As the automotive recycling industry has grown and developed, there is an increasing amount of data being generated and studied by companies in the business, both large and small. Making sense of the data is, of course, another matter, and making it work for you is a key route to better profit.

Traditionally, the market has used average value per unit of recycled auto catalysts as its main data measurement. This worked reasonably well when there was no great variation between types of auto catalyst, but, as we all know, that world has changed. Today, successful recyclers are those that perform separate assays on the various auto catalysts.

There are essentially five types of catalyst that should be analyzed separately:

1. Original Equipment Manufacturer (OEM) Ceramic Converters 

OEM converters are those that were installed on vehicles at point of manufacture. These use a base material of cordierite ceramic that has been wash-coated with precious group metals (PGMs) - platinum, palladium and rhodium. They make up around 95% of all auto catalysts and have the highest precious metal loadings.

2. Original Equipment Manufacturer (OEM) Metal Converters 

Also manufacturers’ original equipment, the base material for these converters is stainless steel, also wash-coated with PGMs. They account for, approximately, the remaining 5% of converters and have similar precious metal loadings, but must be processed for recycling differently.

3. Diesel Particulate Filters (DPFs)

There are two categories of DPFs -

 - “high-grade”, which have sufficient PGM content to make recovery worthwhile

 - “low-grade”, which cost more in recovery charges than the returns generated.

 However, even for high-grade DPFs, there are issues for smelting companies due to the high silicone carbide content creating problems for the arc furnaces, and this results in higher recycling fees.

4. Aftermarket Converters

If a catalytic converter fails it is expensive to replace by the Original Equipment Manufacturer, and consequently an “Aftermarket” has developed offering significantly cheaper alternatives. These are made of the same cordierite ceramic base but a lower price is achieved by having a much reduced PGM content - often as much as 90% less.

5. Bead Converters

First on the market and used mainly on light-duty trucks, bead converters have low levels of PGMs, typically close to Aftermarket loadings. There are not many left to recycle and are usually processed separately due to that low PGM loading.

Up until recently, the majority of auto catalyst recyclers struggled to generate sufficient volume to separately assay each type, as most refiners required 2-8,000 lb. lot sizes. This pushed auto catalyst recyclers towards mixing the various types of catalyst, and whilst this is an acceptable means of operation for payment, it is not the best way to provide precise compensation for each of the converter types. Without doubt, separate, small lot assays makes it easier to spot data spikes that can act as profit/loss indicators.

Sorting the Mix

The refining process is often a mystery for many users of the service, despite the fact that it uses systematic sampling followed by both XRF and ICP machine analysis to determine the PGM contents. This is because XRF and ICP machines need complex formulas to accurately read samples, formulae that have developed over time to search for very specific elements contained in the different types of catalyst, and the materials vary significantly from each other - as we have seen, some have completely different base construction, others very different PGM loadings. Thus, if the substrates are mixed for assay, the laboratory machinery delivers results based on improper scientific assumptions. Bear in mind that no supplier of recycled auto catalyst is paid on what actually comes out of a furnace, so an accurate pre-furnace assessment of the catalyst is vital.

Whilst it is impossible to calculate exactly how much profit is lost by mixing different catalysts, we do advocate that materials should be separated, for two clear reasons:

  1. Laboratories are exceptionally accurate when identifying the recoverable PGM content of a given lot.
  2. Separate material assays give the recycler a very clear picture of the value of each material.

As a separate, but important, point, DPFs requires special attention. Since 2006 these have been produced using a silicone-carbide additive which makes them run cleaner by trapping carbon emissions from diesel fuel, but at the same time this has created significant challenges for the recycling industry. This is because the entrapped carbon, if not treated properly, can ignite and cause an explosion in the arc furnace. Smelting businesses are dealing with this issue by treating high carbon content DPFs separately, and this has increased DPF fees, with, in some cases, smelters rejecting loads outright. This will become a growing problem as DPFs made since 2006 are now fully entering the recycling stream and will increase pressure on recyclers to properly separate them from the other catalysts. Knowing this, the best course of action is to separate DPF right away to avoid losses and increase profits.

The Problem

In most countries, including USA, there have been, until recently, very few processors that are able to handle lot sizes small enough to guarantee the proper separations of materials. It is therefore important that recyclers employ trained, knowledgeable staff to do the sorting, especially if they are cutting converters and dealing directly with a smelter.

If lots are below the minimum weight requirement many catalyst processors will mix lots, often processing aftermarket material with regular auto catalyst, because the ceramic substrate base material is the same. However, because the PGM content is so different between the two types, it becomes difficult to quantify the results.  

The Solution

The simple answer to this problem is: find a processor who will work with you to identify and separately assay the different types of converters. This will enable you to interpret the data more precisely and improve your profitability. Smaller lots means better data and more accurate compensation for your materials. 

The ultimate ability to track consistency of results based on the type of catalyst material coming from multiple locations is only feasible by working with a processor willing and able to carry out assays on small lots.

What is a small lot?

The new breed of processor is putting pressure on the traditional “large lot” organizations by offering assays on quantities as low as 100 automotive converters or 200 pounds of ceramic. This means, nowadays, virtually every auto recycler is able to separate each of the different converters types and consequently gain access to better returns and better tracking of assay data. This also helps the recycler make informed decisions on the types of vehicle to purchase for recycling.

Competitive Advantage

We estimate that an average scrap converter that is assayed as part of an unseparated lot is worth around US$ 60. However, the true value of an OEM converter is nearer to US$ 80. And accurately sorted DPFs can be worth US$ 150 or more. These figures speak for themselves and, alone, make a compelling case for searching out that small-lot processor. In addition, by working with a company that offers small lot assays of 100 converters, a supplier is able to turn material faster, which in turn, allows some insulation against changes in PGM market prices. This will keep you ahead of competition and provide real control over your very valuable inventory.

Without a doubt, in today’s extremely competitive market, partnering with a converter processor that provides instant information feedback provides the opportunity to make converters a higher profit core.