EPA-670/5-74-005
September 1974
Socioeconomic Environmental Studies
                     ALUMINUM  AS A  COMPONENT
                             OF SOLID  WASTE  AND
                       A RECOVERABLE RESOURCE

                                 National Environmental Research Center
                                  Office of Research and Development
                                  U.S. Environmental Protection Agency

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                                     EPA-670/5-74-005
                                     September  1974
   ALUMINUM  AS  A  COMPONENT  OF  SOLID  WASTE

         AND A  RECOVERABLE  RESOURCE
                     By

              Ronald  J.  Talley
                     and
             Ri chard  H.  Ongerth

Solid and Hazardous  Waste  Research Laboratory
         Program Element No.  1DA312
   NATIONAL ENVIRONMENTAL RESEARCH CENTER
     OFFICE OF RESEARCH AND DEVELOPMENT
    U.S. ENVIRONMENTAL PROTECTION AGENCY
           CINCINNATI, OHIO  45268

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                           REVIEW NOTICE

     This report has been reviewed by the National Environmental
Research Center - Cincinnati and approved for publication.  Mention
of trade names or commercial products does not constitute endorse-
ment or recommendation for use.
                                  11

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                              FOREWORD
     Man and his environment must be protected from the adverse
effects of pesticides, radiation, noise and other forms of pollution,
and the unwise management of solid waste.   Efforts to protect the
environment require a focus that recognizes the interplay between the
components of our physical environment—air, water, and land.  The
National Environmental Research Centers provide this multidisciplinary
focus through programs engaged in

       •  studies on the effects of environmental contaminants
          on man and the biosphere, and

       •  a search for ways to prevent contamination and to
          recycle valuable resources.

     This study takes a look at aluminum as a component of solid waste
and as a recoverable resource.  Not only does it present important in-
formation about the preservation and wise use of this precious natural
resource, but it also considers the many aspects of aluminum recycling
that relate to air, water, and land pollution.
                                        A.  W.  Breidenbach, Ph.D.
                                        Di rector
                                        National Environmental
                                        Research Center, Cincinnati
                                 iii

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                              ABSTRACT
     This report surveys the production and use of aluminum and its
occurrence in solid waste; the aspects related to resource recovery
are emphasized.  Surveyed are both the primary and secondary aluminum
industries, which produce aluminum from virgin .materials (i.e.  bauxite)
and scrap, respectively.  Supply and demand analysis is used to analyze
fluctuations in scrap prices and implications of increased recovery
of aluminum from solid waste.
                                 iv

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                            TABLE OF CONTENTS


                                                     Page Number

Introduction                                              1

Summary of Findings                                       1

  I.  The Primary Aluminum Industry                       3

      A)  Production cycle                                3
      B)  Industry structure                              3
      C)  Demand  and  markets for aluminum               3
      D)  Environmental aspects                           5
      E)  Foreign aspects                                 5
      F)  Trends           ,                               7

 II.  The Secondary Industry                              7

      A)  Production cycle                                7
      B)  Demand for secondary aluminum                  15
      C)  Industry structure, competition, and prices    16
      D)  External competition                           20
      E)  Environmental considerations: air pollution    20
      F)  Trends                                         21
      6)  Scrap price fluctuations                       21

III.  Aluminum in Solid Waste                            22

      A)  Quantity and sources                           22
      B)  Disposal problems                              22
      C)  Aluminum recovery from solid waste             24

Footnotes                                                28

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                                TABLES

                                                    Page Number
1.  Aluminum Product Shipments by Major Market            4
2.  Prices of 99%+ Virgin Aluminum, 1961-1972             6
3.  Forecasts of Aluminum Demand by End Use in the        8
    Year 2000
4.  Aluminum Scrap Recovery, 1943-72                      9
5.  Old Aluminum Scrap Recycling, 1969                   14
6.  Scrap Aluminum Prices:   New Clippings  and Cast       17
    Aluminum Scrap
7.  Secondary Aluminum Ingot Prices                      19
                                  vi

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                               FIGURES
                                                    Page  Number
1.  Recovery of aluminum scrap, 1943-72:   new scrap,     11
    old scrap, and total
2.  Aluminum scrap recovery flow                         13
3.  Aluminum scrap prices                                18
4.  Equilibrium price changes and price elasticities     23
    of supply and demand
5.  Market analysis of an increase in supply             26
                                   vii

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                              INTRODUCTION

      Increased recycling is one aspect of the heightened environmental
concern in the United States today.  The object is to channel the
materials and potential  energy in refuse away from incinerators, dumps,
and landfills, and into the creation of useful products.

      Federal action in the recycling area was initiated by the Resource
Recovery Act of 1970, which was enacted on October 26, 1970 (Public
Law 91-512, 91st Congress, H.R. 11833).  The Act calls for the
Environmental Protection Agency to report to Congress on the present
situation and on the needs and possibilities for increased recycling
of solid wastes.  This study of aluminum is in support of that legis-
lative mandate.  It presents a broad overview of the production and
use of aluminum in the United States, with emphasis on aluminum in
solid waste (especially municipal refuse) and recycling.   The approach
is economics oriented, since profit is the main determinant of the
degree of resource recovery today.

                          SUMMARY OF FINDINGS

                     The Primary Aluminum Industry

      The three largest markets for primary aluminum in 1972 were
building and construction, transportation, and containers and packag-
ing.  Total shipments grew at an average annual rate of 8 percent
during the period 1960-72, with individual domestic markets growing
at rates ranging from 6.6 percent for consumer durables to 15.5 percent
for containers and packaging.

      The demand for aluminum is relatively insensitive to price changes
in the short run, but fairly sensitive in the long run.  The average
annual growth rate for aluminum demand is expected to decrease from
about 8 percent during the past 25 years to about 6 percent over the
next 25 years or so.

      The earth has abundant deposits of the necessary raw materials
for aluminum production.  In fact, aluminum is the most abundant
metallic element in the earth's crust.  The United States imports
most of its bauxite needs.  Primary aluminum production uses tremen-
dous amounts of electric energy.  Estimates indicate that the average
annual cost of additional air and water pollution controls for the
primary aluminum industry will reach $50 per ton of production by
1977.

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                                   - 2 -


                       Secondary Aluminum Industry

       Scrap recovery has grown at an average annual rate of about 7
 percent since 1950.  This growth is due largely to a near 8 percent
 rate of increase in recovery of new scrap (that produced by manufactur-
 ing processes).   Recovery of old scrap (that salvaged from discarded
 products) increased at a 5.5 percent average annual rate.

       Total domestic scrap recovery has yielded about 25 to 30 percent
 as much aluminum as primary production in recent years.   Recovery of
 old scrap has accounted for about 20 percent of total scrap recovery.
 The scrap recovery flow in the United States includes the operations
 of scrap dealers, secondary smelters, nonintegrated foundries  and
 fabricators, and integrated primary producers.   Approximately  70  per-
 cent of all scrap recovered, and probably all  old scrap, goes  to
 secondary smelters who produce specification secondary aluminum.
 Nearly 90 percent of this product goes to foundries to make castings,
 which are used in durable items, primarily automobiles and other
 transportation products.   Recent estimates indicate that only  a small
 fraction (less than 15 percent)  of the old aluminum scrap generated
 is recovered.

       Aluminum scrap prices fluctuate widely,  a  fact that creates un-
 certainty about  future prices,  revenues,  and profits and tends to
 discourage capital  investment in the scrap business.   The wide price
 fluctuations  may be partially explained by price-inelastic demand and
 supply of scrap.

       Estimates  indicate  that the  average  annual  costs of air pollution
 controls  for  secondary  smelters  would  be about $6.34 per ton of pro-
 duction  by 1977,  considerably less than the  estimated  costs of pollu-
 tion  controls  for primary producers.

       Demand  for  secondary  aluminum  is expected  to  grow  at an average
 annual  rate of almost 8 percent  during the next  25 years  or so.

                        Aluminum in  Solid Waste

       By weight,  aluminum represents a very  small fraction of collec-
ted municipal  refuse  (estimates are  in the range of  approximately
0.5 to 1 percent, or approximately 600,000 to 900,000 tons annually).
Much of this aluminum is  in container and packaging  items.  The major
solid waste problem associated with  aluminum is the  littering of  such
i terns.

      Aluminum is among the most valuable component materials of muni-
cipal refuse in terms of scrap price, typically selling for 15 to 20
times the price of scrap steel, glass, or paper.  However, costs of
separation and scrap processing inhibit aluminum recovery to the point
that relatively little aluminum is now diverted from the municipal

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                                  - 3 -
refuse cycle.  Most of that which is diverted is recovered through
can reclamation programs aimed at recovering all-aluminum beverage cans.

      The effect of an increase in the supply of reclaimed aluminum
depends on the nature of demand.  A substantial  increase in aluminum
recovery would very likely result in sharp price declines if accom-
plished in a short period of time; but if it were accomplished over a
long period of time, it is likely that it would have relatively little
effect on price because of the probable differences in price elasti-
cities of demand in the short and long run.

                     THE PRIMARY ALUMINUM INDUSTRY

                            Production Cycle

      Aluminum is produced from alumina, an  aluminum oxide refined
from bauxite, in an electrolytic process.  Costs of production are for
alumina (30 percent of the total), other raw materials (15 percent),
electricity (16 percent), labor (14 percent), capital (20 percent),
and overhead and other operating expenses (5 percent).1  Electric
energy is very important--!3,000 to 18,000 kw-hr are used per ton of
aluminum output.  Technology has not changed significantly since the
industry's beginnings in 1888.  Bauxite is refined into alumina through
a chemical oxidation process, the Bayer process; alumina is then re-
duced to aluminum by the electrolytic Hall-Heroult process.

                           Industry Structure

      The domestic industry has evolved from a monopoly (pre-World War
II) by the Aluminum Company of America (Alcoa) to a structural oligo-
poly2 .  There are now 12 firms, 3 of which  control 68 percent of in-
dustry capacity (Alcoa, Reynolds, and Kaiser).
                    i
                    Demand and Markets for Aluminum

      Aluminum is a very versatile material, with a wide range of pro-
perties and applications.  It is a light-weight (low-density) metal
with a high strength/weight ratio.  It has strong corrosion resis-
tance and good thermal and electrical conductivity.  The metal has
high reflectivity, is very ductile, and is also nontoxic, easily
coated or painted, and is generally easily combined (especially as
foil) with a variety of other materials.

      A breakdown of the specific markets for aluminum in recent years
is given in Table 1.

      Aluminum demand is fairly insensitive  to short-run price vari-
ations (i.e., it is "price-inelastic"), but  it is responsive to long-
run price changes (i.e., it is "price-elastic" in the long run)3.

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                                 - 4 -







                                TABLE 1





              ALUMINUM PRODUCT SHIPMENTS BY MAJOR MARKET*
Building & Construc-
tion
Transportation
Consumer Durables
Electrical
Machinery & Equipment
Containers & Packag-
ing
Exports
Other
TOTAL
*Aluminum Statistical
Percent
1960
25.7
18.1
10.8
11.2
7.0
6.8
13.0
7.4
of Total
1966
22.0
21.6
10.1
14.4
7.2
8.2
6.5
10.1
Shipments
1972
26.4
18.5
9.2
12.7
6.1
15.2
4.7
7.1
Review 1972 (New York: The
1960-1972 Annual
Growth Rate (%)
8.3
8.3
6.6
9.2
6.8
15.5
-0.8
7.8
8.0
Aluminum Association,
1973).

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                                - 5 -
Frequent price changes themselves adversely affect the demand for any
material because of the uncertainty they create about the future price,
uncertainty which discourages capital  investments necessary to use the
material.  Therefore, in the best long-run interest of the industry,
the largest aluminum producers generally try to minimize price fluc-
tuations, particularly short-run price increases.  The record of price
movements during the period 1961-72 is given in Table 2.

                       Environmental  Aspects

     At the beginning of the production cycle, restoration of mined-
out, open-pit areas is becoming increasingly important in bauxite-
producing countries.  Once extracted,  the refining of bauxite into
alumina results in the production of a finely divided residue (red
mud tailings).  About 5.5 million tons of this waste material are
generated annually at eight alumina plants located along the lower
Mississippi River, the Gulf Coast, and in Central Arkansas.  At most
plants, the red mud is impounded in large mud lakes adjacent to the
plants, although some is discharged into the Mississippi River and
some is used in industrial applications (e.g., cement making).

     Air pollution from primary aluminum production consists mainly
of particulates and fluorides.  Aluminum plants are estimated to have
emitted 31,800 tons of particulates in 1967 at a 73 percent level of
control.  To meet applicable participate emission standards, the level
of control must be raised to approximately 98 percent, a level at
which the aluminum industry will incur an estimated annual cost of
$44.14 per ton of production in fiscal 1977.  This cost will vary con-
siderably, depending on the specific production process used at a
given plant.1*  Water pollution controls should be relatively less
costly, and together, the average annual cost of additional air and
water pollution controls should reach $50 per ton of production by
1977.5

                          Foreign Aspects

     The United States imports most of its bauxite needs (about 85-90
percent), mainly from Jamaica, Surinam, and Guyana.  The remainder is
mined domestically in Arkansas.  Alumina needs are met by refining
about 80 percent of it domestically and importing the rest.  In 1972,
U.S. production represented approximately 34 percent of the world's
total production of primary aluminum, and the United States and
Canada combined accounted for about 43 percent.  The United States is
a net importer of primary aluminum: for 1962-72, exports averaged
about 7.3 percent of total net shipments by U.S. producers, and
imports averaged 12.5 percent implying net imports of a little over 5
percent.

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                                    - 6  -
                                 TABLE 2
                 PRICES OF 99%+ VIRGIN ALUMINUM, 1961 - 1972
Year
1961
1962
1963
1964
1965
1966
1967
1968
1969
1970
1971
1972

Range of
monthly average
24.00 - 26.00
22.54 - 24.00
22.50 - 23.00
23.00 - 24.34
24.50
24.50
24.74 - 25.00
25.00 - 26.00
26.55 - 28.00
28.00 - 29.00
29.00
25.00 - 29.00
List price, N.Y
Number of
price changes
2
1
3
6
1
0
2
2
4
2
0
2
*
•
Average for
the year
25.46
23.88
22.62
23.72
24.50
24.50
24.98
25.57
27.18
28.71
29.00
26.45
Price realizationt(4/lb.}
Alcan
22.2
21.2
20.4
23.3
24.2
24.3
24.1
22.0
23.0
24.5
22.7
22.6
Alcoa
25.3
23.9
22.2
23.2
23.5
23.9
+
23.6
24.8
26.8
23.9
t

*Source:  Metal Statistics 1973 (New York: Fairchaild Publications, 1973).

tThe difference between list price and realized price is the discount
 offered to buyers by producers.   Realized prices for Alcan and Alcoa were
 computed from company statements.  (Source:   Standard and Poor's  Industry
 Surveys, Metals - Nonferrous:   Basic Analysis, 7/12/73 [Section 2], p.M170)

+Not available.

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                                 - 7 -
                                Trends

      The primary aluminum industry has grown at an average annual
rate of 8.2 percent during the period 1947-72.  Although the rate is
expected to slow somewhat, the industry should continue to grow.   The
U.S. Bureau of Mines forecasts a "probable" growth in U.S. aluminum
demand of 6.1 percent per year during the period 1972-2000.6  The
forecasts for individual markets are given in Table 3.

      Aluminum is the most abundant metallic element in the earth's
crust and, in general, raw materials for aluminum production should
be in plentiful supply for the foreseeable future.  The cost of
electric energy may rise significantly in the future, thus increasing
the cost of aluminum production.  Technological  changes in the indus-
try can be expected, and they may reduce electric power needs; but
major changes are likely to occur gradually.

      Competition from substitute materials is a key determining
factor of the aluminum industry's future.  The traditional rival
materials have been steel and copper, and recently plastics have been
competing in many present and potential aluminum markets.   Much of
the aluminum industry's gains over the years have been at the expense
of the steel industry, and the two industries are still actively com-
peting in a number of markets: for example, the  transportation market
(for automotive, rail, and aircraft applications), and the beverage
container market.  Copper originally held what are now some of the
largest markets for aluminum (e.g., electrical applications), and
aluminum is presently threatening the market for copper in automobile
radiators, air conditioning, and other tubing.  Plastics are challeng-
ing the hold of aluminum on its largest markets: construction, packag-
ing, and transportation.  Other actual or potential competitive
materials are magnesium, titanium, and sodium.

                        THE SECONDARY INDUSTRY

                           Production Cycle

      Secondary aluminum is made from aluminum scrap.  Aluminum scrap
is characterized as either "new" or "old".  New scrap is that genera-
ted in a manufacturing process, and old scrap comes from discarded,
used products containing aluminum.  Annual aluminum scrap recovery
figures for 1943-72 are given in Table 4 and are plotted in Figure 1.

      Both new and old scrap recovery have shown an upward trend during
the post-World War II period, and both were significantly affected by
war-related aluminum production.  Total scrap recovery increased at an
average annual rate of 7.2 percent from 1950 until 1972, largely be-
cause of a 7.8 percent average annual rate of increase for new scrap

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                                  - 8 -


                                  TABLE 3


        FORECASTS OF ALUMINUM DEMAND BY END USE IN THE YEAR 2000*

Aluminum content
End use In thousands of short tons
Metal
Construction materials
Transportation equipment
Electrical equipment
Cans and containers
Consumer durables
Industrial machinery
Other
Total
Non-Metal
Abrasives
Refractories
Industrial chemicals and others
Total

5,400
6,000
5,000
4,000 ,
2,500
1,200
1.800
25,900

300
1,000
1,200
2,500
Ave. annual growth
1972-2000 (%)

5.2
6.9
7.7
6.2
6.3
5.0
6.0
6.3

4.3
6.4
5.1
5.1
*Source:  Division of Nonferrous Metals, Bureau of Mines,  U.S.  Department
 of the Interior.

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            TABLE 4
ALUMINUM SCRAP RECOVERY, 1943-72*

Year
1943
1944
1945
1946
1947
1948
1949
1950
1951
1952
1953
1954
1955
1956
1957
1958
1959
1960
1961
1962
1963
1964
1965
Amount
(In thousands
Total
domestic
scrapt
314.0
325.6
298.4
278.1
344.8
286.8
180.8
243.7
292.6
304.5
368.6
313.0
414.0
428.0
445.0
354.0
449.0
438.0
485.0
582.0
654.0
707.0
829.0
recovered
of short
New
scrap
280.9
302.7
271.1
187.5
181.0
191.1
136.2
167.3
216.0
233.3
289.6
246.6
314.5
331.0
347.5
274.5
345.0
343.0
329.5
415.5
495.0
545.0
624.0
tons)
Old
scrap
33.1
22.9
27.3
90.5
163.8
95.6
44.6
76.4
76.6
71.3
78.9
66.4
99.5
97.0
97.5
79.5
104.0
95.0
155.5
166.5
159.0
162.0
205.0
Imports*
(negligible)
1.5
4.5
13.0
14.0
64.5
36.0
61.0
18.0
6.5
24.0
7.5
19.5
10.5
12.0
9.0
10.0
4.5
5.5
6.0
8.5
7.5
24.5
Total domestic scrap
as a % of domestic
primary aluminum
production
34.1
41.9
60.3
67.8
60.3
46.0
19.9
33.8
34.9
32.4
29.4
21.4
26.4
25.4
27.0
22.6
22.9
21.7
25.4
27.4
28.2
27.6
30.0
Old scrap as
a % of total
10.5
7.0
9.1
32.5
47.5
33.3
24.6
31.3
26.1
23.4
21.4
21.2
24.0
22.6
21.9
22.4
23.1
21.6
32.0
28.6
24.3
22.9
24.7
                                                                         I
                                                                         VD

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                                            TABLE 4
                                ALUMINUM SCRAP RECOVERY, 1943-72*
                                            (Continued)
                   Amount  recovered
             (In  thousands of short  tons)
Total domestic scrap
Year
1966
1967
1968
1969
1970
1971
1972
Total
domestic
scrapt
887.5
878.0
997.0
1150.0
1000.0
1050.0
1126.0
New
scrap
700.3
703.5
816.0
950.0
803.0
834.0
876.0
Old
scrap
187.3
174.5
181.0
200.0
197.0
216.0
250.0
Imports*
30.5
27.5
34.0
26.0
33.0
56.5
47.0
as a % of domestic
primary aluminum
production
29.8
26.8
30.6
30.3
25.2
26.8
27.3
Old scrap as
a % of total
21.1
19.8
18.1
17.4
19.7
20.6
22.2

*Source:  Aluminum Statistical  Review 1972 (New York:  The  Aluminum Association,  1973).

tAs reported 1945-54; estimates expanded from reported figures,  1955-70.   Also,  beginning  1954,
 figures cover aluminum content and thus are not strictly  comparable  with  data for  previous years
 which covered recoverable aluminum-alloy content.   Recovery from sweated  pig is  included  in new
 scrap during 1945-60, and in old scrap during 1961-72.

tRecovery from imported scrap equals 90 percent of  reported  scrap imports.
                                                                                                         o

                                                                                                         I

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    1945
1970
Figure 1. Recovery of aluminum scrap, 1943-72: new scrap, old scrap, and total.

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                                - 12 -
 recovery,  as old scrap recovery increased at an average annual rate of
 5.5  percent.  Old scrap's share of total scrap recovery was largest
 during the immediate post-war years of 1946-50, averaging 33.8 percent,
 as compared to 22.7 percent for 1951-72.

      Scrap Recovery Flow.  The production of aluminum from scrap in-
 volves several distinct industries: scrap dealers, secondary smelters,
 non-integrated foundries and fabricators, and the integrated primary
 producers.  How each fits into the total secondary aluminum picture
 is shown in Figure 2, a schematic diagram of the scrap recovery flow.

      New scrap is usually identified as to composition, fairly clean,
 and  generated in volume.  It is classified, according to its physical
 form, into three categories: (a) borings and turnings (from machining
 and  drilling processes), (b) new clippings, forgings, and other solids,
 and  (c) residues such as dross, skimmings, and slag (from various melt-
 ing  operations).

      Old aluminum scrap generation and recovery (by product market
 source) have been estimated in a recent study based on historical pro-
 duction figures for seven market categories of aluminum products and
 an assumed useful lifespan for each.7  The quantity of aluminum re-
 covered in each market category was also estimated (Table 5).   Although
 subject to a fairly wide range of error, these estimates do indicate
 the  orders of magnitude involved.   Only a relatively small  fraction
 (less than 15 percent) of the old aluminum scrap generated is  recovered,
 and  the quantity of unrecovered old scrap is equal to about 30 percent
 of U.S. domestic production.  The three largest sources of the unrecov-
 ered old scrap (containers and packaging, transportation, and  consumer
 durables)  account for 75 percent of the total  not recovered.   One
 source, transportation products, accounts for over half of all old
 scrap recovered.   The smallest quantity of unrecovered old scrap is
 from the electrical  category, which has the highest recovery rate;
 conversely, the largest quantity of unrecovered scrap is from  the
 category with the lowest recovery rate, containers and packaging.

     Aluminum Recovery Industries.   The Scrap Industry.   The scrap
 business includes collectors, dealers; brokers and processors.  Thou-
 sands of scrap collectors seek out  scrap materials of all  types and
 sell  them to a dealer when they have accumulated a sufficient  quantity.
New aluminum scrap is usually accumulated by the generators and sold
to dealers.  Most dealers specialize to some degree,  and dealers in
aluminum scrap typically specialize in nonferrous metals.   Dealers
commonly perform the  following functions: collection,  identification,
 sorting, processing,  packing, storing, and shipping.   Identification
of scrap composition  is very important, and since most aluminum alloys
 look  alike, if the alloy is  not indicated or identifiable through the
sellers, the dealer must identify it,  through  his own  general  knowledge

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     OLD
    SCRAP

   (20% OF
   TOTAL)
              ZINC DIE
              CASTERS
                                                         (TIME LAG) =
SECONDARY
 SMELTERS

 (70% OF
  TOTAL)
10%
                          K12% OF TOTAL
                            ALUMINUM
                            PRODUCTS

                              5,050
                            THOUSAND
                              TONS
                              (1970)
                                   PRIMARY PRODUCERS
                                   (CONSUMED 13% OF
                                   TOTAL SCRAP),
                                     NONINTEGRATED
                                   FOUNDRIES AND OTHER
                                   FABRICATORS  07%)
Figure 2. Aluminum scrap  recovery flow. (Total  scrap recovery for 1970
         was 950,000 tons.) Percentages are based on 1967 estimates from
         Arsen Darney and William E. Franklin,  Salvage Markets for
         Materials in Solid Waste. U.S. Environmental Protection Agency, 1972.
         (Washington, D.C.: U.S. Government Printing  Office), Chapter VI
         ("Nonferrous Metals1').
                                        CO

                                        I

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                                                TABLE  5
                                   OLD ALUMINUM SCRAP  RECYCLING,  1969*

Market
category
Building &
construction
Transportation
Consumer
durables
Electrical
Machinery and
equipment
Containers and
packaging
Other
Total
*Source: Tables
Assumed
life span
(years)
30
10
10
50
20
<1
10
13 and B-l of
Estimated
discarded
aluminum
(tons)
71 ,000
329,000
197,000
7,000
61 ,000
486,000
183,000
1,334,000
Study to Identify
Estimated
old aluminum
recovered (tons)
9,000
100,000
25,000
6,500
15,000
2,000
17,500
175,000
Opportunities for
Estimated
percent
recovered
12.7
30.4
12.7
92.9
24.6
0.4
9.2
13.1
Increased Solid
Estimated
aluminum not
recovered (tons)
62,000
229,000
172,000
500
46,000
484 ,000
165,500
1,159,000
Waste Utiliza-
tion, Battelle Memorial  Institute, U.S.  Environmental  Protection Agency,  1972,  (National Technical
Information Service, PB-212 730).

-------
                                 - 15 -
of the alloys used in the manufacture of various  aluminum products,
or chemical and spectraprobic tests.   Standard identification numbers
are used to identify and sort scrap according to  about 20 general
categories.  Once identified and sorted, scrap is processed into a
form acceptable to users.  Processing involves steps such as cleaning
and drying, shredding, crushing, screening, magnetic separation,
"sweating", and cable stripping and chopping.  Dealers package scrap
for shipment by baling or briquetting.

      Secondary Smelters.  Secondary smelters remelt scrap materials,
remove the impurities, and produce specification  secondary aluminum.
The production process consists of charging scrap into a reverbatory
furnace, sampling the molten metal to determine its composition, and
introducing any necessary additional  compounds (e.g., silicon and
copper) and aluminum to bring the melt to specification.  Then mag-
nesium is removed and the molten aluminum is degassed.

      Foundries.  Approximately 90 percent of the output of secondary
smelters goes to foundries that make aluminum castings.  Castings are
produced by three methods: die casting, permanent mold casting, and
sand casting.  In die casting, molten metal is forced into locked
steel die chambers and cooled; the die is unlocked and the casting
ejected when the metal has solidified.  The castings are then trimmed
of excess material and further finished for sale.  Die casting is a
high-volume, low unit cost method of production.   Permanent mold cast-
ing has a lower tooling cost and can produce shapes that can't be die
cast.  Permanent mold castings do require considerable machining,
however.  The widest application of permanent mold casting is for
automotive and diesel pistons.  Sand casting is used mainly for un-
usually large castings or if only a small number of castings are to
be made.

      Total castings shipments grew at an average annual rate of
about 6 percent during 1946-72, mostly because of the tremendous
growth in die castings shipments.  In recent years, die castings have
accounted for a little more than 60 percent of total castings ship-
ments, while permanent semi-permanent mold castings represented almost
25 percent, and sand castings a little less than 15 percent.

                    Demand for Secondary Aluminum

      The demand for secondary aluminum is derived  from the demand
for products that can be made entirely or  in part from secondary
aluminum.  There are three basic categories of final demand for
secondary aluminum: primary products other than  castings,  deoxidizing
uses in steel production, and products that use  castings.  The  first
category generally  uses  exactly identified, segregated,  clean,  new
scrap.  This demand for  scrap probably represents about  30 percent  of
total purchased scrap.   Aluminum's strong  affinity  for  oxygen makes it

-------
                                 - 16  -
 a  good deoxidizing agent in steel production, and this use accounts
 for  about  7 percent of total recycled purchased scrap (about 10 percent
 of the output of all secondary smelters).  Aluminum castings are the
 main market for secondary aluminum, and foundries account for about
 90 percent of the output of secondary smelters (or 70 percent of all
 purchased  scrap).  Castings go into durable items, primarily automo-
 biles and  other transportation products.  Home appliances and indus-
 trial and  commercial equipment also use significant quantities of
 aluminum castings.

            Industry Structure, Competition, and Prices

     Scrap Dealers.  The nonferrous scrap industry is composed of
 thousands  of dealers, each operating in a relatively restricted geo-
 graphic area (within a 100- to 200-mile radius).   The industry appears
 to be a rather competitive one.  There are many firms in the industry,
 the  products are fairly standardized and homogeneous, the industry is
 not  dominated by a few giants, and barriers to entry by new firms are
 not  unusually large.

     Aluminum scrap prices fluctuate widely.  The record of price
 movements  during 1 53-72 is given in Table 6 and Figure 3.8  Scrap,
 prices varied as much as 51 percent from year to year, and the average
 (absolute) percentage change (year to year) was 13 percent for new
 clippings  and 17 percent for cast aluminum.

     Secondary Smelters.  Secondary smelters are located in indus-
 trial areas such as those surrounding Chicago, Cleveland, New York,
 Philadelphia, and Los Angeles, near their main customers (foundries)
 and  scrap  sources.  Although shipping costs do tend to create oligo-
 polistic regional  submarkets, there is some nationwide competition.
 Nationwide concentration ratios are as follows:9

             Largest firms            Percent of total industry
                                               production

                    2                              30

                    6                              60

                   19                              75

                   31                               90

     The price history of secondary ingots during 1957-69 is given in
Table 7.10 The largest year-to-year (annual average) price change was
 the  9.8 percent increase from 1964 to 1965, and the average (absolute)
 percentage change year-to-year was 4 percent.

-------
                                - 17 -


                                TABLE 6
                SCRAP ALUMINUM PRICES:  NEW CLIPPINGS
                       AND CAST ALUMINUM SCRAP*

New clippings
Year

1953
1954
1955
1956
1957
1958
1959
1960
1961
1962
1963
1964
1965
1966
1967
1968
1969
1970
1971
1972
Range Average
High
14.00
14.50
20.36
20.50
14.88
13.52
15.25
15.25
12.50
11.50
12.12
12.37
16.42
14.15
11.50
11.35
14.75
12.49
8.75
7.75
Low
10.50
11.25
14.79
14.85
13.75
12.75
13.25
11.75
11.50
10.00
10.00
12.12
12.37
11.25
9.25
9.75
10.02
8.75
7.25
7.25

12.57
13.12
17.93
16.99
14.07
12.97
14.40
13.55
11.92
11.05
11.56
12.29
14.68
12.76
10.49
10.08
13.04
10.94
8.34
7.52
percent
change

4.4
36.7
-5.2
-17.2
-7.8
11.0
-6.3
-12.0
-7.3
4.6
6.3
19.4
-13.1
-17.8
-3.9
29.4
-16.1
-23.8
-9.8
*Source: Metal Statistics 1973 (New
Cast aluminum scrap
Range
High
10.00
11.00
17.75
17.00
11.64
10.34
11.50
11.50
9.75
9.25
8.75
10.87
13.23
11.25
11.25
9.50
12.50
11.24
7.75
5.75
Low
7.50
8.75
11.29
11.44
10.25
9.25
9.75
8.75
8.75
7.25
7.25
8.75
10.87
9.21
7.25
8.00
8.27
7.25
5.25
5.25
York: Fairchild
Average

9.10
10.14
15.34
13.99
10.86
9.76
10.75
10.25
9.40
8.70
8.33
10.13
12.15
10.30
8.40
8.41
11.48
9.79
7.00
5.52
Percent
change

11.4
51.3
-8.8
-22.4
-10.1
10.1
-4.7
-8.3
-7.5
-4.3
21.6
19.9
-15.2
-18.5
0.1
36.5
-14.7
-28.5
-21.1
Publications,
1973), pp. 77-8.Prices are dealers' buying prices in New York;
monthly averages are compiled from quotations published daily in the
American Metal Market.  Prices are in cents per pound.

-------
                                     -  18  -
   20.0
Q
3
2
   16.0
5  '2.0
u
    8.0
                                 NEW CLIPPINGS
                                   (—SCALE)
              I   ,
                             CAST ALUMINUM SCRAP
                                   (SCALE*-)
                             I
                1
                                               I  I   I
             1955
1960           1965
       YEAR
                                                          1970
                                                                     16.0
                                                                     12.0
                                                                          a.
                                                                          ac
                                                                          UJ
                                                                          a.
                                                                     8.0
  -J4.0
^
                    Figure  3. Aluminum  scrap prices.

-------
            -19  -






          TABLE 7



SECONDARY ALUMINUM INGOT PRICES*


Year
1957
1958
1959
1960
1961
1962
1963
1964
1965
1966
1967
1968
1969
1970
1971
1972
*Source:
1973),
lished
No. 380
Range
High Low
23.46 21.62
22.87 21.75
24.82 22.25
25.50 23.50
23.50 21.77
21.50 20.17
21.75 20.25
22.72 21.75
24.75 22.75
24.75 24.68
24.75 24.75
25.50 24.75
27.00 26.00
28.00 27.00
28.00 27.03
28.00 27.00
Metal Statistics 1973
p. 78. Monthly averages
in American Metal Market
alloy.
Average

22.70
22.06
23.44
24.67
22.56
21.20
21.01
22.05
24.21
24.74
24.75
25.02
26.82
27.72
27.92
27.72
(New York: Fairchild
compiled from daily
Percent change


-2.8
6.3
5.2
-8.6
-6.0
-0.9
5.0
9.8
2.2
0.0
1.1
7.2
3.4
0.7
-0.7
Publications,
quotations pub-
. Prices are in cents per pound for



-------
                                - 20 -
     Foundries.  The aluminum castings industry is made up of inde-
pendent "custom" shops, and "captive" shops.  Captive shops are
foundries owned and operated by large manufacturing firms, mainly in
the automotive and appliance industries.  In recent years, these
foundries have produced about half of all aluminum castings in the
United States.  Overall, the industry is fairly competitive, with over
a thousand shops nationwide and no dominating giants. Foundries tend
to locate in industrial areas, and die casting shops in particular are
concentrated in the Great Lakes region from Chicago to Cleveland.

                         External Competition

     Competition with the Primary Industry.  Although the primary and
secondary aluminum industries both produce alloys of the same basic
metal, competition between them is limited by the narrow product line
of the secondary smelter.  Most aluminum products are not and cannot
be made from secondary aluminum as it is produced today.  However, the
primary producers can and do produce the same specification ingot as
that produced by the secondary industry.  Consequently, competition
between the primary and secondary producers is a relatively much more
important factor for the secondary producers.  In the secondary indus-
try's main market, castings, secondary producers have been supplying
about three-fourths of the metal, and primary producers one-fourth.
In steel deoxidizing, the needs have been met by about equal shares of
primary and secondary metal.11  Competition from the primary producers
increases in slack times for the primary industry.

     Secondary smelters also compete with the primary industry for
scrap input.  In recent years, the primary producers have consumed
about 20 percent of purchased new scrap in the United States, although
this figure varied between about 9 percent (in 1962-63) and 40 percent
(in 1953).12

     Imports/Exports.  Foreign trade is a fairly minor factor in the
U.S. secondary aluminum industry.  For the period 1962-72, recovery
from imported scrap averaged about 3 percent of total domestic re-
covery, and exports averaged about 6 percent.  Exports of aluminum
castings were less than 1 percent of total castings shipments.  Foreign
trade in secondary ingots is also slight.  In addition, there is trade
in finished durable goods that contain aluminum castings (e.g., auto-
mobiles).

             Environmental Considerations: Air Pollution

     Scrap Processing.   In the past, considerable air pollution was
generated in burning off combustible contaminants.  This burning vio-
lates the air pollution codes recently adopted by many communities,
however, and compliance makes the recovery of combustibles-contaminated
scrap more costly.

-------
                                 -21  -
      Secondary Smelters.   In addition to any emissions  from scrap
processing, the secondary  smelter's furnace operations can  also be  a
source of air pollution, primarily from the processes of degassing,
magnesium removal, and cleansing of the molten metal. These steps
are usually accomplished by bubbling chlorine through the molten metal,
a process that results in  gaseous and particulate emissions such as
chlorine, hydrochloric acid, magnesium chloride, aluminum chloride  and
aluminum oxide.  Hydrochloric acid and chlorine gas are  highly acidic
and present potential corrosion and health hazards.  The other three
compounds are particulates.

      Two approaches to air pollution control by secondary  smelters
are input substitution and installation of emission control equipment.
Chlorine-compound emissions can be avoided by using chlorine substi-
tutes.  Nitrogen can be used for degassing, and aluminum fluoride for
magnesium removal and general cleansing, although these  substitutes
tend to be more expensive and less effective than chlorine.

      On the other hand, though, the acidic gases, the submicron par-
ticle size and hygroscopic nature (i.e., absorbing or attracting
moisture from the air) of much of the particulates have  created prob-
lems for control equipment manufacturers.  The smelter's "batch"
process method adds to the difficulties since emission levels fluctu-
ate widely, depending on the production step.  Assuming, nevertheless,
that the pollution control equipment approach is the predominant one
taken (installation of specially designed wet scrubbers), it has been
estimated that the average cost of standards compliance would be about
$6.34 per ton of secondary aluminum.13

                                Trends

      The rate of aluminum scrap generation  depends  on present and
past aluminum production.  Production  is expected  to continue to grow
at a 6 to 7 percent annual rate, implying a  similar  growth  in scrap
generation, assuming the historical relationship of  new scrap genera-
tion to aluminum production  is maintained.   On the demand side, the
Bureau of Mines forecasts  that secondary aluminum  demand through the
year 2000 will probably grow at  an average annual  rate of 7.7 percent.1
This demand for secondary  aluminum relative  to  its most  immediate  sub-
stitute, primary aluminum, should not  be adversely affected by  envi-
ronmental  control costs, as  the  above  estimates  indicate.

                        Scrap Price Fluctuations

      The  extreme price fluctuations  that  aluminum scrap is subject
to create  a  great deal  of  uncertainty  as to  what future  price  levels
will  be.   This  uncertainty about prices  translates into  revenue and
profit  uncertainty,  which  tends  to  discourage capital investment in
the  scrap  business.   Aluminum  scrap  price  fluctuations  are thus

-------
                                  - 22  -
 important determinants  of scrap recovery.   To  better understand  them,
 the following discussion  considers  some  basic  causes of relatively
 large price changes.

       Scrap prices  are  determined by the market  forces  of  supply and
 demand.   In the short run, the  demand for  scrap,  like the  demand for
 aluminum in general,  is probably relatively insensitive to price
 changes  (i.e., it is  price inelastic).   On  the supply side,  it would
 appear that in the  short  run, the scrap  recovery  rate is also rela-
 tively insensitive  to price changes.   That  is to  say, both the short-
 run demand and supply curves15  should be relatively  steeply  sloped.
 Markets  in which both supply and demand  are price inelastic  are  sub-
 ject to  relatively  large  potential  price changes, since shifts in
 either curve  (caused  by changes  in  one or more of the factors held
 constant in constructing  the curves)  will result  in  relatively large
 changes  in the equilibrium price.   This  is  shown  diagrammatically in
 Figure 4,  where equal horizontal shifts  in  demand produce  a  larger
 price change  in a market  of price-inelastic  supply and  demand than in
 a  price-elastic one,  and  similarly  for equal horizontal  shifts in
 supply.

       Relatively price-inelastic supply  and  demand provide,  of course,
 only  a partial  explanation  of the wide fluctuations  in  aluminum  scrap
 prices.  Other important  factors are  changes in the  basic  conditions
 that  produce  supply and demand shifts, and the nature of scrap inven-
 tory  policies.  These policies can  either moderate or accentuate price
 movements.  By adding to  inventories  in  the  face of  slack  demand and
 drawing  down  inventories when demand  is  strong, suppliers  can moderate
 price movements that are due to changes  in demand.  Conversely,  if
 suppliers  draw down inventories when  demand weakens and add to inven-
 tories when demand increases, price fluctuations will be accentuated.

                       ALUMINUM IN SOLID WASTE

                         Quantity and Sources

      By weight, aluminum represents a very small fraction of collec-
ted municipal   refuse; recent estimates range from about 0.5 to 1  per-
cent.16  Still, because  the total is so great, these small  fractions
translate  into fairly large quantities of aluminum, on the order of
600,000 to 900,000 tons.  Most of this aluminum is in the form of
containers and packaging,  although  as much  as one-third of it may be
in discarded consumer durables (appliances, pots  and pans,  lawn fur-
niture, etc.).

                          Disposal  Problems

      The major solid waste problem  associated with aluminum-contain-
ing products is litter of  beverage containers and packaging.  In

-------
                                     - 23 -
                   A) PRICE-INELASTIC SUPPLY AND DEMAND

     (1) SHIFT IN DEMAND                       (2) SHIFT IN SUPPLY
PRICE
  Pe
     D  D'
      Illllllllll
 Illllllllll
PRICE
  Pe
                                            Pe'
                                                             s  s'
                                          Illllllllllllll
                                          Illllllllllllflllll
                      QUANTITY
                                                           QUANTITY
PRICE
  Pe'
  Pe
                 B) PRICE-ELASTIC SUPPLY AND DEMAND

(1) SHIFT IN DEMAND                        (2) SHIFT IN SUPPLY

                                     PRICE
      D  D'
IIHIIIII
iniiiiiiiiiii
   Pe

   Pe'
                                                              S  S'
                      QUANTITY
                                                            QUANTITY
     D = ORIGINAL DEMAND CURVE     Pe = ORIGINAL MARKET EQUILIBRIUM PRICE
     S = ORIGINAL SUPPLY CURVE
     D'= NEW  DEMAND CURVE         Pe'= NEW MARKET EQUILIBRIUM PRICE
     S'= NEW  SUPPLY CURVE
             Figure 4.  Equilibrium price changes and price
                         elasticities of supply and demand.

-------
                                -24 -
 addition  to  the quantitative significance of these items in litter,
 aluminum  contributes to their conspicuousness and persistence by its
 high  reflectivity and corrosion resistence.

      Aluminum does not appear to cause any significant problems in
 sanitary  landfilling or incineration of solid waste.  In landfills,
 aluminum  does not degrade or contribute to gas or leachate production.
 Since aluminum is noncombustible, most of it remains in the incinera-
 tor residue, but some, particularly foil, rapidly oxidizes and goes
 up the stack as particulates.  Also, because of aluminum's relatively
 low melting temperature (1220°F), aluminum can melt and pile up on or
 under incinerator grates.

                  Aluminum Recovery from Solid Waste

      The  Current Situation.  Aluminum is among the most valuable com-
 ponent materials of municipal refuse in terms of scrap price.   Alumi-
 num scrap normally sells for 15 to 20 times the price of scrap steel,
 glass, or paper.  This high scrap price means that although by weight
 there  is  only about 1 percent as much aluminum as other scrap material
 in solid waste, the potential revenue from the aluminum (estimated to
 be about  $126 million17) is as much as one-fourth the potential value
 of scrap  steel, glass, and paper.   Nevertheless, the costs of recovery
 are such that relatively little aluminum is now diverted from the muni-
 cipal  refuse cycle.

     Most of that which is being diverted is recovered through can
 reclamation programs aimed at all-aluminum beverage cans.   These pro-
 grams were begun on an experimental basis in 1967 and became firmly
 established in 1970.   Operated by the three largest primary producers,
 in cooperation with various breweries and beer and soft drink distri-
 butors, individuals are paid 10
-------
                                -25  -
step in recovery, and two possibilities  here  are  general  "source
separation" and recovery from mixed refuse.   It is  often  suggested
that households separate their trash into various components  (news-
papers, bottles and jars, cans, etc.).   One category  could  be items
that are mainly aluminum.  A major problem with such  schemes, however,
is getting households to cooperate.19 Alternatively, aluminum and
other materials could be recovered from  mixed refuse  by comprehensive
resource recovery systems.20  Aluminum would  be recovered either  from
the raw refuse or incinerator residue using processes based on the
metal's inherent characteristics (noncombustible, inorganic,  nonmag-
netic, and of low density).

     Economic Implications of Increased  Recovery.  Separation and
processing costs are major inhibitors of aluminum recovery  from muni-
cipal refuse at the present time.  Aluminum is a  small fraction of
refuse, it is intermixed and dispersed through the refuse,  and it is
generally highly contaminated (with dirt, oil, grease, food particles,
teflon, enamel and paint coatings on containers,  steel in bi-metal
cans, and various laminations in packaging).   Also, if recovery were
through traditional secondary aluminum channels,  secondary smelter
operations could be affected in important ways that increased their
costs.  Recovery of large amounts of aluminum from refuse could signi-
ficantly alter the new/old scrap ratio.   And since much of the aluminum
in refuse is in container and packaging products  made from high-magne-
sium alloys, increased magnesium removal might be necessary, a process
made more expensive by recent air pollution standards.  Another inhibit-
ing factor is the uncertainty caused by widely fluctuating scrap  prices.
(It should be noted that the price has been constant  in the can pro-
grams, a fact that no doubt has contributed to their  success.)

     Demand aspects of increased recovery of aluminum from solid
waste should also be considered, since the effects of an increase in
supply21 depend upon the nature of demand.  A steeply-sloped demand
curve  (i.e., price-inelastic demand) would imply that a relatively
sharp drop in the price would accompany an increase  in supply.  More-
over,  in some situations,  it is possible that even if the price were
to fall to zero, the market might not be cleared and  excess  supply
would  remain.  A fairly  flat demand  curve (i.e., price-elastic demand)
would, on the other  hand,  imply that an  increase in  supply would have
relatively little effect on price.   These three  cases are  illustrated
in Figure  5.

     One determinant of  the price-elasticity of  demand is  the  rele-
vant time  period involved.   In  general,  the demand for aluminum  is
more price elastic as the  time  period increases.  This implies that
if aluminum  recovery were  to  increase substantially  in a fairly  short
period of  time,  there would be  a  consequent  sharp  drop in  price.   If,
on  the other  hand, aluminum recovery increased substantially but

-------
                                    - 26 -
                          A) PRICE-INELASTIC DEMAND
     (1) SUPPLY INCREASE
       ACCOMMODATED
PRICE
   Pe
     inriiiiiiiiii
     IIIIIIIIIHJtllll
           (2) SUPPLY INCREASE NOT
             ENTIRELY ACCOMMODATED
      PRICE
                                               IIMIIIIII
                      QUANTITY
                           QUANTITY
                     PRICE
                          B) PRICE-ELASTIC DEMAND

                                       s   s'
                       Pe

                       Pe'
                                           QUANTITY
      D = DEMAND CURVE
      S = ORIGINAL SUPPLY CURVE
      S'= NEW SUPPLY CURVE
R. = ORIGINAL MARKET EQUILIBRIUM PRICE
P. = NEW MARKET EQUILIBRIUM PRICE
         Figure  5.  Market analysis of an increase in supply.

-------
                                -27  -
rather gradually over a long period of time,  there would probably be
relatively little effect on price because of  the price-elastic  long-
run demand.

     The specific uses and markets for an increased supply of re-
claimed aluminum are difficult to identify with a high degree of cer-
tainty.  Numerous constantly changing factors affect each of a  multi-
tude of specific materials-use decisions in a highly industrialized,
technologically advanced economy.  However, such uses probably would
include the traditional markets for secondary aluminum, for which
demand prospects appear to be favorable.  In  addition, important new
markets may be found.  Following the can programs, it may be possible
to recycle container and packaging aluminum into sheet alloys and
products.  Further in the future, markets may develop in uses now
dominated by other materials, and in completely new products yet to
be discovered.

-------
                                 - 28 -

                               FOOTNOTES

     Percentages are for an "average" firm (Aluminum: Profile of an
Industry [New York: METALS WEEK, 1969], p. 151).
     2A structural oligopoly is an industry composed of relatively
few firms, with the largest three to five firms producing most of
the industry's total output.
     3See Merton J. Peck, Competition in the Aluminum Industry
(Cambridge, Mass.: Harvard University Press, 1961).
     ^Environmental Protection Agency, The Economics of Clean Air:
Annual  Report to the Congress of the United States,  1972 (Washington:
U.S. Government Printing Office).
     5The Economic Impact of Pollution Control: A Summary of Recent
Studies.  Prepared for the Council on Environmental  Quality, the De-
partment of Commerce, and the Environmental Protection Agency (Wash-
ington, D.C.: U.S. Government Printing Office, March 1972).
     6Personal Communication.  J. W. Stamper, Division of Nonferrous
Metals, Bureau of Mines, U.S. Department of the Interior, to R.  J.
Talley, Solid and Hazardous Waste Research Laboratory, NERC-Cincinnati
(U.S.  Environmental Protection Agency), December 17, 1973.
     7Battelle Memorial  Institute.  A Study to Identify Opportunities
for Increased Solid Waste Utilization. Volume II ("Aluminum").   U.S.
Environmental Protection Agency, 1972.  (National  Technical  Informa-
tion Service PB-212-730).
     Published scrap prices, although typically differing from the
prices  at which transactions actually take place, should reflect the
direction and order of magnitude of changes in transaction prices.

-------
                               -29 -
     9Siebert, D.  L.,  Impact  of  technology on the commercial secondary
aluminum industry, Bureau  of  Mines  Information Circular 8445,  U.S.
Department of Interior (Washington  D.C.:  U.S. Government Printing Office,
1970), p. 60.
    10Published prices (the qualification for published scrap  prices
applies here also).
    nSiebert, op.cit., p. 28.
    12Aluminum Statistical Review 1972.   (New York:  The Aluminum
Association, 1973).
    13The Economics of Clean  Air, op.cit. ,  p. 4-156.
    ^Personal communication, J. W. Stamper to  R.  J. Talley, op.cit.
    15A demand curve shows the relationship between  market price and
the quantity of a good that consumers would want to  buy at each  price,
holding everything else (other prices, tastes,  incomes, wealth,  etc.)
constant.  A supply curve shows the relationship between  market  price
and the quantity of a good that producers would want to supply at each
price, holding everything else  (technology, wage rates, etc.)  constant.
    16"Municipal Solid Waste .... Its Volume,  Composition and  Value",
NCRR  Bulletin, Vol. Ill, No.  2, Spring 1973.
     ispersonal communication.  J. C. Dale, Environmental Services,
 The  Aluminum Association, to R. J. Talley, Solid and Hazardous Waste
 Research Laboratory, NERC-Cincinnati (U.S. Environmental Protection
 Agency), December 10, 1973.

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                                -30  -

    19See, for example, Solid Waste Report, 1/10/72, p.5.
    20See, for example, Resource Recovery: Catalog of Processes.
Midwest Research Institute, 1973 (Springfield, Va.: National  Tech-
nical Information Service, PB-214-148).
    21An "increase in supply" means a rightward shift in the  supply
curve.  This may result from, for example, improvements  in  resource
recovery technology, or the introduction of government measures
encouraging resource recovery.

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                                  TECHNICAL REPORT DATA
                           (Please read Instructions on the reverse before completing)
 REPORT NO.
    EPA-670/5-74-005
                             2.
                                                           3. RECIPIENT'S ACCESSIOI*NO.
 TITLE AND SUBTITLE
 Aluminum as a Component of  Solid
 Waste and a Recoverable Resource
                                         5. REPORT DATE
                                          Sept.  1974;  Issuing  Date
                                         6. PERFORMING ORGANIZATION CODE
7AUTHORIS)
                                                           8. PERFORMING ORGANIZATION REPORT NO.
 Ronald J.  Talley and Richard  H.  Ongerth
"PERFORMING ORG -\NIZATION NAME AND ADDRESS
 National  Environmental Research Center
 Office of Research &  Development
 U.S.Environmental Protection  Agency
 Cincinnati. Ohio  45268	
                                         10. PROGRAM ELEMENT NO.

                                            PE-1DA312	
                                         11. CONTRACT/GRANT NO.
12. SPONSORING AGENCY NAME AND ADDRESS
  Same  as  above
                                         13. TYPE OF REPORT AND PERIOD COVERED

                                         	Final	
                                                           14. SPONSORING AGENCY CODE
15. SUPPLEMENTARY NOTES
16. ABSTRACT
      This report surveys  the production and use  of  aluminum and its occurrence
  in  solid waste; the aspects related to resource recovery are emphasized.
  Surveyed are both the  primary and secondary aluminum industries, which  produce
  aluminum from virgin materials (i.e., bauxite)  and scrap, respectively.   Supply
  and demand anaylsis is used to analyze fluctuations in scrap prices  and impli-
  cations of increased recovery of aluminum from  solid waste.
II
a.
                                KEY WORDS AND DOCUMENT ANALYSIS
DESCRIPTORS
                            b.IDENTIFIERS/OPEN ENDED TERMS
COSATI Field/Group
    Aluminum Industry*
    Metal Scrap*
    Demand (Economics)
    Supply (Economics)
    Refuse*
                              Recycling
                              Resource Recovery
                              Solid Waste
                              Mixed Municipal  Refuse
   13B
  . DISTRIBUIIUN STATEMENT
         Release  to  Public
                            19. SECURITY CLASS (ThisReport)
                               Unclassified
                                                        21. NO. OF PAGES
                                                                               39
                            20. SECURITY CLASS (Thispage)
                               Unclassified
                                                                         22. PRICE
EPA Form 2220-1 (9-73)
                          -31-

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