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October 2006


Auto recycling industry reaches $25 billion a year

Electronic Recyclers in Fresno, California is turning tons of electronic waste into marketable commodities. “There is a tremendous value in the commodities that come out of these products,” said John Shegerian, Electronic Recyclers chief executive officer.

Electronic Recyclers, which opened in 2002, is basically a demanufacturer of electronics, Shegerian said. “We take it. We dismantle it. It leaves as one of three commodities; plastic, glass or metals,” Shegerian said. “We bale the plastics. We bale the metal and we seal the crushed glass. We sell all three products around the world.”

Electronic Recyclers received about 5 million pounds of e-waste in August, Shegerian said. The volume of e-waste is growing about 5 to 15 percent a month.

Plans are now in the works to open recycling facilities in four different states due to growth. “We’re going to be taking this national in the fourth quarter of this year,” Shegerian said. “Next year we plan to open at least a dozen more facilities.”

A sea of cell phonesShegerian said that legislation in California to establish a funding system for the collection and recycling of certain types of electronics has helped the recycling business. “Not only do we keep the stuff out of landfills, but this brand new industry has created thousands of jobs here in California. This is an industry in its infancy,” Shegerian said.  

Hari Ramamoorthy, a research analyst at the consulting firm Frost & Sullivan in Palo Alto, California, expects the demand for large scale recycling companies to firm up in the United States. “The recycling industry currently is fragmented with the presence of lots of small recycling firms,” Ramamoorthy said. “With many states likely to impose legislation for electronics recycling there is need for more recycling infrastructure.”

There are currently no federal regulations regarding e-waste. In addition to regulation in California, Massachusetts has banned incineration and disposal of cathode ray tubes (CRTs).

Maine has regulations that require manufactures of TVs and computer monitors to collect and recycle products that are sold within the state.

Maryland also charges a fee from companies that manufacture more than 1,000 computers per year.

“Even though there is no federal directive with regard to e-waste, awareness about e-waste is widespread in the United States and Canada,” Ramamoorthy said. “There are a huge number of small and big electronic waste recyclers. Currently, most of the recyclers deal with CRTs and computer housings, cell phones, and similar electronic materials.”

Ramamoorthy said it is estimated that United States computer recycling alone could become a $1.5 billion industry annually. Only about 10 percent of computers are currently recycled. In total, about 20 to 50 million tons of e-waste is produced every year on a global basis. Ramamoorthy noted that the average life span of a computer dropped to 2 years in 2005. Mobile phones also have a two-year lifecycle.

“Electronics recycling should not be seen as a burden. It not only protects the environment, but also makes business sense. It will enable use of valuable metals and high value plastics that will otherwise end up in the landfill,” Ramamoorthy said.

ReCellular Inc. based in Dexter, Michigan is just one of many companies profiting from e-waste. ReCellular has a network of mobile phone collection programs across the country designed to extract obsolete phones from the marketplace.

Mike Newman, vice president of ReCellular, said that the company currently collects approximately 300,000 used mobile phones each month. “Phones that still have economic value are refurbished and sold back into the marketplace,” Newman said. “Obsolete models are properly recycled to reclaim the metals in the phones.”

Newman said business at ReCellular is growing rapidly. “We are on track to increase the quantity of phones we collect by 67 percent this year alone,” Newman said.

There is plenty of room for further growth, Newman said. “Though we are already the largest cell phone collector and recycler in the country, there are a tremendous number of phones that are currently uncollected, allowing for significant growth.”

Newman said state-level regulations concerning mobile phones have boosted business at ReCellular. “Generally, new laws and regulations have helped to increase awareness at the consumer level about the opportunities available for phone recycling. This has helped to spur additional participation in existing programs,” Newman said.

More needs to be done, however, to recycle mobile phones, said Kimberlee Dinn, director of operations and development at EARTHWORKS, a non-profit with a focus on the environmental impacts of mining and mineral development based in Washington D.C.

“The actual rates of cell phone recycling are not going up as quickly as I would like to see. I think a big factor of that are retailers and manufacturers just haven’t made this a top priority,” Dinn said. She said none of the industry’s voluntary programs are recycling more than one to two percent of all the mobile phones sold a year.

Electronics Recyclers

“What we’re saying is if you don’t want to be forced to operate under different standards in every state, then you’re going to have to come up with a system across the board that really addresses the issues that doesn’t just put a Band-Aid on it,” Dinn said.

EARTHWORKS estimates that from the 130 million mobile phones discarded each year the internal metal components translate into 65,000 tons of waste containing lead, cadmium, arsenic, beryllium, mercury and other toxic heavy metals.

If all discarded cell phones were recycled each year, EARTHWORKS estimates $150 million worth of metals would be recovered, including 182,000 ounces of gold worth $100.5 million, 1.9 million ounces of silver worth $18.6 million, 65,000 ounces of palladium worth $18.5 million, and 5 million pounds of copper worth $10.9 million.

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