Neal Frye, Entech Inc. 

July 3, 2009 Conversation 

phone: (269)483-2318 ext. 204 

cell: (574)612-5031 

Neal@4entech.com 

>Given the economic recession and potential forecast of declining demand for TDF, we’re 

looking at the potential for other markets to absorb the tires. 

>In Ohio there was a case a few years ago when the major consumers of TDF (different endusers) stopped taking on TDF. Since that was the only existing tire recycling market, it was a 

single-market system, so when it failed and there was suddenly a build-up of non-recovered tires. 

This is something that EPA is interested in, they want to understand on a national level, whether 

if TDF markets fail because of the economic recession, whether or not other markets could pick 

up the slack. 

And other things that we produce. Once the tires are ground down to the size of that tire turf, it 

also can be used in other applications. The one other application that potentially consume 

enormous, enormous amounts of tires would be rubberized asphalt. And we do sell into that 

market, but every state has its own issues when you start getting at a state level. That creates a 

difficulty because in every state you have to get people who are interested in using it who are 

involved in putting down pavement and they’ve been doing it their standard way. Breaking into 

that industry is very difficult. For example, there are states, MA, NJ but the only states that have 

used significant amounts are AZ, CA, TX, and FL. They’ve consumed a lot of it and the test 

results that come out of there are that the roads last longer, which is actually a problem. Don’t 

make as much money off it. By making a road last longer (and much quieter), I have been 

struggling last year to introduce it to the Midwest (Indiana). One lane, one mile long = 1,000 

tires. That market could open up a large, large, and the nice thing is that the roads, it’s not the 

end of life for it. Roads take up that overlay surface and grind it to put down a new road. Texas, 

if you look at their website – open grade friction course. AZ uses similar type. As it’s raining, the 

water and then disperses out to the end of the road. Spray off trucks is virtually eliminated. Doug 

Carlson is the President there, Rubber Pavements Association. Recycled rubber. 

Profit margin compared to TDF? 

>I think rubber asphalt and TDF have huge potential. TDF is huge though, it really really is. If it 

went away, it would be an enormous problem. As long as the power plants and the paper mills 

are being monitored closely as far as their emissions, it’s a wonderful use. At least one steel mill 

in AL that’s using scrap tires, also using carbon for high-carbon steel. And using other 

components like the oils for an ignition type agent. 

>We’re a long way aways from that. There are not enough markets to absorb crumb rubber. 

People make these (our investment is 2.5-3 million to take chips from TDF to crumb and then we 

can produce an enormous amount of this stuff). Melting down plastic with crumb rubber but 

we’re still on the forefront of that, and the companies still haven’t switched over. Overabundance 

of material—TDF helps so much—that you can back off your production of your one item. 
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If it went away, it would bankrupt so many companies. A couple notices – major crumb 

producers that have gone bankrupt and all their equipment is up for sale. The market to use all 

that material still isn’t. We’re just in the forefront of those markets. A lot of the crumb rubber 

products are really sub-standard. People buy them because they’re just trying to be generous to 

the recycling market. 

Rubber playground/rubber mulch. In the past we’ve used a lot of wood. In about 3 years it 

deteriorates and you have to freshen it up. Biodegradable product, so you’re making topsoil 

around the base of your house. Weeds come through the weed barrier. What happens when you 

don’t want it anymore? Companies shred it down further? They don’t want dirt, rocks, leaves in 

the material and all sorts of debris. Very expensive to try to sift through and clean. It’s not a huge 

volume. We = steady supply of hundreds of thousands of tires. Not very practical for companies 

to go around to each house and pick up. Could maybe make it aggregate system. Wal-Mart Æ

end-of-life. Just prolonging end of life. Adding possibly 10 years of life but not looking longterm. A road is considerably longer, can pick it back up, re-grind it, add more rubber, and put it 

back down. Using 60% back into the same road; other part they use for new roads. The rubber 

would not deteriorate. 

TDF--We need power. Cheaper fuel source. We’ve gone through a couple new startups. And I 

have become convinced that most power plants do as good a job of cleaning up the air with 

rubber as they do with anything else they burn. There’s a lot of mistrust. 

3⁄4 of a million dollars. From there to do to crumb rubber – another 1.5 to 2 million. For a small 

plant. And at that point, your crumb rubber is about 10 mesh. To go smaller, need more 

equipment to get to 40 or 50 mesh. 

TDF profit margin Æ $10-20 depending on how far away the power plant is. Probably a fair 

number. 

Crumb rubber Æ thought it would be greater but it’s not that much. 40 mesh, we’re seeing 

people selling that in the 16-20 cent range for 40 minus and we see that, the cost to produce it is 

probably above that 16-20 cent range. More like 18-19 cent range. What people are doing is 

screening it out; trying to sell the finer particles that are a byproduct. Could never set up a plant 

to make just 40 mesh – not viable. The crumb rubber market is being inundated with crumb right 

now, not enough companies using it and developing products for it. 

Gov’t should encourage end markets – create a pull. Instead a push on production. Gives 

an unfair confidence/edge to companies. Normally the people that get the grants are better 

financially off; states want to give money to a company that’s doing ok. 

 

Infill – for sports arenas, pulling in quite a big of material too. But I don’t believe they are 

terribly profitable. Too much available. 

Miracle to the whole system is asphalt. Convinced that once states approve this, it will be a huge 

benefit to the whole industry. Can sell within own state. Our state could consume every tire we 

process, easily. Profitable Æ on a larger scale?? 
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Playgrounds, in terms of volume, yah it’s ok. One playground takes 400 tires. One playground 

every 5 square miles. There’s nothing like a road. One thing about roads; there’s still room for 

improvement, making them quieter and safer. 

We’re going to take our company in that direction.