Full circle: Omni Source Corp. bridges a closed-loop recycling program between a Ford Plant and an Alcan mill - Cover Story

Recycling Today, Feb, 2003 by Lincoln Brunner

Prompt industrial scrap is handled in many different ways, but seldom is it sent on a 1,000-mile closed-loop journey from the place it is generated back to where the original metal came from, remelted, re-rolled and shipped back as useable aluminum sheet.

But that isn't stopping Ford Motor Co., Dearborn, Mich., and the Alcan Automotive division of Alcan Aluminum Corp., Cleveland, from trying.

With a $400,000 separation system designed by OmniSource Corp., Fort Wayne, Ind., Ford's Chicago Stamping Plant segregates the stream of aluminum and ferrous scrap running underneath its thundering stamping lines and ships the aluminum in bulk to OmniSource's East Chicago, Ind., plant. There it is pressed into 1,000-pound bales and sent directly back to its source--Alcan's Oswego, N.Y., aluminum sheet mill.

The idea is to slash Ford's raw material costs for the AA6111 aluminum it uses to stamp hoods, while brightening aluminum's overall profile among automotive designers looking for economical ways to meet ever-tightening fuel efficiency and strength-to-weight requirements in their vehicles. And while buyback programs between large sheet metal users and suppliers are nothing new, Ford and Alcan believe their latest twist is unique, at least to the domestic market.

"This is the first production application in North America where [aluminum scrap] actually is being reclaimed in its original state," Mcan Vice President Tom Gannon says of the program, which officially kicked off in late summer 2002. "It is indeed a closed-loop system.

"It's actually better than we anticipated in the sense that we did all the work up-front," he adds. "We were very careful in not rushing into this. We wanted to make sure the scrap met the purity levels as far as iron and moisture content."

DISSECTING THE PROCESS

Indeed, the key to making the plan work for both parties is purity--getting AA6111 and only AA6111 back to Alcan's Oswego mill efficiently.

As aluminum scrap is cut from blanks in the stamping dies, it drops onto the plant's scrap conveyor system. The conveyor system carries both ferrous and nonferrous material, so Omnisource developed a series of three magnets and a shaker table that culls the ferrous material from the aluminum. What remains is AA6111 pure enough to be melted and processed straight back into blanks, which are manufactured into hoods for vehicles such as the Lincoln Town Car and F-150 and Ranger pickup trucks.

The new system is a significant improvement over the old separation process, according to Rick Rifkin, vice president of the nonferrous operating group at OmniSource.

"The material coming out of the stamping facility was contaminated with steel; we and Ford did a fair amount of good separation, but it was not what we would call mill quality," says Rifkin, whose company was serving as a scrap processor for the Ford plant and as a supplier to Alcan before the new system was put in place. "As a result, a lot of it was going into secondary smelters [that were] making die-casting alloys. It wasn't clean enough for Alcan to use to make that grade."

This pointed to a major concern harbored by at least one experienced scrap processor--plants trying to perform the "Closed-Loop Waltz" without the means to segregate material properly.

"The danger I see is that other manufacturing plants that do not have the capability to separate their material or prepare material correctly will get the idea that this is something they can do," says Phil Zeid, president of Universal Scrap Metals in Chicago. "We've seen it before, and it's a very difficult thing. Normally we encourage them to try to do it, but there's time, effort and cost involved in preparing it correctly."

GREEN DAY

Because remelting is widely considered to us only 5 percent of the energy needed to create primary aluminum from ore, the program makes simple economic sense for both parties--Ford gets a far better return on its recycled scrap, and Alcan saves energy costs and can boast of its use of recycled materials.

"I think it really started with our long-term efforts to reduce the overall cost of aluminum, making it more attractive to the car companies," Gannon says. "When you look at the value stream, if you can get this material and get it back to the facility where it started from, you have the best opportunity of extracting the maximum amount of value from the material itself."

Using somewhat inexact figures, Andy Acho, world-wide director of environmental outreach and strategy for Ford Motor Co., explains that Ford may get 50 cents back for every dollar it spends on raw material when different kinds of scrap are swept up together. In a closed loop system, that payback shoots up to around 85 cents on the dollar when the user, Ford, becomes a supplier of premium quality scrap to its supplier, Alcan.

Gannon explains Ford's advantage another way: Say Ford spends 65 cents on a pound of primary aluminum and can get one pound of aluminum sheet back for every pound it sends back to Alcan. Given that recycling costs 95 percent less than producing primary aluminum, and that the plant can recover about 50 percent of every blank it stamps, Ford can cut the cost for half of its material volume down to perhaps 15 cents a pound. That, in turn, slashes Ford's overall material cost to about 40 cents a pound at the end of the day.