.C.M. Shih of Inco Pacific Ltd., Taiwan Branch, and Taiwan Nickel Refining Corp., Taiwan, provided an overview of the stainless steel industry in Asia. "The Asian stainless steel industry today is playing a significant role in the world stainless steel industry," he said. "We have seen a solid growth of the industry and we are very optimistic about its fast growth and future." He pointed out that the per capita consumption of stainless steel in 1989 was 16.00 kilograms (kg) in Japan, 21.41 kg in Singapore, 15.61 kg in Taiwan, and 8.7 kg in Korea, compared with 6.47 kg in the United States. Stainless steel melting capacity in Japan will increase 10.5 percent, he forecast, to more than 4.5 million tons, between 1989 and 1992. Cold rolling capacity is expected to increase 23.7 percent, to 1.2 million tons, in the same time frame.

Nonferrous Metals Division Discusses Specs, Market Conditions

Roy Mackie, former editor of the Singapore Business Times, spoke on "Trade and Business Contacts in and With Singapore" at the nonferrous metals division meeting. The Singapore government and businesses realize that the "free passage of people, money, and goods is a prerequisite to successful business dealings," he said. "This is a free port with no export duties and with import or excise duties on only a handful of things. Above all," he added, "there is a level of political stability not attained in any other democracy in the world. This means businessmen in Singapore have been able to make business decisions without watching over their shoulders for sudden change. The government's policy is to make it easy for companies to thrive. Its record as an open economy is second to none. Where government is involved in business," Mackie concluded, "it is usually involved to encourage and assist rather than to regulate and restrict."

Dave Singerman, of Bonus Metal Canada Inc., in Montreal, who is president of BIR's nonferrous technical committee, reported on the Basel Convention, which deals with the international movement of hazardous waste and has potential problems for the scrap industry.

John Crabb, LMC Metals Division of Simsmetal USA, New South Wales, Australia, offered an update on nonferrous processing technology in Asia, pointing out that, "in general terms, the level of scrap industry automation in these regions falls well short of that used in Europe and the United States." He noted that in most parts of the region, particularly in the lesser-developed countries, technology is driven by consumers rather than by merchants. "It is rather surprising to find," he said, "that given Japan's vast technology-based, world-class production facilities and massive domestic scrap arisings, the scrap recycling industry, although using most of the conventional processing equipment, is still very labor intensive."

Through the medium term, Crabb sees more dedicated aluminum shredders being installed in Japan, Taiwan, and, possibly, Korea. He also anticipates more battery-breaking plants throughout the region and a general improvement in overall mechanization levels. "There will be opportunities for western equipment suppliers and joint venture opportunities for scrap merchants, particularly Japan," he concluded.

In a discussion on nonferrous specifications, Michael C.E. Lion, president of the nonferrous metals division, commented that some consumer groups in Europe have been trying to impose their specifications on the scrap industry--a trend which he characterized as "very disturbing." Barry Dorman, OmniSource Corp., Fort Wayne, Indiana, added that consumers are using addendums to specifications in order to get the quality they want. "If you want to ship to a particular consumer, you're going to have to meet the consumer's specification," he said, noting that consumers are willing to pay to have the spec met. Quality is a major specification issue in the United States, he explained, and consumers are altering the basic ReMA specs to accomplish their particular melt needs.

In the international arena, Crabb pointed out, there is a need for a base specification, which consumers could modify to establish particular quality needs.

In other nonferrous issue reports, Lion noted that while the economic outlook is confusing, it shows some promising signs of continuing to gain strength, so the general impression must be one for continuing good demand for nonferrous metals. He explained that the dependency of nonferrous metal consumers on scrap will undoubtedly continue and in all probability will significantly increase in the foreseeable future.

Concerning copper, in particular, Lion said the "market remains steady to strong, with the most significant feature being the high backwardation, which reflects a genuine fundamental position of shortage of material. It can be that the LME and COMEX [Commodity Exchange] are certainly reflecting reality.

"In the last few months we have seen losses of production of copper with the closure of the Bougainville Mine, a lengthy strike in Peru, infrastructural problems that have delayed or halted on-time shipments from Africa and that have manifested themselves in enormously tight positions of copper concentrates and blister, and the extremely tight position of copper scrap," he continued. Lion also said that limited tonnages coupled with competitive demand for copper has squeezed margins to some extent.

Reviewing aluminum, Lion said the picture has been bleaker than copper's from a price perspective. "From the consumer side, scrap secondary ingot production has remained steady despite a varied picture of car sales in different parts of the world," he noted. "In the long term, what's of greatest importance to our members is probably the fact that there is a clear trend of significantly greater usage of aluminum in the manufacture of motor cars, which may well compensate for a leveling off or even for a reduction of total units produced."

Aluminum's short-term future will be determined by the effects of currency demand around the world, Lion predicted.

Furthermore, he said, the strong prices paid for primary grades have had a major effect on both demand and price levels for zinc scrap and residues. Demand for lead, particularly battery plates, has remained good in the Far East and Europe, he noted, adding that reports from national associations indicate strong demand for nonferrous scrap, expressing a reasonable confidence for the future business outlook.

Paper Surplus Continues to Affect Many

Sadao Ishiguro, of the Allan Company, Baldwin Park, California, spoke to the Paper Division on "The Recycling Age in the United States and How It Will Affect the Availability of Paper Stock for Export." In 1989, he said, a record 27.6 million tons of scrap paper were collected in the United States, constituting a recovery rate of 32.5 percent. "This recovery rate is the result of a demand-driven marketplace, which could reach a 40-percent recovery rate by 1995." He added that local and federal legislations will enact mandatory recycling, which, he said, will raise the recovery rate to 50 percent by the year 2000. "By the turn of the century," Ishiguro predicted, "when all finished paper goods will be required to have a 50-percent-or-more recycled content, domestic demand will equal or exceed the supply." Last year, he said, much scrap paper was available for export and a record 6.3 million tons were exported from the United States.

Less optimistic was Jean-Pierre Lehoux, of Soulier, Saint-Denis, France, president of BIR's paper division, who said that scrap paper markets have been on the downswing since the end of 1988: "A growing surplus of scrap paper has led to the lowest prices in many years." If such a collection level is to continue, he said, scrap paper generators such as commercial firms and municipalities must share in collection and marketing costs. The fact that this policy does not involve all countries has generated huge difficulties on the market, according to Lehoux. It makes little sense to further mandate the collection of scrap paper by legal means without simultaneously providing an adequate end use, he concluded.

Ashley Hoare, Birmingham Waste Co., Ltd., Birmingham, England, who is a newly elected vice president of the division, reported that in the United Kingdom newsprint manufacturers persuaded the government and environmentalists to get involved in promoting the reclamation of news and packing grades. "The effort resulted in large volumes of news and packaging being generated," he explained, "but the new production capacity still has not come on stream and the result has been a large surplus at very low prices. This oversupply has taken and will take time to work through the system. Merchants have had to refuse materials and the public is now disenchanted and disbelieving," he continued. "In many cases they do not blame the government or mills when they cannot dispose of their news and packaging--because they are too remote. They blame the merchant contractor that cannot take their paper. Since the matter is no longer 'good press,' the vocal environmental lobby has moved onto new ground." This should be a lesson for everyone involved in reclamation, he said, stressing "only reclaim when a market exists."

The division also elected William Nielsen, Nielsen & Nielsen Inc., Pomona, California, a vice president.

A Japanese Perspective

Hidenobu Ogasawara, Clean Japan Center, Tokyo, reviewed the "Japanese Approach Toward Waste Minimization and Its Future Perspectives" at the municipal wastes committee meeting. In recent years, he said, Japan has recycled more than 36 percent of its total waste stream, even though traditionally, Japan has relied heavily on incineration. In 1987, he noted, more than 70 percent of his nation's municipal solid waste was incinerated. He also pointed out that 90 percent of the local communities in Japan have some form of source separation program, similar to curbside collection programs in the United States.

General Assembly Conclusions

At the general assembly, Heinz de Fries, Erich Bohm GmbH, Hochheim, West Germany, reported that the executive council decided not to vote on a new subscription fee grid for national member associations because of the unexpected changes in Eastern Europe. It was announced that the proposal would be voted on at the fall convention.

Stanley Hill, Coopers (Metals) Ltd., Wiltshire, England, was elected to a two-year term as a vice president of the BIR Executive Council. Costante Guerrini, of Costante Guerrini, Brescia, Italy, and Hans-Erik Hempel-Hansen, H.J. Hansen Genvindings Industri A/S, Odense, Denmark, were reelected for two-year ten-ns as vice presidents.

Demetrio Garcia, Francisco Alberich S.A., San Andres de la Barca, Spain, chairman of the membership committee, reported that 69 applications had been received for membership since May 1989. (This number does not include the 15 applicants that applied for membership while in Singapore.)