Why Are Recycled Aluminum Cans So Valuable?

Why Are Recycled Aluminum Cans So Valuable?

 

Though the fine print on the back puts its worth at 5¢ (or 10¢ in Oregon and Michigan), an aluminum can is the most valuable item you throw in your recycling bin.

Going back 150 years ago, aluminum was considered more precious than gold—but even today, it hasn’t lost its luster.

Despite being the most abundant metal on the planet (aluminum ore makes up 8% of the Earth’s crust), demand has never ceased. Airplanes, cars, construction materials, or beverage containers—the market for aluminum is strong, especially the recycled variety.

Now, as the COVID-19 pandemic-related shortages hamper the industry, the simple act of recycling our soda, beer, seltzer, and soup cans becomes paramount.

The good news is that it’s relatively easy.


Manufacturers Need Recycled Aluminum

First understanding why the overabundant ferrous metal is a hot commodity will provide context for recycling’s necessity.

Unlike gold, silver, or copper, aluminum isn’t found in nature as a pure metal. Because it easily bonds with other elements, like bauxite ore, chemical extraction is required to obtain a compound called alumina. In order to reach the pure form, the alumina must undergo something called the Hall–Héroult process—an irreplaceable technique that uses MASSIVE amounts of electricity.

According to The Aluminum Association, aluminum production consumes approximately 5% of all electricity generated in the United States. In fact, producing one metric ton of aluminum requires roughly the same amount of electricity as is used by an average US home in a year.

That’s what makes an aluminum can, crafted with pure aluminum metal, so in-demand. Creating new aluminum products from recycled aluminum saves more than 90%—and even as high as 95%—of the energy it would take to produce new metal.

With the material capable of being remanufactured indefinitely without degrading in quality, things like UBC (used beverage containers), spools of wire, and casings for many popular electronics are as good as gold to the right buyer.

Pandemic-related Can Shortages to Continue

The closed-loop process—where the material from a recycled aluminum can returns to the shelf as a new can—hit a snag with the COVID-19 pandemic. As consumers were forced home and away from bars and restaurants, the market for UBC went into overdrive to satisfy convenience and curbside pickup.

For Ball Corporation, the world’s largest producer of metal beverage containers, North American volumes were up 11% and 6% for 2020 as a whole and the final quarter of 2020, respectively. Sensing the squeeze, the AB InBevs and Coca-Colas of the industry snapped up much of the available supply, leaving the smaller businesses to buy new aluminum cans however possible and often at markup.

As of late June 2020, prices paid for UBCs by can sheet metal (returned to their pre-production form) rose to 65% of the value of primary aluminum, far and above a more typical 58% average. 

And prices may stay there. Ball Corp. president Daniel Fisher said he foresees “demand continuing to outstrip supply well into 2023.”

With prices high and supply low, recycling our invaluable aluminum cans becomes even more important. Fortunately, as we mentioned earlier, aluminum recycling is relatively simple.

Recycling Aluminum is Easy

The average aluminum can is made with 73% recycled content, underscoring why our recycling efforts play into the economics of it all. That also helps us understand how nearly 75% of all aluminum ever produced is still in use today.

Put plainly, recycling aluminum UBCs should be easy. Unlike paper or cardboard, they’re less susceptible to contamination. Unlike plastic, there are no numbers to learn or false hopes that lead you to wishcycle. Aluminum cans are pure aluminum, and they belong in your recycling bin.

For the most part, businesses and individuals in the U.S. are eager to participate—but there is significant room for improvement.

The latest report from the EPA (detailing 2018) asserts that 34.9% of aluminum was recycled. However, this doesn’t tell the full story. Of total generation, 1.9 million tons of it were containers and packaging, while two million tons consisted of durable and nondurable goods—things like appliances, car parts, and the miscellaneous goods we throw away.

A plastic bottle, glass bottle, apple, aluminum can, and cardboard box representing U.S. national recycling rates.

UBC has its own tracking. The aluminum industry (producers/businesses) recycled 42.7 billion cans at a recycling rate of 55.9% (a decline from 63.6% in 2018). Meanwhile, consumers recycled 46.1% in 2019, 3% lower than the year prior.

While the pandemic may have changed what’s “predictable,” the facts are clear: Recycling more saves everyone money when it comes to aluminum. And partnering to help businesses recycle more (which, in turn, can save considerable dollars) is our business. While the average business sees recycling rates simmer around 10%, RoadRunner often boosts rates to well over 50%.

Through our FleetHaul service, a nimble, third-party network of haulers, we’re able to ensure your commingled bottles and aluminum cans retain their value by delivering them directly to the recycling facility or buyer (and we just might have a solution for your scrap, too.) 

All this being said, even with the shortage, aluminum ingots won’t be rivaling gold bars anytime soon. But if you want to learn how to start closing the loop on aluminum cans—or at least doing your part to keep American aluminum rolling—reach out to us!

 

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