Tuesday, September 25, 2012

Recycling Aluminum Cans

Approximate 93 billion aluminum beverage cans are made in America every year.  Alcoa and Atlanta-based Novelis, a unit of India's Hindalco Industries Ltd., had been jointly collecting and recycling cans since 2009, when they created a joint venture to centralize collection. Last year, it collected 40 billion cans.

But the two aluminum makers have parted ways and are bent on trying to outcollect each other.
Novelis withdrew from the venture Aug. 31—leaving it entirely to Alcoa—and is setting up a new organization with a goal of collecting 60 billion cans a year by 2015.

Used beverage cans usually trade at around 20% less—currently at about 81.5 cents a pound versus $1.04 a pound—than the value of primary aluminum. The costs of cleaning and processing make cans only marginally cheaper.

Novelis says it believes using more cans will allow it to increase sales in places where lower carbon footprints have a marketing value, and to set itself up to minimize carbon taxes if they are implemented.

Making cans from recycled aluminum uses 95% less energy than manufacturing them from raw materials, such as bauxite, says the Aluminum Association, a Washington-based industry group.


Alcoa, which has been recycling aluminum since it was founded in 1888 when aluminum tea pots were melted down, says it is far ahead. It says it will be able to increase can collection rates with new technologies such as reverse vending machines that offer cash or credit for used cans, and more recycling bins to directly collect cans at places like large apartment buildings.

Aluminum is one of the easiest metals to recycle. In 60 days, a can of beer can be sold, trashed, collected, melted, turned into sheet, cast into a new can, and filled again with fermented barley. Cans make up 2% of the volume of recycled trash, but 40% of the value, according to the industry.

It takes about 25 cans to make a pound, which can trade at 55 cents per pound. By comparison, recovered paper is currently trading for between five and 20 cents a pound, and the plastic used in beverage containers for between 15 and 30 cents a pound, according to the Institute of Scrap Recycling Industries. (WSJ, 9/25/2012)

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