This document discusses recycled aluminum markets and recycling rates. It provides background on assumptions around recycling costs versus virgin materials costs. It notes that recycling only occurs when the price of recycling exceeds the marginal cost of landfilling. Statistics show the percentage of aluminum supply coming from recycling was 20.29% in 2009 and fell slightly to 19.9% in 2010. If government recycling requirements and subsidies were removed, profit-seeking firms would dictate recycling rates based on costs, and recycling investment may fall if primary material prices dropped.
2. Recyclable, Nonrenewable Resources
โข Examples: paper, plastic, metals
โข Recycled vs. virgin commodity market
Assumptions:
โ Landfilling material costs< recycling costs
โ Marginal cost recycled> marginal cost virgin***
โ Identical commodities
โ Recycling only happens when price of recycling is
above the marginal cost of recycling over land
filling
3. CRV
โข California Redemption Value
Beverage Container Recycling Program 1987
Curbside Pickup
Certified Recycling Centers
5. Life of Aluminum
โข Due to increase in domestic labor costs many of the industries aluminum
die casting jobs have seen trends of outsourcing.
โข Die casting for the auto mobile industry is second biggest use of recovered
aluminum.
6. This graphically represents percentage of aluminum supply from 1970-1989.
In 2009 3.4 Million tons of aluminum were created , .69 million tons were recovered.
=.69/ 3.4=20.29%
In 2010 this rate has fallen to 19.9%
7.
8. Free market system
โข If the government didnโt have minimum
recycling requirements imposed:
โข Profit seeking firms would dictate ideal
recycling rate based on MC=MR
โข If price of primary materials were to fall, firms
would be hesitant to invest in recovery of
materials.
โข Subsidies will help raise recycling rate based
on implementation
