The activities of Elemental Holding's subsidiaries in the segment of non-ferrous scrap metal recycling focus on the purchase and collection of scrap metal and its processing and preparation for re-use in industrial processes. The Elemental Group companies focus on obtaining waste containing industrial metals and their alloys: copper, bronze, brass, aluminum, lead, zinc, stainless steel.
The Elemental Group companies purchase raw materials in many forms, also with an unusual chemical composition, often waste from metallurgical processes (dross, furnace dust, furnace condensates, ashes) or refining processes (metal bearing slimes).
Materials that carry values include mainly:
Elemental Group operates on the non-ferrous metals market in the “urban mining” model. As a “urban mine”, it acquires metal from waste and scrap, which is a substitute for metal ore. Such a business model is characterized by high resistance to economic cycles and fluctuations in metal prices. Fixed costs of recycling companies as compared to costs of traditional mining enterprises are low. Margins applied are usually in the form of fixed quota margins, independent of the increase or decrease in metal prices. The price of purchased metals is variable. In this model, decreases in metal prices are usually passed on to scrap suppliers, and the quota margins applied do not fluctuate significantly. In comparison to the “urban mining” model, traditional mining enterprises are much more sensitive to decreases in metal prices due to the large share of fixed costs. The Elemental Group companies belonging to the non-ferro segment generate a stable margin.
The first stage of the recovery process consists in delivering scrap to plants of the Group companies through collection points by entrepreneurs involved in collecting it and private individuals. In the next step, scrap is cut, crushed, sorted and separated in the plants. Applied separation methods include using an electromagnetic field, optical separators, gravitational separators, flotation. The material is crushed to a fraction with a dimension that allows physical separation of the metal fraction from impurities or separation of various connected metals. As a result of advanced crushing and sorting processes, mixtures of metals and other materials are separated into high-value metal concentrates, plastics and process waste. In the next stage, full-value metal scrap or concentrates are delivered to recipients, which are mainly foundries, steelworks, as well as companies operating in the metal industry and traders.
Value for recipients and suppliers
The Elemental group companies operating in the non-ferro segment generate added value for both suppliers and recipients. Suppliers benefit from the offer of an extensive network of plants enabling easy access to the material collection points, an extensive specialized logistics network ensuring the receipt of goods from the supplier, quick material verification allowing for the determination of value, as well as rapid rotation and financial conditions ensuring liquidity, collection of the majority of products supplied by contractors.
Recipients of metals are provided by the Elemental group companies with constant supplies of metals and metal concentrates with stable quality parameters, scale and stability of supplies, independent logistics facilities ensuring deliveries in the JIT system.
The key advantage of the Elemental group companies operating in the non-ferro segment is the technological base ensuring high-performance processing of various types of scrap, including: high-performance crushers, in which the initial stage of scrap recycling is carried out, high-performance Rasper modules, in which further crushing and magnetic separation of steel takes place, and efficient water tables, purifying metal fractions from other non-metallic elements, eddy current separators, gravity separators. These machines allow obtaining metal fractions of 98-99% purity at the end of the whole process.
An important factor giving the market advantage is also well-equipped infrastructure consisting of a large area of built-up storage facilities, storage yards, railway sidings, own container and transport base.
One of the Syntom's advantages over its competitors is the extensive logistic
Suitable base and logistic facilities
Own transport adds flexibility and improves the decision-making process, creates value by offering "one-stop-shop" for both suppliers and customers
The non-ferrous scrap metal market in Central Europe is characterized by large annual volumes and high turnover. It is defragmented and many entities operate there.
Metal scrap can be divided into two groups in terms of specialization of market participants:
Due to limited resources of respective metals and high mining costs, more and more manufactured metals will be obtained from recycling. At the moment, 33% of world production of aluminum, 40% of copper, 35% of lead and 30% of zinc is obtained in the recycling process. Recycling provides direct savings in the production process and measurable environmental benefits. It allows measurable energy savings, reduced consumption of raw materials and emissions of pollutants compared to production from primary materials. Production of aluminum through recycling allows:
Industrial metals recovered by the Elemental Group companies from waste are used in all branches of production to manufacture new products. According to industry analyzes, the demand for base metals is systematically growing. This applies in particular to aluminum and copper as a pillar of modern solutions in the field of building machines and electro-mobility.
Increase in global demand for copper in the years 2012-2026p
Source: Bloomberg, Vestor DM
Global metal recycling market in the years 2017-2025p
Source: recycling-magazine, Vestor DM
In the years 2017-2030p, World Aluminum forecasts an increase in aluminum production in the world to 137 million tons at an average annual rate of 3%. The increase in production will be the effect of, among other things, higher share of aluminum scrap in the production process, which in the year 2030p will reach the level of 38% (vs. 33% in 2017), and this in turn will translate into an increase in annual scrap demand by4%.
Use of feedstocks for production of aluminum
Source: Bloomberg, Vestor DM
Production of aluminum and share of scrap in the production
Source: Bloomberg, Vestor DM
Global aluminium consumption
Aluminium Estimated Demand by End Use Sector (2017)
Currently, 30% of global aluminium production is derived from recucling, and this share will be increasing. Aluminium recycling helps to reduce air pollution by 95% and water by 97% compared with the production from aluminium ore.
The demand for copper is constantly growing due to dynamic development of the industry and housing infrastructure in Asia, dynamic growth of the volume of electronic devices in industry and households, increase in the number of electric vehicles.
Refined copper consumption
Copper Estimated Demand by End Use Sector (2017)
Currently, 30% of world copper production comes from recycling. Copper is 100% recyclable without loss of quality. It is estimated that 80% of copper that has ever been extracted is still in use.
The demand for lead, zinc, chromium and other base metals is similar.
The market on which the Elemental companies dealing with the recycling of base metals operate is organically growing. This applies both to the supply side where the increase results from a shorter life cycle of products and an increasing number of devices placed on the market, installations and infrastructure elements containing base metals. On the demand side, the constant growth of the market results from the growing demand for metals for manufacturing of new products. Growth on both markets is the foundation for the systematic development of the business of the Elemental Group companies based on a stable margin.
The Elemental Group companies dealing with the recycling of non-ferrous metals have a strong position on the European market. They are one of the largest suppliers of scrap to steelworks in Poland and in the EU (mainly Germany, Italy, Austria, Belgium, and the Netherlands), but also to India and China.
As part of the non-ferro segment, 3 companies operate with a total of nineteen plants in Poland and three in Slovakia.
Syntom – a market leader in Poland with an extensive, technological processing base and four plants: the main plant in Tomaszów Mazowiecki, in Bydgoszcz, in Poznań, in Piotrków and in Zabrze. Syntom consolidates material streams, processes them and delivers them to the Group's contractors. Syntom also provides comprehensive solutions related to purchase, transport and trading in secondary raw materials of steel and non-ferrous metals. Syntom has extensive logistics facilities in the form of several dozens of trucks and several hundreds of containers. More information at: www.syntom.pl
Collect Points – a specialized purchasing network aimed at buying material from other scrap collection points and natural persons. Collect Points aggregates volumes and delivers them to Syntom. Collect Points has fourteen branches in Białystok, Bielsko-Biała, Gdańsk, Kalisz, KonstantynówŁódzki, Kraków, Lublin, Olsztyn, Słupsk, Sosnowiec, Szczecin, Warsaw, Grodzisk Mazowiecki, and Wrocław.
Metal Holding – it holds a strong position on the Slovak market with plants in Presovice, Michalovce and Levice equipped with infrastructure enabling independent transport services (scales, loaders, containers).
A nationalwide network of non-ferrous metals collection in Poland and Slovakia, over 20 yards, over 132 000 m2, more than 25 trucks and 300 containers.
Majority of the locations have been functioning for more than a dozen of years with the same people managing them, which significantly strengthens relations with local suppliers of scrap metal.