The scrap industry's recycling businesses are in the U.S., China and developing nations.

The Scrap Business is Underrated

May 7, 2014 • Businesses, Demand, Supply, and Markets, Developing Economies, Economic Growth, Environment, Innovation, International Trade and Finance, Labor, Macroeconomic Measurement, Regulation • 184 Views    No Comments

Our Wednesday Environment Focus

By Madeleine Vance, guest blogger and student at Kent Place School

The “scrap” business is a lot more than just scrap. Once you drop your empty soda can into the recycling bin, it could even be a piece of the car you’re driving next year.

But the transformation of your soda cans into cars has also transformed our entire world. According to the Institute of Scrap Recycling Industries, the American scrap recycling industry employed more than 138,000 people in 2012. In untraceable back alley businesses and high-tech facilities that can even process a jumbo jet’s worth of recyclable trash in one day, people are building fortunes from what we throw away. “What that warehouse contained on Monday was never what it contained on Friday. The supply of scrap and the demand for scrap, just never seemed to end,” writes journalist Adam Minter of his experience growing up in a scrapyard.

But let’s go even deeper into the business.

Around 60% of the recyclable waste generated in the US annually remains here while the other 40% is exported to save room in our own landfills.  In 2012 alone, the US scrap industry transformed 135 million metric tons of recyclable waste into raw materials that could be made into new stuff.  In 2011, American firms made 39.2 billion dollars from exported recyclable waste that is used in countries like China as an alternative to new mines or factories that would need fossil fuels. Also, this may come as a surprise, but China is the world’s top recycler. 34.1% of copper, which is used in an eclectic range of home products, is from recycled sources.  So next time you see a “Made in China” label on your iPhone charger, the copper in it may have been a piece of your neighbor’s Christmas tree lights a few years ago.

Finally…one more fact. While today, the world’s most recycled product by weight is the American automobile, between 1955 and 1970, Americans littered almost 40 million automobiles throughout the country. You may think the solution for this came from an environmentalist or university professor when in fact it came from a junkyard owner in Texas. This junkyard owner created the automobile shredder. An invention that recycles as many as 14 million American cars annually in the US, the car shredder supplies the American steel industry with roughly 15% of raw steel-making material.

So, as you throw your next soda can into the recycling bin, you will know that you are fueling a global billion-dollar industry that has transformed your life as well as the world’s economy.

Sources and Resources: Adam Minter, an American writer, has covered the global recycling industry for more than a decade. Since growing up in his father’s scrapyard and witnessing firsthand how intense the demand for scrap metal is, he has conducted groundbreaking investigations on recycling in China, been featured in many notable publications such as National Geographic and The Wall Street Journal, and is author of Junkyard Planet. His work and research shed light on the scrap metal industry and how the globalization of waste has become a permanent feature in our world’s economy.

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