4 Reasons Why Electronic Recycling Costs are Skyrocketing
- The high plastic content found in over 50% of electronics recycled
- The abrupt China, Vietnam, and Thailand ban of scrap plastic imports
- The largest local de-manufacturer ECS Refining going bankrupt in July, 2018
- The 25% tariff war imposed by the Trump Administration.
Let’s take a look at each one in more detail.
Why the Cost of Electronic Recycling Has Gone Up
The high plastic content of over 50% of electronics recycled
Computers and electronics are made up of precious metals and plastics. The top 6 materials are iron, aluminum, copper, lead, nickel, tin, and plastics. Plastics are the most difficult to recycle due to the cost of labor and their low reclaim value.
The typical desktop weighs about 23 lbs. It’s only 1.96% plastic. Because of its high content in iron (61.55%), aluminum (6.40%), and copper (3.41%), it’s cost neutral to recycle. Yet many of global economic factors have caused precious metal prices to fall.
Meanwhile, the plastic content of LCDs, CRTs, mouse and keyboards, printers, copiers, and coffee pots can be as high as 60-70% of their total weight, making them very expensive to recycle.
China’s ban of plastic scrap import, followed by Vietnam and Thailand
In January 2018, following China’s ban on import plastic scrap, Vietnam, and Thailand also stopped importing plastic scrap for recycling. In the past, reclaimed materials were shipped there, and then the materials were made into some other type of product, called de-manufacturing. Because China has such a low cost of labor, most electronic products are made there.
With the ban, semi-processed reclaimed materials have fewer places to go. To responsibly recycle materials with a high content of plastic, Green Citizen needs to pay higher prices to use the best de-manufacturing facilities in the U.S.
ECS Refining filed bankruptcy on July 2, 2018
On top of the challenges mentioned, one of the largest de-manufacturers in the nation, ECS Refining went bankrupt on July 2, 2018. Over the last 13 years, ECS Refining has been one of the most reliable e-scrap vendors. ECS processed over 20 million pounds of electronics a month. By taking 20 million pounds of de-manufacturing capacity off the market, it has limited the space available in the Western United States to properly de-manufacture all electronics. This has created a bidding war between collectors for the limited space, driving up the cost of electronic recycling.
Trump Administration’s Tariff War with China
First, the Trump administration raised tariffs by 25% on many goods imported from China. China then retaliated with import taxes on goods from the U.S. While much of recycled plastics have been banned, importing precious metals to China are also affected because of the tariff war. It drives up the cost of exporting and increases recycling costs.
The Green Citizen Solution
Unfortunately, these factors have created a new reality -consumers and businesses are going to have to pay substantially more for electronic recycling.
In fact, the price will increase until it’s cost competitive to make products out of recycling materials locally, creating a local circular economy. That’s why Green Citizen is at the forefront of developing a strategy for this circular economy right here in the San Francisco Bay Area.
We have come up with a plan to counter the new costs of electronic recycling.While costs have risen by 100%, we are only increasing our recycling fee by 50% on September 1, 2018. To cover the remaining 50% of added recycling costs, we are increasing our company’s operational productivity, thus increasing revenue from our reuse items sold on eBay, Amazon and our e-commerce stores. For now, we must all share in the increased costs of electronic recycling.
For more information about the rise of electronic recycling costs, give us a call at (650) 493-8700 or message us on our live chat. We also offer business pickup and consumer drop off electronic recycling in the San Francisco Bay area.
James Kao is the founder/CEO of GreenCitizen. GreenCitizen’s mission is to provide products and services that make everyday Earth Day for the community. read more »