Page 29 - IAR Recyclers News Press March / April 2013

Next Era in Catalytic Converter Recycling
Submitted by Legend Smelting
Page 29 Recyclers News Press
Over the last thirty years, Legend Smelting and
Recycling has been acquiring as well as processing
catalytic converters. As stated by Charles Darwin, “It
is not the strongest of the species that survive, nor the
most intelligent, but the one most responsive to
change”. In relation, change is an inevitable attribute
that is applicable to the maintenance of a successful
business. Therefore, at the beginning of 2013, Leg-
end Smelting will be making modifications that pertain
to the purchasing strategies of catalytic converters.
Nevertheless, I initially desire to share how this indus-
try began, and how this industry has evolved thus far.
Thirty years ago, the industry used a compressed
pricing structure in order to entice wrecking yards to
save all of their catalytic converters for recycling.
While certain converters commanded prices higher
than their net value, others were lower than their total
value. The previously stated tactic was utilized in or-
der to discourage auto recyclers from strictly assem-
bling valuable converters.
Moreover, in the early days, the shipments of the pre-
cious metals were finan-
cially lower in cost and
the infrastructures of the
low grade substrate col-
lections were new in de-
velopment as well as
refiners necessitating
the need for stock vol-
ume.
As time lapsed, the
E.P.A. increased its standards on smog emissions
and the shipments of the popular metals increased
within the business of converters. The usage of par-
ticular metals evolved as a result of the demand, the
necessity of performance, and the cost of the various
metals (ex. platinum, palladium, rhodium) that were
embedded within the converters. Extraordinarily, rho-
dium hit a high of $10,000 per ounce and marked a
historic expansion in the catalytic converter industry.
Furthermore, as the industry grows, the competition
increases as well. The shared knowledge of converter
values instigated a cherry-picking mentality, conse-
quently collectors originated and dissected converter
stockpiles to sell off to different processors. Unfortu-
nately, the previously mentioned technique failed to
work sufficiently for processors that use an element of
converter averaging in their pricing structure. There-
fore, refiners that unsuccessfully processed specific
converters with profitably began reselling entire con-
verters back into the market. In essence, Legend
Smelting and Recycling calls for a revolution in the
world of catalytic converters.
As of January 1 st, Legend Smelting and Recycling will
be using its knowledge of converter values to estab-
lish, to expand and to restructure converter categories
along with pricing on the basis of individual values.
We can use converter part numbers, extensive cur-
rent, as well as ongoing assaying in our lab to estab-
lish pricing. Selected converters will possibly be
paired with converters that were purchased in sepa-
rate categories prior to the 2013 alterations. The new
categories will shrink the disparity in values between
individual converters in their assigned categories and
will close the ability for “cherry-picking”. Elimination of
the “shell game” on the
street will generate further
balance as well as equality
within the industry. With this
understanding, if a seller is
quoted a price that is too
good to be true, then it
probably is too good to be
true. We believe that indi-
viduals that continue to at-
tempt beating the system
will plausibly emerge holding an assortment of con-
verters that they may only be able to sell at a loss.
We believe this change will be for the betterment of
the industry, and we are ready to help in any way to
facilitate this change and transition into the new era
with our customers.
Legend Smelting and Recycling Inc.
“It is not the strongest
of the species that
survive, nor the most
intelligent, but the one
most responsive to
change.”
Charles Darwin