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Supply and Demand in the International Marketplace Navigating the Export Issue: Economic, Environmental and Ethical Con

Supply and Demand in the International Marketplace Navigating the Export Issue: Economic, Environmental and Ethical Considerations Robin Ingenthron American Retroworks Inc. Middlebury, Vermont www.retroworks.com. National Recycling Coalition. Session Goals:. Basic Starting Points

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Supply and Demand in the International Marketplace Navigating the Export Issue: Economic, Environmental and Ethical Con

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  1. Supply and Demand in the International Marketplace Navigating the Export Issue: Economic, Environmental and Ethical Considerations Robin Ingenthron American Retroworks Inc. Middlebury, Vermont www.retroworks.com National Recycling Coalition

  2. Session Goals: • Basic Starting Points • 2) Case Studies: USA, Cameroon, Honduras, S.China, N.China, Pakistan, Egypt, Lithuania • 3) Common denominators for success & failure • 4) Recommended Standards

  3. Basics behind domestic and foreign demand for used electronics and scrap REALITY:If USA exports everything, we send 1/3 reusables, 1/3 recyclables, and 1/3 Toxics Along for the Ride. REALITY:if USA exports nothing, we destroy reuseables (and they cannot afford new); they mine to replace the recycled metals, and mining produces even more toxic harm than recycling. SOLUTION:Setting a Higher Standard. USA processing, limited exports (tested equipment, copper scrap), simple tests (like CRT Glass Test); market development to promote best practices; (funded) state processing contracts with restrictions and incentives; etc.

  4. Market Forces Low wages, better repair Manufacturing Demand, Free market mining CD, Floppy Drives Cords, cables Video cards, Monitors, ATX cases Gold Copper Aluminum Steel Plastic Leaded glass (TVs and bad monitors) Gold process waste Mercury batteries Contraband camouflage Lax environmental standards

  5. Understanding Export Forces • Reuse Forces • 1. High tolerance/demand for used • 2. “Free” software • Cheap parts • Good, cheap tech. labor • Recycling Forces • 1. Metal demand • 2. Balance of Trade • Cheap labor • Cheap env. Laws Giant Sucking Sound Growth in Chinese demand for copper (ore and scrap): 20% per year 1999-2003

  6. USA Mercury Emissions by Industry(Rank #2-#7 - w/o GOLD Mining) Source: http://www.epa.gov/region09/toxic/tri/report/01/mercury.pdf

  7. USA Mercury Emissions by Industry(Rank #1-#7) Source: http://www.epa.gov/region09/toxic/tri/report/01/mercury.pdf

  8. Chinese demand in particular drives both recycling and mining • 1. Electric and electronic appliances “made in China” • 2. Chinese “New Deal” scale infrastructure development • Asia #1 in per capita consumption of gold & platinum • (the only materials which the West does not consume most of) Mining nightmares in Borneo, Chile, Congo, Philippines, Turkey, etc.

  9. E-Scrap is 300% richer in copper and other metals than mined ore Recycling produces a fraction of the pollution from mining. Gorilla and orangutan extinction is arguably driven by electrics metal mining. One Copper mine in Papua New Guinea (feeding China) dumped 80,000 Tons Per Day of Cyanide tailings into the OK Tedi River from 1990-2000 USGS – At 1990 rate of consumption, all known copper reserves will be exhausted this century: Ocean mining will be the primary source of copper in our lifetimes. USA Model? 95% from federal lands, $5/acre, 14/15 largest Superfund sites Hard rock mining produces 45% of all toxics produced by all USA industries. Better to meet demand than not to? Gold miningreleases more mercuryinto the environment than mercury production and disposal combined!!!

  10. Export Goals, Export Policy, Export Standards Reuse : USA is at a disadvantage. Assess knowledge, experience, ability to support. Dollars per item, categorization. USA Export Restrictions on MBPS Recycling: Distinction between lead (CRT) markets (42% of scrap), which are rare. Gold scrap a problem (process waste), though demand is certainly high (as compared to lead). 2nd Container Inspection: Importer promises immediate feedback on first container, digital photos, permission to do site visit after second container. Hiding high tech goods Game playing on tariffs a big frustration. Corruption and protectionism hurts legitimate environmental practices.

  11. Cameroon • I lived there 1984-86 • Friend/employee/partner is native • Connection to Rebecca Enonchong, CEO Application • Technologies Inc., World Bank Digital Divide Forum Chair • - Flew Yadji there for 4 months under contract • Sewing machines • mixed clothing, shoes • dual voltage, P2 3 visits 10 container Purchase Order No money

  12. Honduras • Former partner lives there 3 months/ year • Partnership with Vermont Rotary Club • 6 Public Schools • - USA 120 voltage, P1-P2 3 years 3 containers Great follow up No money

  13. Southern China: Scrap • High Demand, fast payment • Invitation to speak, tour with Sino EPA • Combined scrap (copper, gold, aluminum) but not with repair • Visit to 2 aluminum, 2 copper, 200+ reuse operations 6 months 3 containers No problems Casualty in war on “counterfeit”

  14. Southern China: Reuse • High Demand, fast payment • SKD TV repair demand is booming • Tour 200+ small resellers • SKD TV Manufacturing – • 1 operation = 50,000 per month 6 months 3 containers No problems Casualty in war on “counterfeit”

  15. Northern China: Scrap • Officially sanctoined • $16M in matching Beijing bank loans • Tour – not on schedule • No visible equity Did not proceed, no trial shipments

  16. Lithuania • Officially sanctoined • EU, NATO member • Establishex • Tour – not on schedule • No visible equity 2 trial shipments, TW, AL, scrap printersThey want negative value material, but Don’t show how they will handle it

  17. Other Visits (Fly and Buy) • Pakistan: All the right answers. Failed surprise site visit. • Egypt: Working units only, Pentium II and above • Columbia/Bolivia/Peru: Black 27” TVs (repairable) • Belgium, England, Spain: gold bearing scrap • Ghana: Promising but importer was neophyte • South Africa: Screenvision – no reply, non-profits • Malaysia: Impressive 30 page environmental dossier, lies about CRT • Nigeria: corrupt mess 2 trial shipments to Egypt2 trial shipments (TVs) to Peru, Bolivia Ghana no-show

  18. Overall USA Monitor Management$ spent and earned per 1000 monitors Most demand for used is overseas

  19. Possible USA Monitor Management$ spent and earned per 1000 monitors If copper and lead returned to 1900 prices, and monitors were repaired at 75% rate Countries with high reuse and no mining subsidies have the advantage

  20. Overseas Monitor Management$ spent and earned per 1000 monitors No mining subsidies, and 10% technical and handling labor cost Countries with high reuse, no mining subsidies, and low wages are the winners

  21. Chapter 3: Know your supply • Keep 1/3 domestic • Evaluate exports • Keep records • Evolving standards

  22. 1) Pristine takeouts for auction, clean scrap - you can deal with anyone directly 2) Toxic Junk, Contraband, leftovers - you should insist on domestic processing 3) “I dunno”…Mix of good, bad and ugly - you should deal with USA company with capacity to separate, process and market, and get documentation Understanding your own supply

  23. Understanding your own supply 1) Pristine takeouts, off-lease equipment (Reuse material) Highly Sorted Working and repairable monitors, P2s+, cords, peripherals, cartridges positive revenue dollars per item (not pennies per pound) high overseas demand, with incentives to hide it from tariff collectors and anti-gray-market enforcers • Working monitors • No screen damage • No VGA • No Apple • Make, Model, COM, • Year, other tech details

  24. Understanding your own supply 2) The Dregs: • Cherry-picked material, TVs, obsolete equipment, residue, shredded or baled material. • Damaged CRTs • Pennies per pound • Overseas demand based on copper, gold and aluminum content One USA company sold good stuff to one export market, and (misrepresented) bad stuff to another

  25. Understanding your own supply • “I don’t know”: Then make sure the company you select has capacity to handle either type of E-Scrap. Working monitors “Crapple” “We’re switching to flat screens” One fellow insisted his 1990 public school Stuff “works as good as when it was new”. Another commercial client insisted that working monitors, replaced by flat screens, should be recycled/destroyed here in the USA.

  26. 4 Simple Due Diligence Tests • Glass recycling records • Gold bearing scrap records • Sample manifests (declared reuse items) • Employees or capital investment per ton

  27. 1. CRT Glass Test - no known market in Asia for screen burned, scratched or busted tubes. Legitimate USA recyclers must be able to show where the non-repairable glass goes. Guidance document at retroworks.com, several other sites

  28. 2. Printed Circuit Board (PCB) Gold Test - Nasty recycling (and nastier mining) practices. We do all Printed Circuit Boards domestically. Q: Will this lead to more mining? A: Gold mining is maxed out already BAN: chinese circuit board / gold recycler Reuters: chinese miner

  29. 3. Truth in Exporting Test - Ask for shipping manifests (sensitive market info can be blocked out). Legitimate bill of lading shows make/model/voltage/COO/condition. DHS will enforce existing high tech export rules, customs declarations. How picky ? “Picky is good” If “for repair”, is it wrapped, tested, sorted and manifested? One export market included a carton of cigs in every sample photo of e-scrap they are soliciting at high prices. Hmmmm.

  30. 4. Employment / Capacity Test • How many tons did the company handle last year? • How many employees per ton? • If fewer employees, how much automated processing equipment is in place? One NE company has 2 employees and ships 1000 containerloads per year This container certainly has several hundred cords, power supplies, and hard drives which could be reused - but it’s TAR, an abuse of reuse.

  31. Is there a limited number of environmental dollars? Is the Perfect the “enemy of the Good?” Does Environmental good justify tariff avoidance? 4 Ethical Questions

  32. mineralpolicy.org mpi.org.au USGS.gov moles.org ban.org copper.org www.antigraymarket.org these and other links www.retroworks.com

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