Shredding Equipment Focus--Ready to Shred?

WHETHER TO SHRED. Shredding, one avenue that many recyclers take, can be a familiar approach to long-time recyclers. However, some question at what level shredding of electronics should take place.

Mike Magliaro, executive vice president of LifeCycle Partners, Merrimack, N.H., says that prior to shredding, a company may remove as much plastic, copper, aluminum and ferrous as possible for refining or recycling.

Mark Matza, vice president of Fortune Plastic & Metal, Jersey City, N.J., says that a significant amount of collected electronics either can be completely refurbished and resold or stripped of valuable components that can also be resold. While this approach is potentially more time consuming for electronics recyclers, it often is a more enticing option for generators, as it provides a source of revenue that can offset the costs associated with shredding.

As a number of electronics recyclers note, labor costs can be significant when disassembling equipment, so knowing the type of equipment that is coming through the doors could help determine a recycler’s approach.

Amanda Hale, with United Recycling Industries (URI), a large electronics recycling firm in the Chicago area, says the company is seeing exponential growth in the amount of obsolete electronics.

URI handles between 35-40 million pounds of electronic scrap per year. After ascertaining the status of the equipment, workers at the plant either refurbish whole units or strip out components that can be resold.

While URI looks for devices with resale value among the equipment it receives, the company also operates shredders. URI has two shredding lines: one for general electronics, which runs about 40 hours per week, and one for monitors.

Mick Schum, president of WeRecycle, Meriden, Conn., agrees that electronics are a growing component of the recycling stream. The company, which has been in business for nearly three-and-a-half years, has seen the volume of incoming electronics grow in the last two years. The company does not offer shredding on site, though it works with a number of companies that provide the service. WeRecycle dismantles and markets components from much of the electronics it receives. Depending on where the material comes from, the reuse opportunities vary.

"From the private sector, between 20 [percent] to 40 percent of the material can be refurbished," Shum notes. From municipalities, however, the figure drops significantly to well below 10 percent.

While WeRecycle does not shred material on site, Shum says that the company dismantles the systems so that many of the individual components, such as copper yolks, plastic casings and the glass, are segregated, improving the marketability of the shredded material.

Although WeRecycle currently sends material that can’t be disassembled further to an outside vendor for shredding, Shum says the company is in the process of obtaining permits from the state of Connecticut that would allow it to shred in house.

Chip Slack with Intechra, an asset recovery firm based in Carrollton, Texas, also sees significant value in equipment from the private sector. His company is able to extract value out of roughly half of the equipment it receives from the private sector.

Slack says a growing number of electronic assets are ending up in developing countries. Part of the reason, he says, is that there is not enough shredder capacity in the United States to handle the material. Additionally, Slack says, "There will be a shortage of high quality IT disposal organizations that provide legitimate addition to the customers." This means ensuring that the equipment is handled properly and that information is securely destroyed.

SHREDDER SHORTFALL? MaSer Corp., baseed in Marblehead, Mass., handles demanufactured and shredded electronic scrap from throughout North America. Lauren Roman, the company’s executive vice president, notes that MaSeR’s process allows it to delaminate material, liberating the various raw materials.

Roman also says that few electronics recyclers have shredder capacity presently.

One possibility is that market-oriented reasons account for North America’s lack of shredder capacity.

First, the demanufacturing of electronic equipment it is a time consuming and expensive process. Adding a shredder to an existing demanufacturing operation would require a significant capital expense. Many facilities may also have space constraints. Additionally, after the electronics have been demanufactured and the remaining material shredding, what results is often of so little value that a smelter or refiner will charge to accept it.

Another issue is ensuring enough volume of incoming electronics to make purchasing and running a shredder economical. Roman speculates that a company would need to handle around 5 million pounds of electronic scrap per year to cost justify the capital outlay.

Yet another issue is the amount of whole electronics that are exported to developing nations. Competition among electronics recyclers remains tight, and with more material being shipped offshore, it is a challenge to compete with the relatively cheap manual labor in developing countries.

While the issue of whether to install additional shredding capacity is fraught with uncertainty, the biggest issue affecting electronics recyclers is the amount of material shipped offshore.

Matza says that if the United States eliminated the export of unshredded electronics, the country would have a shredder capacity shortfall.

EXPORT INFLUENCE. Despite the potential drawbacks associated with adding shredder capacity, recyclers are interested in installing them, especially as pressure from government agencies to restrict electronic exports grows. However, not all electronics recyclers are encouraged by the prospect.