NEW YORK Southern
California is set to export its first bulk shipment of iron
ore, with one of the states largest ferrous and
nonferrous scrap processors and exporters, SA Recycling LLC,
entering the trade.
The company has started loading
a vessel with 50,000 tonnes of iron ore sourced from
It will be the Orange,
Calif.-based recyclers first venture outside the scrap
metal industry, which has faced serious challenges over the
past year, chief executive officer George Adams Jr. said.
"We dont have the scrap
business like we used to have down here," Adams told
AMM. "Ive been working hard to find other
commodities that we can handle. I looked at a lot of
commodities: wood chips, coal ... I looked at every type of
bulk commodity that went through this port that we could make
money off, but none of them really fit with our business. Iron
SA Recyclings large
operation for exporting ferrous scrap to steelmakers in East
Asia could easily be adapted to accommodate iron ore, Adams
said. "The same customers that are buying scrap are buying iron
ore. They are buying a lot of it. So theres lots of
opportunity there to do it. For me to handle iron ore, all I
had to do was put in a rail-car unloader."
The material will be sourced
from mines in California and Utah, and the company also is in
talks with a mine in Nevada. "Theres a lot of iron ore in
the Southwest," Adams said. "There are about four or five
mines, and were the closest port. So were getting
iron ore from these mines. Were beneficiating some,
buying some and handling some. Iron ore is a very natural fit
The Southwest was home to
several iron ore mines which fed large integrated mills in the
region in the past. The closure of those mills over the years
forced the mines to shut down. However, Chinas appetite
for iron ore has pushed up prices, once again making mining in
the Southwest viable, according to Adams.
"You used to have all these
integrated mills, and they were building here and living off
the iron ore in the region. And these mines are still there,"
he said. "The mills have been closed for all these years, but
when the price of iron ore went over $100, all these mines
became viable. So theyre starting to produce iron ore
again, and there really wasnt a good facility to handle
it. So we stepped in."
SA Recycling ships about 2.5
million tonnes of scrap each year and ultimately hopes to reach
the same volume with iron ore, Adams said. "Theres no
reason I cant do the same with iron ore. The Southwest
mines can produce that much. They used to do more than that."
The company expects to ship 1 million tonnes of iron ore this
In addition, the new venture
will give SA Recycling the ability to load mixed cargoes
carrying iron ore and scrap, should customers require it.
The seemingly natural fit could
attract other West Coast ferrous scrap sellers to the trade,
but Adams said that the barriers to entry are significant. "I
welcome any competition, but its harder than it seems,"
he said. "I have two docks and can load scrap out of one and
iron ore out of the other. We have the luxury of space that
other people dont have. And we have good rail access with