Recyclable Material Wholesalers Industry Overview

Excerpt from Recyclable Material Wholesalers Report

The industry includes companies engaged in wholesale distribution of automotive scrap, industrial scrap, and other recyclable materials, along with auto wreckers primarily engaged in dismantling motor vehicles for the purpose of wholesaling scrap. Major scrap metal wholesalers include US-based America Chung Nam and The David J Joseph Company; Sims Metal Management (headquartered in Australia); TSR Recycling and ELG Haniel (Germany); and European Metal Recycling (UK).

Competitive Landscape

Demand from the steel, auto, and construction industries drives the scrap metal wholesaling industry. The profitability of individual companies depends on cultivating relationships with suppliers and buyers. Most companies are small and compete by specializing in one type of material in their local market. Large companies have economies of scale in purchasing equipment and transportation. The industry is fragmented: the top 50 companies account for about 45 percent of revenue.

Products, Operations & Technology

Major sources of revenue are ferrous metal scrap (iron and steel), which accounts for about 45 percent of sales, and nonferrous metal scrap (mainly aluminum, copper, copper alloys, lead, and zinc), which accounts for about 35 percent. Other sources of revenue include recyclable paper, plastics, and textiles. The industry processes about 130 million tons of material annually, including 75 million tons of ferrous metals; 50 million tons of paper; 8 million tons of nonferrous metals; 3.5 million tons of electronics; 1 million tons of plastics (PET and HDPE bottles); and 100 million tires. Almost all old cars are recycled, along with 90 percent of appliances, 70 percent of newspaper, and 30 percent of glass containers, according to the Institute of Scrap Recycling Industries.