Canadian Plastics

Turning Trash Into Cash: Strategies for selling unwanted regrind

By Mark Stephen, associate editor   



Today's plastics processors agree that with resin prices soaring, throwing away regrind is like throwing away money. That's why more and more are returning valuable regrind quickly to their production...

Today’s plastics processors agree that with resin prices soaring, throwing away regrind is like throwing away money. That’s why more and more are returning valuable regrind quickly to their production system.

But some applications don’t allow for regrind, meaning scrap is simply thrown out. Some processors do granulate waste, but only to reduce garbage disposal costs.

But there is a third option many processors haven’t considered: Selling their regrind.

MONEY FOR NOTHING

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“It’s alarming how many processors are throwing away clean scrap or selling for a few pennies a pound, material that costs over a dollar a pound,” Christian Weiss, Wittmann product manager, Nucon Wittmann, in Markham, Ont., said.

But an effective strategy to maximize the value of regrind doesn’t have to be out of reach. The message to processors from resin brokers and auxiliary suppliers is: Invest a little thought and effort into a strategy for selling your regrind and you will be amply rewarded.

John Sattler, president of Chicago, Ill.-based regrind broker H. Sattler Plastics Co. Inc., said, since materials account for a high percentage of the cost of a molded part, there is definitely a demand for quality regrind and therefore money to be made by selling it. “If the average plastics processor is able to sell his scrap for even $1,000 a month, instead of trashing it, he can generate bottom line revenue equivalent to the profit on $20,000 in sales, assuming a profit margin of five per cent.”

And since this profit is achieved without adding production capacity, hiring new employees and involves virtually no sales or administration costs, it’s basically money for nothing, Sattler explained.

GETTING SERIOUS ABOUT REGRIND

Resin brokers and auxiliary suppliers say the first step towards producing saleable regrind involves an attitude change.

Processors have to take the selling of regrind seriously, Jack Bowne, vice-president of sales and marketing at Hosokawa Polymer Systems, Berlin, Conn., said.

“Most are lazy and don’t pay attention to it, and try to save space [by throwing it out],” he continued. “Maximizing the sale of regrind is not treated as an important part of the materials management of their plants.”

Weiss agreed and said processors must also understand that creating quality saleable regrind is different than simple size reduction and requires a coherent management strategy.

CLEAN, SEPARATE AND TAKE INVENTORY

The next step, for processors granulating in-house, is developing the proper set-up, Weiss said.

Big-screened general-purpose granulators are fine for scrap reduction, but not necessarily for producing quality, uniform regrind from a specific part, he added.

Selecting the right granulator is crucial, according to Mike Werner, national sales manager for Pittsburgh, Pa.-based auxiliary supplier Conair. Werner stressed the importance of matching rotor and knife design, knife clearances, rotor speed and screen sizing to the type, grade and size of the parts being reground to ensure uniformity.

And the amount of scrap material to be processed also determines how many machines are needed, Weiss added.

CONTAINING CONTAMINATION

Essentially, the goal is producing regrind that is not only uniform but also clean, Hosokawa’s Bowne said, since a higher quality is what commands a higher price.

The best way to prevent contamination is by avoiding it at the press by keeping the different types and grades of resin clean and separate.

During granulation, avoid contamination by using dedicated grinders for each type of resin, Weiss said, or thoroughly clean the granulator before changing materials.

But processors shouldn’t give up if contamination occurs, Kevin Poitras, vice-president of Ajax, Ont.-based broker Post Plastics Canada Inc., said. “[When] people think plastic is too contaminated they simply throw it out,” he said. “I used to do that myself, but today there are all kinds of ways to decontaminate it.”

Conveyors equipped with magnetic systems will automatically remove ferrous materials from regrind, he said. Dust separators extract dust and fines from regrind. Separating paper from plastics can be done by submerging the regrind in a water solution and floating the components apart, Poitras noted, and composites that have been cross-contaminated with different types of plastic can be separated using the same float/sink technology.

COLOUR BY NUMBER$

Purity isn’t the only factor affecting the dollar value of regrind, however.

Properly sorting and labeling materials by type, and especially by colour, can further maximize resale value, Sattler said. Different colours command different prices, with natural-coloured and then pure black being the most valuable.

For example, Sattler Plastics showed a processor that was selling 40,000 lb. of acrylonitrile-butadiene-styrene copolymer (ABS) regrind per month at mixed-colour prices how to separate the black and white pellets. The company now nets an additional $0.12/lb., which translates into almost US$30,000 per year, Sattler said.

STRATEGIES FOR ALL SIZES

Many large regrind producers, such as the Weston, Ont.-based pharmaceutical company Apotex Group, which is prevented by regulation from using its regrind, already take the process of selling regrind very seriously, Steve Hamilton, vice-president of Hamilton Avtec Inc. in Mississauga, Ont., said.

Smaller processors don’t need to own a granulator to do the same, but ownership does have its advantages, said Greg Parent, Canadian representative for shredder manufacturer Vecoplan LLC. Having a machine in-house can make good economic sense because regrind brokers will pay more for processed material, as it saves them the cost of doing it themselves.

For companies that don’t own a granulator and would have trouble purchasing one, some brokers are willing to finance the machine for them so that there are hardly any out-of-pocket costs, Sattler said.

Other brokers, like Post Plastics, will travel right to the processor’s door to pick up the scrap. “I have straight trucks and tractors and will pick up one box of plastic or trailers of plastic,” said Poitras.

Brokers then take the material back to their own facility where it is processed, inventoried and packaged by type, grade and colour, he explained.

But however a processor decides to approach it, with resin prices forecasted to stay high for at least the next few years and more and more buyers roaming the landscape for high-quality material, this is a good time to trade, not trash, surplus regrind.

Ten Ways to Get More Cash for Your Regrind

1. Avoid cross-contamination at the press by keeping resin types and grades separate.

2. Use individual, clearly marked containers to differentiate resins from each other and from trash and other non-recyclable materials.

3. Avoid cross-contamination during grinding either by using dedicated grinders for each resin type or by cleaning between changeovers.

4. Avoid mixing filled and unfilled grades of the same generic resin type together; unfilled grades are usually more valuable.

5. Avoid storing coated, painted, decorated or materials containing inserts with pure materials.

6. Grind colours separately or at least separate natural and blacks from other colours. Natural is worth the most, while pure black is usually worth more than mixed colours.

7. Use good, serviceable packing to avoid claims for losses, repacking and freight.

8. Fill all packages completely since partly filled packages increase shipping costs.

9. Label all packages clearly to avoid confusion as to their contents.

10. When listing contents for sale, be as specific as possible since brokers will pay more when they know exactly what they’re getting.

Source: CSI Plastics, Holden, Mass.

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