PA/SW-29
V
r
THE
SALVAGE
INDUSTRY
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THE SALVAGE INDUSTRY
what it is—how it works
Salvaging materials in solid wastes is
an essential part of improved solid
waste management: It reduces the
quantity of wastes requiring collection
and disposal. At the same time, it
helps conserve valuable natural re-
sources.
But salvaging has not traditionally
been viewed as a solution to waste
management problems. The activity has
been a necessity, pursued for its own
sake. Man has alway scrutinized wastes
and has extracted whatever valuable
materials he could. The reason was
simple: It required less human energy
to recover waste materials than to ob-
tain and process virgin raw materials.
In the latter half of the 20th century,
in a few highly developed countries of
the world, modern technology and the
use of fossil fuels have created a
situation where this frequently is no
longer true. Consequently many mate-
rials that in earlier times would have
been recovered are now discarded.
This decline in salvaging of wastes
comes at a time when the American
people are showing great interest in
resource recovery. Schools and other
civic groups organize drives to collect
bottles, cans, and paper, and neighbor-
hood recycling centers are being estab-
lished. These moves may increase the
supply of salvaged materials, but they
do not necessarily increase demand—
as many dedicated volunteers have
found out when no scrap dealer wanted
his bottles, cans, and paper.
Recognizing that availability of
markets is crucial to greater use of
waste-derived materials, the U.S. En-
vironmental Protection Agency con-
tracted for a study to evaluate potential
markets. The study, by Arsen Darnay
and William E. Franklin, Midwest
Research Institute, Inc., Kansas City,
Missouri, focussed on the economics
of recovering the commodities en-
countered in municipal wastes and
on how the salvage industry handles
these commodities.
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SALVAGE
INDUSTRY
Salvaging of wastes has never been a
major activity of mankind (like trans-
portation, agriculture, or construction),
but it could always be found on the
margins of major activities. For this
reason, it is a somewhat mysterious
activity, poorly lighted by statistical
facts and reporting systems. It is a
world of small entrepreneurial ven-
tures—sometimes the part-time busi-
ness of one man—with prices that shift
like quicksand, poor records, and a
demand-supply picture dependent on
innumerable unique local conditions.
Salvage is also an activity in transition,
characterized by the disappearance of
traditional structures and emergence of
new ones.
In 1967, the United States salvage or
secondary materials,industry consisted
of 8,000 companies employing 79,000
people and ringing up sales of $4.6
billion. The industry handled 80 mil-
lions tons of metals, paper, glass, tex-
tiles, and rubber. This is the "formal"
portion of the salvage industry—the
dealers, processors, and brokers who
accept secondary materials from many
sources, sometimes process them, and
finally sell them to industrial users.
Not all the waste materials recov-
ered or sold pass through the hands
of the traditional salvage industry. Most
of the glass and much of the metal re-
cycled in the United States are derived
directly from the basic manufacturing
processes and are recycled without
leaving their point of origin. The render-
ing industry, which accepts organic
wastes for reprocessing, is not generally
considered a part of the industry.
Numerous waste products such as
metallurgical slag, fly ash, and rubber
tires do not involve junk dealers or
brokers.
how
the industry
is structured
The salvage industry has several iden-
tifiable layers. At the bottom is the
scavenger or junkman—an individual
who supports himself in part or entirely
by picking up waste materials from
sources such as small machine shops
or printing shops and selling them to
secondary materials dealers. The two
most important characteristics of the
scavenger or junkman are that he is an
independent operator and that his par-
ticipation in the salvage business usu-
ally is a part-time activity, and only
marginally economical. A special form
of the junkman is the small private
hauler who segregates salable materials
from wastes as they are dumped into
his truck, then sells them to salvage
dealers from time to time.
The next layer is represented by the
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naterials flow through many channels in the salvage industry
SCRAP-CONSUMING INDUSTRIES
DEALER
PROCESSOR
SPECIALIST
DEALER
BROKER
WASTE
HAULER
SOCIAL
SERVICE
AGENCY
SMALL
DEALER
SCAVENGER,
JUNKMAN
CIVIC
GROUP
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small dealer who usually handles
metals, paper, and textiles. He seldom
handles quantities large enough to
make it worth his while to develop far-
flung contacts with industrial buyers
of salvage. He accumulates quantities
of materials and sells the accumulation
directly to a larger dealer. These small
salvage dealers are found in population
centers not large enough to support
specialized materials businesses, and
in industrial centers dominated by large
commodity specialist dealers.
Above the small dealer is the dealer-
processor who usually specializes in
either metals, paper, or textiles. He
processes and upgrades the wastes be-
fore delivering them to the scrap-con-
suming industries. If he can obtain
enough materials from smaller dealers
and if the materials are sufficiently
processed, he does not actually handle
the commodities but merely acts as
broker. The salvage industry also in-
cludes brokers who do nothing but
buy and sell commodities.
On the same plane with the dealer-
processor and broker is the specialist
dealer who handles for example, only
nonferrous metals or synthetic tex-
tiles. His contribution to the salvage
industry is his intimate knowledge of
a specific commodity and its markets.
Glass dealers and some rubber deal-
ers do not conform entirely to this
picture of the salvage industry, prob-
ably because only small quantities of
these commodities occur in the open
market. In essence, these dealers are
specialized waste removal firms that
sell the wastes they pick up. Glass
dealers buy waste glass from bottling
operations or flat glass plants, then
process it and sell it to a glass manu-
facturer who remelts it to use in mak-
ing new glass. Rubber dealers are
usually the only link between auto-
mobile service stations or garages,
where tires accumulate, and the rubber
reclaimers who buy old tires.
Intermediate between the junkman
and the small dealer are three types
of organizations—waste haulers, civic
groups, and social service agencies—
that collect commodities and sell
them to the salvage industry. These
organizations are not normally con-
sidered part of the secondary materials
industry.
Waste haulers usually service retail
stores, warehouses, and industrial orga-
nizations that discard large quantities
of corrugated board. Civic groups, in-
cluding churches and schools, may
conduct drives, perhaps once or twice
a year, to collect waste materials. In
the past, newspapers were the chief
commodity collected, but cans and
glass containers are also now being
collected. The materials are sold to a
dealer, the proceeds helping to sup-
port the sponsoring organization's
activities. Wastes also are being col-
lected at recycling centers set up by
volunteer groups interested in the en-
vironment and in conserving natural
resources.
Probably the most extensive collec-
4
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tion activity taking place outside the
formal salvage industry is conducted
by social service agencies. Organiza-
tions such as the Salvation Army and
Goodwill Industries are responsible for
most of the waste textiles collected in
the United States, plus some waste-
paper and small quantities of metals.
Social service organizations typically
pick up usable commodities from resi-
dences, then sell them in secondhand
stores to help support their charitable
and rehabilitative work. Commodities
also are collected in bins placed in
parking lots of shopping centers.
Some of the goods are beyond repair
and are sold as junk or simply dis-
carded as wastes. Social service agen-
cies sometimes compete with salvage
dealers in that they sort and process
wastes, then sell directly to the end
user. As a rule, such agencies pay
below minimum wages, either because
they are sheltered workshops exempted
from requirements of the minimum
wage law or because the labor per-
formed is quasi-voluntary.
scrap is
sold, it
bought
not
An axiom in the salvage industry is
that "scrap is not sold, it is bought."
The skilled secondary materials dealer
is a skilled buyer. Because he sells a
substitute for raw materials, he cannot
control his selling price. It is deter-
mined by demand, which in turn is in-
fluenced by general economic condi-
tions and the relative availability and
cost of virgin resources.
Demand and price fluctuate—the
dealer sometimes may be forced to
tap every conceivable source to satisfy
demand. At other times, he must "turn
off" his poorer sources. If necessary,
he will buy from his best sources to
protect them during periods when de-
mand is low, in order to retain them
as sources when demand is again high.
The successful dealer keeps his in-
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ventories low, buying at the appropriate
price. He avoids long-range commit-
ments to buy (especially from poor
sources) and to sell (unless the sales
price is negotiated high enough or is
pegged just above a published market
price). The skilled dealer "rides the
market," buying only what he can sell,
selling everything he buys, and keeping
a safe margin between his buying and
selling prices.
what's good
and
what's bad
In selecting sources of waste, the
dealer considers concentration or pur-
ity, grade, and quantity. He shies away
from "dirty" scrap. He chooses high-
grade wastes, which most resemble
virgin materials, over low-grade. He pre-
fers buying in quantities large enough
to resell immediately, rather than buy-
ing smaller quantities that must be
accumulated before they can be
shipped. These factors can appear in
many combinations. Mixed municipal
wastes are a poor source, virtually de-
void of concentrations of high-grade
commodities. Commercial establish-
ments such as offices, hotels, and re-
tail stores generate wastes similar to
mixed municipal wastes, except that
commercial wastes contain more paper
and less food wastes. Corrugated board
and mixed office paper are the only ma-
terials salvaged in quantity from com-
mercial wastes. Mixed papers are sal-
vaged only when demand for waste-
paper is high.
Wastes from industry represent the
bulk of secondary materials traded, and
virtually all of the high-grade materials.
The salvage industry favors industrial
wastes because they are homogenous,
of known and consistent composition,
and are generated in large quantities
on a regular basis. All industrial opera-
tions generate waste materials, and
plant managers usually try to reuse or
sell as much as possible—to produce
income, rather than to pay for disposal.
For this reason, manufacturing wastes
are kept free of contaminants, are proc-
essed if necessary, and are accumu-
lated for delivery to salvage dealers.
who buys
its wares
Steel scrap, nonferrous metals, glass,
and small amounts of newspapers and
corrugated boxes are the only second-
ary materials that are reprocessed into
essentially the same products that they
were originally. All others enter new in-
dustries. Most old newspapers and cor-
rugated boxes become bending board
or construction paper. Old tires are
converted to material used to retread
tires. Old cotton cloth becomes wiping
rags. The demand patterns governing
the receiving industries are not neces-
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sarily synchronized with those of the
industries that generated the materials.
Thus, an increase in tire production
may in fact mean a decline in purchase
of retreads.
The products of the salvage industry
are bought by two very different kinds
of scrap-consuming industries. Distinc-
tion between the two is important be-
cause it explains much about the nature
of salvage and recovery in the United
States. The two groups are: industries
that use wastes as principal or sole
input, and industries that use small
amounts of wastes.
Examples of industries that depend
on wastes as their principal or only
input are combination-board manufac-
turers, de-inking mills, roofing paper
mills, wool reweavers, electric steel
furnace operators, secondary metals
smelters, glass producers such as ash
tray manufacturers who use only scrap
glass, rendering plants, and rubber re-
claimers. These industries must ob-
tain secondary materials on the open
market, and they are the backbone of
salvage demand. Their production
rates largely determine how much
waste will be recycled. Some secondary
materials are used because they are
cheaper than virgin materials of equiva-
lent quality. Others are used because
the quality of the manufactured prod-
uct need not be Equivalent to that of
products made of virgin materials (as
in combination board) or because a
product of equivalent quality can be
made from secondary materials (as in
electric-furnace steel).
Examples of industries that use rela-
tivejy small amounts of wastes are
fine-paper manufacturers, operators of
basic oxygen steel furnaces, glass con-
tainer or window glass manufacturers,
plastics producers, and tire manufac-
turers. They use salvaged materials
because technical factors sometimes
favor their use, because not enough
such scrap is generated internally to
fill their needs, and because the sec-
ondary materials they use are relatively
cheaper than virgin raw materials if
processing costs are included. It is diffi-
cult to generalize about the relative
value of virgin and secondary materials
when both are used in one operation.
Scrap materials are not simple substi-
tutes: They may be required by the
process, they may yield special bene-
fits such as prolonged life for furnace
linings, they may have to be used be-
cause they are a process waste material
that would otherwise require disposal,
or they may reduce air or water pollu-
tion.
how
the industry
operates
In recovering waste commodities, the
salvage industry uses up to five types
of operations: acquisition, concentra-
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salvage industry performs up to five operations in
recovering waste commodities
ACQUIRE
CONCENTRATE
PURIFY OR SEPARATE
REDUCE SIZE OR SHAPE
PREPARE FOR SHIPMENT
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tion, purification or separation, reduc-
tion of shape or size, and preparation
for shipment. The sequence in which
they are accomplished—or whether
they are needed at all—depends on the
material itself, as well as on its source,
condition, and end use.
The key operation in salvage is sort-
ing. Except for separating out ferrous
metals magnetically, sorting is done
manually and so is very expensive.
Even magnetic sorting is not possible
where the ferrous metal and some
other material are mechanically or
chemically coupled.
Technology is being developed to
overcome the problems of sorting
mixed municipal wastes. The Environ-
mental Protection Agency has provided
funds to help demonstrate several dif-
ferent systems in full-scale plants. One
system adapts paper pulping technol-
ogy to produce a saleable paper pulp
product, metals, and glass. Another sys-
tem separates metals and glass from
incinerator residue, using various mater-
ials-handling techniques developed in
the mining industry. Four systems ap-
proach the problem of sorting from a
different angle, burning the combust-
ible materials of municipal wastes, and
using the heat produced Still other
systems are being studied but have
not progressed far enough to be demon-
strated in full-scale plants.
operating
costs are
high
The costs of obtaining and processing
secondary materials are high, especially
when related to the price they bring
in the marketplace. Operating econom-
ics are most unfavorable for those
materials that occur in large quantities
in waste—mixed paper, metals, and
glass. Not only is demand limited, but
these materials also bring the lowest
prices, and processing costs are higher
than for better grades of scrap mater-
ials. If the material must be sorted
from mixed municipal wastes, costs
become even higher.
Glass is a good example. In mid-
1970 the sand, soda ash, and limestone
used to make glass cost $15 to $20 per
ton. The glass industry estimates that
the benefits of using scrap glass in the
furnace, instead of virgin raw materials,
are worth $2 per ton. Therefore, to be
economical, scrap glass should cost
no more than $17 to $22 per ton. Instead,
the delivered cost was $29 to $36 per
ton for scrap glass recovered from
mixed municipal wastes:
$13 to $15 for manual sorting
$14 to $18 for pickup and processing
$ 2 to $ 3 for delivery
$29 to $36
It is hardly surprising that glass re-
covery programs involving pickup from
residential sources must be subsidized.
The same generally holds true for all
materials categories, if the materials
must be removed from mixed wastes by
present techniques.
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PHOENIX QUARTERLY
Long before the present national interest
in ecology and recycling, the scrap-
processing industry was at work pre-
paring metallic cast-offs for remelting by
steel mills and foundries.
Transportation is another important
cost consideration in the economics of
salvage. The ultimate value of the ma-
terial determines the relative distance
it can be transported. Most salvaged
secondary materials are consumed no
more than 500 miles from where they
originated. Materials with high value—
nonferrous metals and wiping rags, for
instance—can travel 1,000 miles or
more, but nearly all low-value materials
—newspapers and scrap glass, for in-
stance—are sold within 75 miles.
some
hidden
costs
The economics of salvage can be hard
to understand unless some hidden
aspects are kept in view. The most
significant aspect is that if waste ma-
terials can be salvaged, they don't have
to be disposed. A salvage operation
costing $15 per ton and returning $10
is not, on the face of it, economical.
Yet it may be practical if disposal costs
$6 per ton.
The second aspect of salvage eco-
nomics is that salvaged materials often
ride "piggyback" on a system devel-
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salvage industry is centralizing
the number of companies is decreasing . . . but sales and employment are increasing
1958
1963
1967
1970
1958 1967
1958 1967
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oped for other purposes. An example is
the collection of waste textiles from
residential sources. By collecting door-
to-door, social service agencies get
commodities such as usable furniture
from which they may be able to realize
profits equivalent to several hundred
dollars per ton. The high income justi-
fies collection costs of $80 to $90 per
ton. Waste textiles also are picked up,
but they seldom earn the agency more
than $50 to $60 per ton. Thus, collecting
salvageable materials alone would not
be economical, but it is when they
ride free with more valuable mer-
chandise. Another example of the same
principle involves trucks that carry
merchandise from warehouses to groc-
ery stores. Normally, the trucks would
return empty to the warehouse; instead,
they carry corrugated boxes back to
the warehouse, where large enough
amounts accumulate to make their sal-
vage profitable to management.
The third special economic consid-
eration related to salvage is that the
recovery of some classes of material is
indirectly subsidized by:
• Voluntary contribution of labor, time,
and transportation by neighborhood re-
cycling centers or school-sponsored
paper drives.
• Employment of physically or socially
handicapped persons who receive below
average wages from social welfare
agencies.
• Efforts of people on the margins of
economic existence who salvage com-
modities as an alternative to welfare
and who neither pay themselves an
average wage nor count all of their real
costs (the use of a car or truck, for
example).
• Sloppy accounting by some second-
ary materials dealers and processors
who do not account for all the costs
they incur, especially not amortization
of equipment.
If these hidden subsidies were elim-
inated, recovery of most textiles, news-
papers, and portions of all other re-
covered materials would become un-
economical. These points should be
kept in mind whenever a salvage pro-
gram is contemplated that would dupli-
cate an existing system. If the new
system does not enjoy the same sub-
sidies, it might be economically un-
feasible.
trends
and
development
The salvage industry is changing in a
number of ways, perhaps the most im-
portant being that it is centralizing.
The number of companies has de-
creased since the 1950's, while industry
sales and employment have increased.
The trend toward bigger companies is
in part a result of economic and tech-
nological pressures. The coming of
minimum wage legislation has made
labor-intensive operations of acquiring
and sorting wastes more expensive. To
remain competitive, salvage companies
have had to use technology to increase
labor productivity, just as processors of
virgin materials have done.
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In the ferrous scrap business, the
pressures have resulted in the inven-
tion of large metal shredders which
reduce automobile hulks into fist-sized
pieces of metal that can be separated
magnetically into ferrous and nonfer-
rous portions. These shredders are
working a revolution in the scrap busi-
ness. They permit upgrading a plentiful
source of scrap, auto hulks, so that
they sell for $31 to $36 a ton, instead
of $19 to $24 for unshredded hulks. To
use a shredder efficiently, however, a
scrap dealer must have sales of about
$500,000, and preferably well above. To
achieve this volume, scrap dealers have
had to merge or acquire other com-
panies to tap new scrap sources and
outlets.
In the scrap paper business, the
single most important innovation has
been the high-density baler. Such ma-
chines cost around $120,000 and can
handle 30,000 tons of paper per year.
They reduce freight costs as much as
$5 per ton on trips of 500 miles, they
make the paper easier to handle, and
they provide a better product to the
user. As of mid-1970, only a few were in
operation. To use one efficiently, com-
panies must have sales of about
$600,000 annually, and, again, centrali-
zation is occurring to permit taking
advantage of new technology.
In the textile salvage industry, eco-
nomic pressures have taken four basic
forms:
• Overseas sales of waste textiles are
declining.
• Labor costs are rising.
• Percentage of pure cottons in waste
textiles is decreasing.
• Paper and new nonwoven fabrics are
gaining ground in the markets for wip-
ing rags.
Instead of combining with stronger
dealers, textile salvage dealers are go-
ing out of business. The same situation
prevails in other waste materials, and
the numbers of companies dealing in
glass, rubber, feathers, hair, bone, and
other wastes have decreased drasti-
cally.
Another trend working to the dis-
advantage of the salvage industry is
that the ratio of scrap materials
consumed to total new products made
has been declining in nearly all basic
manufacturing industries. As a result,
relatively more scrap is available than
is needed. The industries consuming
scrap materials can be far more selec-
tive in their purchasing. They can and
do insist that secondary materials be
of higher quality.
At the same time, the obsolete
products and the wastes from industrial
operations that make up the salvage
industry's resources are generally be-
coming more contaminated. Base ma-
terials such as steel, paper fiber, wool,
cotton, rubber, and glass are being
combined with materials that are in-
compatible with the operations of the
raw materials processor. To provide the
raw materials processing industry with
pure scrap, the salvage dealer must
choose his sources more carefully, or
he must do more processing, which
favors larger dealers with the capabil-
ity to invest in technology.
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SALVAGE AND SOLID WASTE
MANAGEMENT ORGANIZATIONS
Until quite recently, solid waste man-
agement organizations viewed salvage
as a nuisance that interfered with
their principal purpose: to collect and
dispose of waste materials efficiently
and in a manner that protected the
public health and the environment. In
1968, the organizations handled almost
194 million tons of municipal wastes.
The tonnages were about equally di-
vided between public forces and private
companies. This service cost the Na-
tion $3.5 billion annually, or $1.1 billion
less than the salvage industry's sales.
The job of collecting the Nation's
municipal wastes is big—and it's get-
ting bigger. The population is growing,
and each person is consuming more
goods and so is discarding more wastes
than before. Furthermore, new air pol-
lution regulations ban open burning.
Wastes that once were burned in back-
yards must now be collected and dis-
posed of.
In the past, many solid waste man-
agement organizations attempted to
salvage commodities from municipal
wastes, but today the only large-scale
salvage practiced by public agencies
is recovering steel cans from inciner-
ator residues—and that is done by only
a few communities. In addition, some
dumps permit scavenging.
Public solid waste management orga-
nizations gave up on salvage because
they found they couldn't sell the com-
modities at a profit. It proved simpler
to pick up, transport, and process a
single mass of waste than to split it
into two or more streams, each requiring
specialized treatment techniques, man-
agement and labor skills, collection and
distribution networks, markets, and ul-
timate disposal arrangements. As the
waste management process has been
streamlined, marginal activities that in-
terfere with the rational organization of
the system have been eliminated.
The current attitude toward salvage
is not solely a result of the decline of
markets. A number of other develop-
ments since World War II have pushed
or enticed waste disposal agencies in
the direction of simplified and efficient
practices:
• Introduction of the compactor truck,
which permits carrying larger loads,
but prohibits salvage because wastes
are mixed together and contaminated.
• Public resistance to segregating
wastes prior to collection.
• Increase in kitchen garbage grinders,
which divert organic solid wastes into
sewers, and concomitant decrease in
using wastes for animal feed. When
14
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public health considerations dictated
that garbage had to be cooked before
it could be fed to animals, a new
cost was introduced that closed down
virtually all feeding lots based on gar-
bage.
• Growing use of sanitary landfilling.
Scavengers who were welcome at open
dumps are unwelcome at sanitary
landfills, where their presence inter-
feres with efficient and safe opera-
tions.
Today, salvage must show an over-
whelming advantage before it is con-
sidered by the more efficient and well
organized solid waste management
agencies. Financial incentive is not
enough. Income from a smalt percent-
age of the waste is readily sacrificed
if it impedes disposal of the bulk of
the waste.
Municipal waste management prac-
tice, characterized as it is by bureau-
cratic regularity, presents a poor fit
to the usually roller-coaster operation
of the salvage business, where supplies
a quarter of major manufactured
materials are salvaged
1967-68
Material
PAPER
IRON AND STEEL
ALUMINUM
COPPER
LEAD
ZINC
GLASS
TEXTILES
RUBBER
Total
consumption
(million tons)
53.110
105.900
4.009
2.913
1.261
1.592
12.820
5.672
3.943
Total
recycled
(million tons)
10.124
33.100
.733
1.447
.625
.201
.600
.246
1.032
Recycling as
percent of
consumption
19.0
31.2
18.3
49.7
49.6
12.6
4.2
4.3
26.2
TOTAL
191.220
48.108
25.2
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over half of municipal wastes
consist of salvageable commodities
EXTILES, RUBBER,PLASTICS,
03
in
O
w
PAPER, 40
ASS,
METALS, 8<4
GO
w
O
FOOD AND
MISCELLANEOUS f {
WASTES, 33-430/0 i I
1968
must be "turned off" one day and
"turned on" a month later. City offi-
cials have learned by experience that
salvage dealers are not "reliable"
buyers of scrap.
In the wake of Earth Day 1970, how-
ever, public officials are beginning to
change their attitudes toward salvage.
The growing Federal interest in re-
source recovery, as well as industry's
efforts to find ways of reclaiming ma-
terials, is making public officials take
a second look at salvage. Another fac-
tor is that public officials are coming
to view salvage as a way of conserving
scarce space in sanitary landfills.
Private waste companies generally
share the attitudes of public sanita-
tion officials, but they are quicker to
react to the economic incentives in
salvage. Private haulers handle more
commercial wastes than do public
agencies, including sources rich in
corrugated paper; their salvage activi-
ties, if any, usually involve corru-
gated.
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SALVAGEABLE COMMODITIES
IN MUNICIPAL WASTES
In the 1967-68 period, 191 million tons
of the major manufactured materials
—paper, metals, glass, textiles, and
rubber—were consumed yearly. In the
same period. 48 million tons of these
same materials—about 25 percent—
were recycled through the market an-
nually.
Recycled materials generally come
from either fabrication wastes or ob-
solete discarded products returned to
industry for reprocessing. Almost no
materials are salvaged from municipal
wastes, although over half (by weight)
of such wastes are salvageable.
paper
In 1969, the United States consumed
58.5 million tons of paper—more than
12,000 kinds in over 100,000 finished
forms. Paper consumption has almost
tripled since 1945 and is expected to
continue to increase. By 1980, the
United States should be consuming
85 million tons annually.
Unlike steel products, which have
an average life of 20 years, most paper
is used and discarded in the same year
it is purchased. Its value is low in
comparison to its bulk, so most dis-
carded paper products enter the waste
stream. Paper is the largest component
—40 to 50 percent by weight—of muni-
cipal wastes collected in the United
States. Once in the waste stream, al-
most none is salvaged. However, paper
is salvaged before it gets into the
stream—principally discarded paper
products and scrap produced when
paper is converted into finished forms
such as envelopes or boxes.
While consumption of paper has in-
creased in recent years, the percentage
recycled has decreased. In 1969, only
about 17.8 percent of the paper con-
sumed in the United States was re-
cycled paper, versus 27.4 percent in
1950. The result is that paper is an
ever-increasing burden on solid waste
systems.
Making paper starts with harvesting
wood from trees and converting it to
pulp in pulp mills. The pulp is then
converted in paper mills to the basic
kinds and grades of paper. Paper mills
can also use wastepaper; generally, it
is converted into cheaper types of
paper than it was originally. The last
step is to convert paper into finished
forms. These various steps can be
aligned in a number of ways—ranging
from the large integrated operations
that grow trees and sell envelopes to
an independent pulp mill that merely
17
-------
paper is increasing in municipal wastes
1956
1966
1976
1980
60 80
MILLIONS Or TONS CONSUMED
makes pulp for sale.
Today, the U.S. paper industi
dominated by the large integ
operations. Most of the plants inst
since 1945 have been based on
pulp and located near virgin raw
terials, primarily in the South am
West, rather than close to popul
centers where paper is consumed
later discarded. Using improved \
pulping technology, the industry
tapped abundant raw material
costs low enough and in quan
large enough to meet rising derr
for paper. Only very recently ha;
technology for wastepaper begu
catch up.
Most of the paper now recycled
into making paperboard, the
forms of paper used primarily to
boxes. Small amounts are used ii
other major types- of paper prodi
construction materials (such as r<
felts) and paper itself.
The demand for products made
dominantly of waste, or secoi
-------
paper production facilities are located away from
population centers where waste paper is discarded
-------
fibers has lagged in recent years for
three reasons:
• Products made mostly of waste-
paper tend to increase at a lower rate
than other paper products and are
losing markets to competitive mater-
ials such as plastics.
• Wood pulp has taken over some
markets—packaging, for example—from
wastepaper as industry has upgraded
its products to improve appearance and
to achieve higher "purity," even when
performance of the product did not
require upgrading.
• Wastepaper has penetrated only
one new market in recent years—
newsprint.
Wastepaper for recycling comes
from these major sources.- corrugated
boxes collected from stores, news-
papers collected mostly from homes,
and wastes from paper converters.
Newspapers are one of only two ma-
terials commonly found in municipal
waste that are still salvaged in quan-
20
tity. The other is textiles, which are
either resold or diverted into second-
ary uses. These materials are segre-
gated before collection, and in a
sense have never been part of the
solid waste stream. The mixtures of
other paper products found in the
family garbage cans are not good
candidates for recycling as they are.
Even if they could be segregated, they
would be difficult to salvage as com-
modities.
Almost anything added to paper,
either intentionally or unintentionally,
in large quantities or small, destroys
its value as wastepaper because of
the cost involved in removal. The
paper for "slick" magazines, for ex-
ample, is coated with clay. Although
clay is easily removed, it can cause
water pollution, and it also represents
30 percent or more of the weight of
the paper. Plastic coatings and ad-
hesives must be removed before paper
can be recycled. There is no economi-
cal way of recycling laminated paper,
such as is used in some frozen orange
juice cans.
The fundamental problems are those
of accumulating "pure" grades and of
fighting low levels of contamination.
The progressive contamination of
fibrous materials in the converting/
consuming cycle work against recycling
of paper. In contrast, making paper
from virgin pulp is a process that
progressively upgrades fibers.
Still, considerable quantities of
paper can be recovered from products
commonly found in municipal wastes,
From 5 to 10 million more tons of
newspapers and corrugated board
could be recovered by time-honored
techniques. An equal amount of mixed
paper, none of which is now recovered,
might even be recovered—either by
asking the public to voluntarily segre-
gate it or by using new technology to
separate it and then upgrading the
recovered product so it will be com-
petitive with existing raw materials.
It is technically feasible for the
paper industry to absorb additional
quantities of wastepaper. But to do
-------
paper for recycling conies from ...
COMMERCIAL
SOURCES, 43.67o
RESIDENTIAL
CONVERTERS, 39.8<7b [SOURCES, 16.6^0
recycled paper is used in . .
-------
so, it will have to idle large portions
of its equipment for pulping wood.
This would require a large drop in the
price of wastepaper, a high tax on
use of virgin pulp, or equivalent
changes that would make wastepaper
fiber as cheap as pulp.
By the 1980's, however, new low-cost,
readily-available pulpwood lands may
all have disappeared. Then virgin
prices will rise, and industry may turn
to wastepaper out of necessity. But
for now, the industry is oriented to
pulp. Its plants are principally located
close to forest sources, and the eco-
nomics of using more wastepaper are
unattractive.
ferrous
metals
The iron and steel industry in the
United States uses large quantities of
scrap metal in its operations. In 1967,
it purchased 33 million tons, which
represented almost a third of the
metals it used during the year. In ad-
dition, 7.6 million tons of scrap were
exported.
Of the 33 million tons of scrap the
industry purchased, 11.6 million were
supplied by fabricators of steel prod-
ucts. The remaining 21.4 million tons
were obsolete scrap. Almost no ferrous
metals were recovered out of munici-
pal solid wastes, although they consti-
tute about 7 percent by weight of the
municipal wastes collected in the U.S.
In addition to the scrap it purchased,
the industry used 52 million tons of
scrap generated internally. Use of this
"home" scrap has increased in the
past few decades, at the expense of
obsolete scrap.
The relative amounts of scrap and
pig iron the industry uses to make steel
have shifted in recent years because of
shifts in the kinds of furnaces being
used:
• Open hearth furnaces, which proc-
ess 41.7 percent of scrap in their metal-
lic inputs, produced 50 percent of total
steel output in 1968, down from 87
percent in 1960.
• Basic oxygen furnaces, which proc-
ess 29.2 percent scrap, produced 37.1
percent of total output in 1968, up
from 3.3 percent in 1960.
• Electric furnaces, which process
97.9 percent scrap, produced 12.7 per-
cent of total output in 1968, up from
8.4 percent in 1960.
The rapid rise in the basic oxygen
furnace has meant a slight decrease
in the industry's use of scrap (down
from 47.8 percent in the 1947-53 period
to 43.4 percent during 1964-68). This
decline will not necessarily continue
indefinitely. What is more likely to
happen is that as demand drops, scrap
prices will drop, basic oxygen fur-
naces will be modified to permit using
more scrap, and more electric furnaces
will be installed.
Scrap is used in steel furnaces as
a relatively inexpensive source of iron.
Except in electric furnaces, where
the input is almost entirely scrap, it
is not a direct substitute for pig iron.
22
-------
scrap satisfies almost a third of the iron and
steel industry's demand for metals
-------
Rather, scrap is used to achieve best
technical operations. But much of the
scrap input is generated internally
and must be used if industry is to
avoid severe losses of its metals.
About a quarter of the obsolete
scrap used by the steel industry
comes from automobile wreckers and
railroads. A host of other sources (in-
cluding demolition projects, farms, and
shipbreaking) account for the remain-
der. Steel makers prefer home scrap
because they know exactly what it con-
tains, although scrap from fabrication
plants is almost as good. Steel from
demolition of buildings, ships, rail-
cars, and other structures is high qual-
ity scrap because its composition can
be readily ascertained. Shredded auto-
mobile steel, if all nonferrous metals
and nonmetallics are removed, also
falls into this category. Least desir-
able is mixed scrap of unknown origin,
which includes burned auto bodies
and metals derived from municipal
wastes.
Ferrous metals occurring in munic-
ipal wastes consist largely of tin-
coated steel cans, which are not suit-
able for recycling in steel furnaces.
The tin coating cannot be removed
and contaminates the furnace prod-
ucts. Tin-free steel is slowly coming
into use, so—technically at least—re-
cycling of steel cans is becoming more
feasible.
The small tonnages of ferrous metals
recovered from municipal wastes are
usually in two forms—massive pieces
removed from incinerator residues or
retrieved from dumps or landfills, and
steel cans recovered from incinera-
tor residues and sold to copper mines
in the west. About 300,000 tons of
scrap cans and wastes from can manu-
facturers are used annually at the
mines to recover copper from low-
grade ores. This market may triple
over the next decade, but it is still
a limited one. Large quantities of
wastes in concentrated form are avail-
able from can manufacturers, and the
cost to transport scrap cans from
population centers to the mines is
high. Therefore, reusing a large per-
centage of obsolete cans in copper
mining does not appear to be a practi-
cal solution.
In general, ferrous metals are re-
cycled at a fairly high rate—but still
far below the potential supplies avail-
able and the amounts the industry
could recycle. More ferrous scrap will
be consumed only when its price be-
comes more competitive with that of
virgin raw materials. As in the case
of paper, this will require interven-
tion in the normal market forces.
24
-------
nonferrous
metals
The major nonferrous metals—alumi-
num, copper, zinc, and lead—consti-
tute less than 1 percent of collected
municipal wastes. In 1967, nearly 9.8
million tons were consumed, of which
3 million were provided by recycled
materials, for a composite recycling
rate of 30.8 percent.
All these metals are valuable as
scrap. In contrast to steel, which
was selling for $130 per ton in 1967,
their prices ranged from $277 per ton
for zinc to $754 for copper. Their
composite value in 1967 was $517 per
ton. As waste they usually appear in
small quantities and in combination
with other metals. But their high
value permits relatively more proc-
essing than is normal with other
wastes, as well as acquiring smaller
quantities.
Copper, zinc, and lead are in short
supply worldwide. Their high rates
of recovery—particularly copper and
lead—are a reflection of this shortage,
and their recovery rates are expected
to continue to climb.
Copper for recycling comes from
both industrial wastes and from ob-
solete products. Only small amounts
are found in municipal wastes, in the
wiring of household appliances. It is
no longer economical to strip and
collect this copper. Most obsolete cop-
per scrap comes from demolition of
electric utilities, spent cartridges,
railroad car dismantling, and auto-
motive radiators.
Nearly 80 percent of all zinc re-
cycled comes from processing and
fabrication wastes. The relatively small
amounts recycled from obsolete prod-
ucts is explained by the fact that
zinc is used as an alloying agent,
a coating, and as small objects and
fixtures. All make recycling difficult.
Recovery of lead is unusual in that
most scrap comes from one discarded
consumer product, the storage bat-
tery. More than 90 percent of the
lead used in batteries is recovered.
The only nonferrous metal occur-
ring in significant quantities in mu-
nicipal solid wastes is aluminum, prin-
cipally because it has become an im-
portant container and packaging ma-
terial. Of the scrap the industry pur-
chased, about 80 percent came from
fabrication wastes, the remaining from
obsolete sources. About two-thirds of
the scrap is remelted by secondary
smelters, largely for use in castings.
Unlike the situation in the steel
industry, where scrap and pig iron
do not compete on an equal basis,
scrap aluminum in the form of sec-
ondary ingot competes directly with
primary ingot in the nonintegrated seg-
ment of the aluminum industry. Sec-
ondary ingot cannot be used in ap-
plications where a high level of purity
is required. However, it has the ad-
vantage of being cheaper. Economics
favor secondary aluminum because
production of primary aluminum re-
quires large investment in plants. And
freight costs are high for primary
aluminum because the plants are usu-
ally located in remote areas where the
25
-------
purchased scrap glass represents less than
5 percent off production
TOTAL! 12,820
PURCHASED
SCRAP (4.7%)
CONTAINERS
(1-1%}
FLAT CLASS
(11.3%}
PRESSED AND
BLOWN
(14.9%}
10 12
PRODUCTION IN THOUSANDS OF TONS ,1967
-------
necessary large quantities of cheap
power are available. The combina-
tion of expanding markets for alumi-
num castings, favorable economics, and
ever more abundant supplies of scrap
has contributed to a steady expansion
of secondary smelting of aluminum.
A new and growing source of scrap
aluminum is the reclamation centers
set up by aluminum companies. With
the proportion of aluminum in munic-
ipal wastes rising and aluminum cans
such a visible part of litter, the com-
panies reacted to growing legislative
pressures by getting involved in re-
claiming aluminum packaging. The
aluminum industry programs depend
on the public delivering the cans to
a central collection point where they
are processed for shipment to a sec-
ondary smelter. Success turns on three
points:
• Aluminum is valuable—about $200
per ton at the collection center—and
thus is relatively attractive for scrap
processing.
• Large enough quantities are brought
in so that the collection centers op-
erate economically.
• The public collects the cans vol-
untarily.
To date, the programs have suc-
ceeded in recovering 10 to 15 percent
of the aluminum containers available
in an area. Ultimately, they might be
able to recover as much as 30 per-
cent. There are no technical limita-
tions to recycling aluminum; rather,
the problems are in separation and
collection. The current aluminum in-
dustry programs involve presegrega-
tion and special handling. As yet, no
company has attempted to tie alumi-
num packaging and reclamation di-
rectly to a municipal waste system.
glass
Glass has an extremely low recycling
rate if in-plant scrap is excluded. In
1967, total glass production was 12.8
million tons, of which only 0.58 mil-
lion tons, or 4.7 percent of consump-
tion, was purchased scrap.
The principal raw materials of glass
are sand, soda ash, and limestone (or
dolomite). In addition, for technical
and economic reasons, nearly every
type of glass requires scrap glass, or
cullet. It speeds up the melting proc-
ess in glass furnaces and so reduces
fuel costs. The amount of cullet varies,
from 8 percent to 100 percent; the
average for glass containers is 14 to
16 percent. Most segments of the glass
industry could use much more cullet
than they do.
The glass industry strongly favors
internally generated cullet. Not only
is there no question about its com-
position and quality, but it is cheaper
because the basic raw materials are
plentiful and cheap. If internal scrap
supplies are inadequate, a manufac-
turer often devotes excess capacity
to deliberately producing cullet. Pur-
chased cullet is an unknown quan-
27
-------
man-made fibers have grown
at expense of wool and cotton
TOTAL
5,672
1960
1964
MAN-MADE
2,598
COTTON
1,994
OTHER
841
i WOOL 239
1968
-------
tity, and its use risks contaminating
and hence losing a batch of glass.
Most of what little cullet is purchased
originates in beer and soft drink bot-
tling operations. Small quantities are
purchased from neighborhood recycling
centers. In recent years, rising costs
and declining sources of good cullet
have pushed many cullet dealers out
of business.
Containers account for about 70 per-
cent of total glass production, with
pressed, blown, and flat glass account-
ing for the remainder. Essentially the
entire output of glass containers is
discarded to municipal wastes sys-
tems. Glass represents 6 to 8 per-
cent by weight of the materials found
in municipal solid wastes—and 90 per-
cent of that is glass containers.
In the last decade, the number
of glass containers consumed has in-
creased 5.2 percent a year. Beverage
containers have become the dominant
type of container, reaching 51 percent
on a unit basis of total industry out-
put in 1969, compared to 26 percent
in 1959 when the switch to nonre-
turnable beer and soft drink containers
got under way. The other important
end use, food packaging containers, is
growing modestly, while drug, cos-
metic, and chemical container mar-
kets have stagnated or are declining.
Other materials such as plastic, alu-
minum, and steel, have been intensive
competition for many glass markets
in recent years. Thus, the glass con-
tainer industry's future growth ap-
pears to be tied directly to its suc-
cess in nonreturnable beer and soft
drink containers.
textiles
In 1968, nearly 5.7 million tons of
textiles were consumed in the United
States; 246,000 tons—or 4.3 percent
of consumption—were recycled. About
40 percent of total consumption went
into clothing, followed by home fur-
nishings, other consumer products, and
industrial uses. Consumption of tex-
tiles has risen steadily in recent years.
The single most significant change has
been the phenomenal growth of man-
made fibers at the expense of cotton
and wool. From holding 24.4 percent
of the market in 1960, manmade fibers
had grown to 45.8 percent by 1968. The
advent of synthetic fibers has been sig-
nificant not only because they cap-
tured markets formerly held by cot-
ton and wool but also because they
have reached the market in combina-
tion with other fibers, thus making
the job of sorting more difficult.
Textile wastes are recovered from
operations that convert finished tex-
tiles into clothing and other prod-
ucts and from collection of old clothes
by social service agencies. Textiles
represent only about 0.6 percent by
weight of municipal wastes. Very little
scrap is recycled back into new tex-
tile products. Most textile wastes are
either exported (and may then be
recycled), converted to wiping ma-
terial, or reused in making paper and
29
-------
retreading is principal form
off rubber recycling
board products, stuffings, fillings, back-
ings, and paddings. Large quantities
of textiles collected from households
by social welfare agencies are sold in
secondhand stores to reenter the waste
stream at a later date.
Recycling of textiles is declining, in
part because textile wastes are used
in declining rates in paper and board,
in part because the use of pure cot-
ton, the most desirable fraction of
textile wastes, is decreasing.
rubber
In 1969, 3.9 million tons of rubber
(natural and synthetic) were consumed
in the United States, about two-thirds
of it in the form of rubber tires. About
1 million tons were recovered—26.2
percent of total consumption.
There are three forms of rubber
recycling—reclaiming, tiresplitting, and
retreading, the principal form. Re-
treaded tires, however, are losing mar-
kets to new tires; this decline is ex-
-------
pected to continue. The decreasing use
of retreads is a reflection of growing
affluence, competition from synthetic
rubber tires specifically designed and
priced to be competitive in the re-
tread market, and technical problems
within the retreading industry that
have increased costs.
About 1 percent by weight of col-
lected municipal wastes is rubber,
mostly tires. Though largely rubber,
tires are composites of several mate-
rials. Removing these other materials
and reclaiming the rubber is cheaper
than producing virgin rubber, but the
savings are not great enough to com-
pensate for the technical limitations
of reclaimed rubber. Consequently, rub-
ber reclaiming, which is responsible
for 24 percent of all rubber recovered,
is declining. With this decline, the
rubber content of solid wastes can be
expected to rise. Use of waste rubber
to produce new materials or energy
appears to offer the best hope of re-
covering the resource values in waste
rubber. The technology to do this is
under development but it still is un-
proved in the marketplace. Another
problem is the cost of collecting old
tires and transporting them to central
processing facilities.
plastics
Consumption of plastics has in-
creased dramatically in recent years
and is expected to continue to in-
crease. Consumption was 8.5 million
tons in 1969 and should reach 19
million tons by 1980. Although plastics
were only about 1 percent by weight
of collected municipal wastes in 1968,
they are increasing rapidly because
their use is growing in consumer prod-
ucts, especially packaging.
Large quantities of scrap are pro-
duced when plastics are fabricated—
as high as 30 percent in some cases.
Only a small market exists for fabri-
cation wastes, so that many fabrica-
tors haul their scrap to dumps and
sanitary landfills. Nor are obsolete
plastics recycled. The immense num-
ber of different formulations—for ex-
ample, there are over 700 different
grades of polyethylene alone—and the
near impossibility of sorting these ma-
terials after discard prevent their re-
use.
A fundamental obstacle to plastics
recovery and reuse springs directly
from their synthetic origin. Unlike
metals processing, which begins with
impure ore and purifies it, plastics
processing begins with high purity
materials to which new materials are
added. A production process based on
purification can accept scrap and treat
it as though it were partially proc-
essed ore. Practical means of removing
unwanted contaminants from plastics
are still largely nonexistent.
The rapid growth of plastics and the
very major barriers to their recovery
suggest that plastics in waste may
best be used by burning them and
recovering the heat. Plastics—largely
packaging materials—have the highest
heat value of any material commonly
found in municipal wastes. Should
recovering the heat from municipal
waste come into use, the presence of
plastics will be beneficial.
31
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POLICIES FOR THE FUTURE
The situation in recycling today is
that secondary materials have difficulty
competing against virgin materials,
which generally cost less. In earlier
decades, wastes were not available in
large enough quantities to satisfy de-
mand for materials, while virgin ma-
terials were abundant. The mining (or
harvesting), purifying, upgrading, and
processing of virgin materials made
dramatic technological and economic
strides forward. At the same time,
scrap recovery techniques—in the
broad sense of acquiring, upgrading,
processing, and distributing—remained
primitive and expensive.
Virgin materials cost less because
the market price reflects only pro-
duction costs. It does not reflect all
the social and economic costs of using
virgin materials, nor does it credit
recycled materials with the benefits
their use creates. Processors of vir-
gin materials enjoy depletion allow-
ances. They do not pay the full costs
of the solid wastes generated or the
damage done to the environment by
32
their mining, harvesting, transporting,
and processing activities. Also, many
raw materials—the bauxite ore from
which aluminum is derived, for ex-
ample—come principally from foreign
sources, and their use contributes to
the Nation's balance of trade prob-
lems.
By contrast, secondary materials get
no credit for conserving natural re-
sources, removing materials from the
solid waste stream, providing materials
whose processing usually pollutes the
environment less than the comparable
processing of virgin materials, and con-
tributing to a favorable balance of
trade.
Improved technology can help lower
the prices of secondary materials, but
more far-reaching changes probably
will be required to bring about greater
use of recycled materials. Our tradi-
tional accounting system will have to
be replaced by one based on the con-
cept of resource conservation, where
resource is defined broadly to include
all the substances, energies, man-
power, and conditions that we value.
A new comprehensive accounting sys-
tem would consider total costs, tan-
gible and intangible, of producing, dis-
tributing, using, and disposing of ma-
terials. Under such a system, virgin
materials might still be better for
some products—it would be clearly
undesirable, for instance, to recycle
an abundant material if doing so re-
quired two or three times more energy,
water, and manpower and generated
more pollution than in obtaining the
same material from natural deposits.
But probably more products would
be "cheaper" if made from secondary
materials.
In the future, we will recycle more
of our wastes. As our natural re-
sources give out, we may have no
other choice. But if the American
people understand the real issues and
roadblocks that stand in the way of
recycling, they can then support the
changes needed—changes in public
attitudes, laws, and policies—to bring
much closer the day when we stop
squandering our natural resources and
heedlessly polluting our environment.
ft U S. GOVERNMENT PRINTING OFFICE • 1973 O - 504- 309 JJ072 1 22
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