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CMC recovery system seen raising margins

Oct 24, 2013 | 05:17 PM |

Tags  scrap, CMC, Commercial Metals Co, Joseph Alvarado, Steinert US, Metso Texas Shredder, Sean Davidson

NEW YORK — Commercial Metals Co. (CMC) is studying new investments in downstream scrap processing at several locations based on the results of technology deployed in August at a shredder in Seguin, Texas.

Walton, Ky.-based equipment manufacturer Steinert US LLC announced last week that it had completed the installation of a plant at CMC’s Seguin facility that combines multimetering, stage sizing, magnetic, eddy current, sensor and shape technology to create a total material recovery facility.

The facility also is outfitted with diagnostic, control and communication technologies to enable control of recovery and system efficiency by plant supervisors, as well as support teams at Steinert and shredder manufacturer Metso Texas Shredder Inc., San Antonio.

CMC chairman, president and chief executive officer Joseph Alvarado told analysts during an earnings conference call Oct. 23 that the enhanced material recovery investment has begun delivering results.

"In August, we commissioned a nonferrous downstream processing system at our Seguin shredder that will allow us to increase recoverable metallics. The project is still in the start-up phase but is showing early promise, and in some cases exceeding expectations," he said. "We believe this technology can be employed in other markets in which we operate."

Asked if the project investment will impact volumes or profits in the coming months, Alvarado said he expects the process to lower costs. The process helps recover as much ferrous and nonferrous scrap as possible and offers a significant cost reduction for CMC "with a quick payback for the investment," he said. "It also reduces what goes to the landfill that previously had value that we were burying and now will recover."

Alvarado said it is a "worthwhile" initiative, indicating that the value it offers is why CMC is looking at further downstream recovery systems at other shredders and facilities in large scrap concentration areas.

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