The value of junk in these new times
A man drops off recyclable materials at Recology’s Recylce Central on November 16, 2016 in San Francisco, California. Photo by Justin Sullivan/Getty Images.
I got my first BB gun when I was about 9 or 10. Aptly, I looked almost exactly like Ralphie from the BB gun-centric storyline of the holiday classic, “A Christmas Story.” So now you have the picture.
Unlike Ralphie, I grew up in the 1980s on a family-owned salvage yard along the Mesabi Iron Range in northern Minnesota. My parents didn’t worry about me shooting my eye out because stray nails and tetanus posed a more persistent threat.
One day I realized something walking the back acres of our rusted steel graveyard: The sound that a BB makes when it strikes the windshield of a wrecked car is the most perfect sound on Earth. I liked it so much, I shot every windshield I could find. It took me a whole afternoon.
Looking back, it never occurred to me that I might be doing anything wrong. That is, until my dad came home furious. Some of those “bad old days,” the family would be lucky to pull in $100 from selling scrap. I had obliterated a couple thousand dollars worth of salvaged windshields in a single day. His punishment for me was the worst he could think of. I had to walk back to the shop to apologize to my grandfather.
My shaky legs carried me back to the Quonset hut where the men of my family overhauled engines. Grandpa sat behind the desk, waiting for me. Years later, I learned that he planned to read me the riot act, but he lost his nerve watching my blubbering slow walk up the road. Instead, he told me not to do that again and gave me some coins for the pop machine.
I learned a valuable lesson that day. A wrecked car may still contain valuable parts. Junk is just a different kind of asset.
Hot times for junk
These days it seems the junk business manifests throughout our economy and even our politics. The principles of the salvage trade seem well suited for the years that lie ahead.
Earlier this year, Minnesota Republicans elected state Sen. Jeremy Miller as their new majority leader. Miller comes from a family of junk dealers in Winona. True, my politics don’t often align with Miller’s. Nevertheless, I feel better knowing someone high up might also have played with a pretend pet made of car parts after all his real pets died from junkyard accidents.
Miller’s industry is called “recycling” now, of course, for obvious marketing reasons. People like the word “recycling” because it promises an environmentally friendly form of market capitalism. A little something for everyone.
But recycling was never really about the environment and still isn’t. Writer and sustainability advocate Sara Goddard is among those highlighting the negligible benefits of our favorite “green” solution to overproduction of disposable goods.
“The bottom line is that recycling is a profit-making business, not an environmental movement,” writes Goddard for her blog, Green That Life. “To be sure, when it’s done right, recycling can yield environmental benefits, but the main industry driver is demand for a particular recyclable substance. If there’s a robust resale market for that substance, then it will be recycled.”
We’re not just talking about the little blue container you keep under your sink. The scale of the recycling industry is massive.
That brings us to the new grand-daddy of the Iron Range, the iron and steel company Cleveland-Cliffs Inc. Cliffs is one of the oldest mining companies on the Mesabi Range and is now the largest steelmaker in America, having surpassed U.S. Steel last year. The company made this leap mostly on the strength of a new model of vertical integration, one that includes scrap metal like we used to deal at the junkyard.
Last month, Cliffs bought Detroit-based Ferrous Processing and Trading Company for $775 million, a major investment in a company that operates enormous junkyards across North America.
Why would a company want to buy twisted, mangled versions of its own product line? The answer is because of efficient new furnaces.
Traditional “old” blast furnaces use low-grade iron ore that has been crushed and hot rolled into taconite pellets that are about 65% iron. These were the pellets I saw steaming from the hoppers of Duluth, Missabe and Iron Range Railway cars headed south on the tracks behind the junkyard. But change is coming.
Electric arc furnaces make smaller batches of steel, customized to the specific demands of an increasingly fickle manufacturing sector. These new furnaces run on a combination of high-grade ore types and even scrap steel. The whole world is moving away from blast furnaces toward electric arc furnaces.
That’s why Cleveland Cliffs built a new “hot briquetted iron” (HBI) plant in Toledo, Ohio that uses a different, higher-iron-content pellet also made in northern Minnesota. Just last month, Cliffs announced that it would use one of its new acquisitions, the Minorca Mine in Virginia, Minnesota, to provide iron to its Silver Bay nugget-producing facility. There remains hope that Cliffs might build another HBI plant in northern Minnesota someday, and it’s plausible that they might.
They aren’t the only ones moving in that direction. In late October, Cliffs’ primary competitor U.S. Steel announced that it was expanding electric arc furnace production using iron from its Minnesota Ore Operations.
Blast furnaces and traditional taconite pellets remain a big part of the steel industry, but their share of the market will only decline in coming decades. The new scrap-burning furnaces are the reason why, and also the reason both U.S. Steel and Cliffs plan to be carbon-neutral by 2050. (And why they could do it faster if they really wanted to).
But it’s also why the Iron Range’s biggest industry, our entire vaunted iron mining tradition, is about to experience massive internal change. Soon, there will be fewer mines, better technology, higher-paying jobs and fewer workers. And, at least in part, it’s all because the industry is adding value to ores and, quite frankly, junk that it used to ignore.
Good junk vs. bad junk
Scrap might be a viable part of the steel and manufacturing industries, but it doesn’t reward endless waste. Yes, copper, steel and aluminum hold scrap value, but households don’t generate much of those more valuable materials.
A few years ago I chaperoned a Cub Scout field trip to the Itasca County solid waste department. I was surprised to learn that dry, corrugated cardboard was the most valuable recycled household material collected by the county. Most other everyday materials like glass, cans and paper were break-even propositions at best, and plastic was a net loss. In fact, across the country, cities and counties pay to recycle plastic. Much of it ends up in the trash anyway.
Thus, the plastic bottle on my desk right now costs more to recycle than it did to make. Prying open market factors like this explain why steel companies around the world are going carbon neutral while the plastic island in the Pacific Ocean keeps getting larger.
There are two big changes that seem to define our times. The first is that we can no longer expand for expansion’s sake. “Growth” will need to be directed inward. Collectively, we have to get better at using what we have.
The second is that we will not save the world simply because it’s the right thing to do. That’d be nice, but a quick scroll of my social media feed demonstrates that this is not how people think. Rather, we will save the world when we recognize the value of doing so — that the irreplaceable attributes of our natural world are, in fact, worth more than their destruction would bring.
In fact, the only thing that brings me any comfort about the state of the world right now is the inherent value of what I already have. We can find value in the parts and build something useful from the wreckage. But first we have to try.
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