Technical Options for Conservation of

Metals: Case Studies of Selected Metals and

Products

September 1979

NTIS order #PB80-102619

Foreword

The shortages in many critical metals and other materials that the United States

has experienced in recent years, along with its increasing dependence on foreign

sources of supply for those materials, has intensified interest in the prospects for

making less wasteful and more efficient use of materials.

This study explores the kinds and amounts of waste that occur in this Nation’s

use of eight critical metals and the technical options for reducing that waste. The

eight metals studied are: iron, copper, aluminum, manganese, chromium, nickel,

tungsten, and platinum. In their levels of import dependence and in other respects,

these metals are a representative sample of commercially important metals.

This study was requested by the Committee on Commerce, Science, and Transportation of the U.S. Senate. It should provide useful technical information for all interested in more efficient use of materials.

JOHN H. GIBBONS

Director
OTA Materials Advisory Committee

James Boyd, Chairman

Materials Associates

Earl H. Beistline Julius Harwood

University of Alaska Ford Motor Company

Seymour L. Blum Franklin P. Huddle

Northern Energy Corporation Congressional Research Service

Lynton K. Caldwell Elburt F. Osborn

Indiana University Carnegie Institution of Washington

Robert L. Coble Richard B. Priest

Massachusetts Institute of Technology Sears, Roebuck and Company

Lloyd M. Cooke

Economic Development Council of

New York City, Inc.

Frank Fernbach

United Steel Workers of America (retired,)

James H. Gary

Colorado School of Mines

Edwin A. Gee

lnternational Paper Company

Bruce Hannon

University of Illinois at UrbanaChampaign

N. E. Promisel

National Materials Advisory Board

Lois Sharpe

League of Women Voters (retired)

Raymond L. Smith

Michigan Technological University

Simon D. Strauss

ASARCO, Inc.

George A. Watson

Ferroalloys Association

OTA Project Advisory Panel

N. E. Promisel, Chairman

Independent Consultant

Seymour L. Blum Farno Green

Northern Energy Corporation General Motors Company

James Boyd Paul Lerman

Materials Associates Fairleigh Dickinson University

Edwin A. Gee Richard B. Priest

International Paper Company Sears Roebuck and Company

Julius J. Harwood

Ford Motor Company

NOTE: The Advisory Panel and the Materials Advisory Committee provided advice and comment throughout the assessment, but do not necessarily approve, disapprove, or endorse the report for which OTA assumes full responsibility.

//
OTA Conservation of Metals

Project Staff

Lionel S. Johns, Assistant Director

Energy, Materials, and Global Security Division

Albert E. Paladino, Materials Group Manager (through December 1.978)

Audrey Buyrn, Materials Group Manager- (from January 1979)

Marshall Peterson, Project Director

Materials Group Staff

Fred B. Wood Patricia L. Poulton Raymond B. Gavert

William M. Fitzgerald William Flanagan Barry D. Lichter

Materials Group Administrative Staff

Carol A. Drohan Bernadette Balakit

Jacqueline Robinson Elizabeth Al bury

OTA Publishing Staff

John C. Holmes, Publishing Officer

Kathie S. Boss Joanne Heming
Acknowledgments

This report was prepared by the Office of Technology Assessment Materials Group. The

staff wishes to acknowledge the assistance and cooperation of the following contractors

and consultants in the collection of information.

Battelle Columbus Laboratories

The George Washington University

Program of Policy Studies in Science and Technology

Rensselaer Polytechnic Institute

Pugh Roberts Associates, Inc.

The staff also wishes to acknowledge the contributions of the following individuals, on

detail to OTA in the early stages of the assessment.

Martin Devine, Naval Air Development Center

Elio Passaglia, National Bureau of Standards
Contents

Chapter!

1. Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . , . . . . . . . . . .

Technical options for Reducing Waste. . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Technical options for Reducing Losses From the Materials Cycle . . . . . . .

Technical options for Reducing Excess Metal in the Materials Cycle . . . . .

Summary of Technical options for Reducing Losses and Reducing Excess Metal

Preliminary Policy Considerations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Materials Objectives and Problems . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Illustrative Implementation options . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

II. Congressional Interest and Scope of Assessment. . . . . . . . . . . . . . . . .

Original Congressional] Request . , . . . . . . . . . . . . . , . . . . . . . , . . . . . . . . . .

Definition of Materials Waste and Conservation . . . . . . . . . . . . . . . . . . . . . . .

Scope of the Assessment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Selection of Materials for Detailed Study ... , . . . . . . . . . . . . . . . . . . . . . . . .

III. Quantification of Losses From the Materials Cycle. . . . . . . . . . . . . . . .

Iron and Steel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Aluminum . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Copper . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ... , . . . . . . . . . . . . . . . . .

Platinum-Group Metals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Manganese . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Chromium ., . . . . . . . . . . . . ... , ... , . . . . . . . . . . ... , . . . . . . . . . . . ,

Nickel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Tungsten. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Summary of Losses for Selected Metals . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

IV. Identification of Technical Options for Reducing Losses

From the Materials Cycle . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Unrecovered and Unknown Losses. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Losses in the Postconsumer Solid Waste Stream. . . . . . . . . . . . . . . . . . . . . . .

Losses in Dissipative Uses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Losses in Exports. . . . . . . . . . . . , . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Losses in Milling and Concentrating of

Losses in Metal Processing . . . . . . . .

Losses in End-Product Manufacture. .

Losses in Corrosion and Wear. . . . . .

Losses in Nonmetallic Uses of Raw Ma

Summary of Technical Options. . . . .

Ores. . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . . .

erials . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . . .

V. Design Review of Technical Options for Reducing Excess Material

in the Cycle . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Methodology. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Design Review of Selected Products . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

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I II
VI.

VII.

Analysis of the Most Significant Technical Options for

Reducing Excess Metals Use. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Substitution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Product Recycling (Product Rework and Reuse, Component Remanufacture )..

Substitution in the Construction Industry . . . . . . . . . . . . . . . . . . . . . . . . . . .

Eliminate Unnecessary Metal in Products . . . . . . . . . . . . . . . . . . . . . . . . . .

Extend Product Life..... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Extend Product Life of Refrigerators: An Example of Systems

Dynamics Methodology . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Reduced Use of Materials-intensive Systems, Such as Alloys. . . . . . . . . . . . . .

Summary of Options and Potential Savings . . . . . . . . . . . . . . . . . . . . . . . . . .

Preliminary Policy Considerations . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Introduction: Materials Conservation Objectives. . . . . . . . . . . . . . . . . . . . . . .

Materials Availability Problems. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Chronic Lack of Capacity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Import Dependency. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Energy Conservation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Cyclical Instabilities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Environmental Restrictions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Long-Term Depletion. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Technological Change . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Matching Conservation Options to Materials Availability Problems . . . . . . . . .

Illustrative implementation Options . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Establish a Governmental Contingency Planning Function. . . . . . . . . . . .

Establish a Public Data System. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Establish a Market for Contingency Shares Certificates. . . . . . . . . . . . . . .

Research and Development on Metal Substitution . . . . . . . . . . . . . . . . . .

Improve Product Aftermarket. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Establish Scrap Inventory. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Appendixes

A. Proceedings of a Workshop on Wear Control to Achieve Product Durability , . . . .

B. Conservation in World War II: 1933-45 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

C. Conservation and Shortages: 1946-77 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

D. Glossary of Terms. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

E. List of Working Papers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

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i ///

LIST OF FIGURES

Figure No.

1.

2.

3.

4.

5.

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7.

8.

9.

1 0.

11.

12.

13.

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B-1 .

B-2.

c-1 .

Metals Selected for Study. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Typical Materials Cycle. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Estimated Metal Losses for Each Loss Category, Expressed as a Percentage of

Domestic Mill Shipments . . . . . . . ..., . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Technical Options for Reducing Losses in the Materials Cycle . . . . . . . . . . . . . . . . . . . . . . . .

Classes of Excess Metal in the Materials Cycle. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Products Selected for Study. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Potential Savings From Technical Options by Reducing Excess Metal Usage, Expressed as a

Percentage of Domestic Mill Shipments . . . . . , . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Summary of Technical Options for Reducing Losses and Reducing Excess Metal . . . . . . . . . . .

Ability of Conservation Options to Meet Selected Materials Objectives . . . . . . . . . . . . . . . . . .

Energy Intensity at Each Stage of the Materials Cycle. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Context of Assessment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . , . . . . . . . . . . . . . . . . . . . .

Typical Materials Cycle. . . . . . . . . . . . . . . . . . . . . ., . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

iron and Steel Cycle: Flows and Losses, 1974 ......, . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Aluminum Cycle: Flows and Losses, 1974 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Copper Cycle: Flows and Losses, 1974 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Cycle for Platinum-Group Metals: Flows and Losses . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Manganese Cycle: Flows and Losses, 1974 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Chromium Cycle: Flows and Losses, 1974 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Nickel Cycle: Flows and Losses, 1974. . . . . . . . . . . . . . . . . . . . , . . . . . . . . . . . . . . . . . . .

Tungsten Cycle: Flows and Losses, 1974 . . . . . . . . . . . . . . . . . . . . , . . . . . . . . . . . . . . . . . .

Recycling of Obsolete Scrap. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Technical Options for Reducing Losses in the Materials Cycle . . . . . . . . . . . . . . . . . . . . . . .

Methodology for Evaluating Options for Reducing Excess Material in the Cycle . . . . . . . . . . .

Typical Disposal Pattern for Refrigerators. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Refrigerator Weight Reduction for Different Models as a Function Time . . . . . . . . . . . . . . . . .

Overview of Refrigerator Model Structure. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Refrigerator Model: Longer Mechanical Lifetime Case, Refrigerator Lifetime Over Time. . . . . .

Refrigerator Model: Longer Mechanical Lifetime Case, Employment and Sales Over Time . . . .

Refrigerator Model: Longer Mechanical Lifetime Case, Aluminum and Copper Consumption

Over Time. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Energy Intensity at Each Stage of the Materials Cycle. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Gross National Product, World War Il. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Conservation Policies During World War II. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Metal Shortages 1939-77 ....., . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

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Summary

. ’
I

Summary

INTRODUCTION

The shortages in many critical metals and other

materials that the United States has experienced in

recent years, along with its increasing dependence

on foreign sour-cm of supply for those materials,

has intensified interest in the prospects for making

less wasteful and more efficient use of materials.

This report explores the kinds and amounts of

waste that occur in this Nation’s use of eight critical metals and the technical options for reducing

that waste. The eight metals studied are: iron, copper, aluminum, manganese. chromium, nickel.

tungsten, and platinum. In their 1evels of import

dependence and in other respects, these metals are

a representative sample of commercially important

metals.

Metals are wasted, or lost, in two different ways:

1) amounts of metal are not productively used at

various points along the materials cycle, from mining of ore to product disposal, and 2) excess

amounts of metal are used in the materials cycle

for product manufacture. The study identifies, for

each of the eight metals, the levels at which each

kind of waste occurs at major points of the materials cycle. In general, the study finds that the greatest waste occurs in product use and disposal rather

than in metal extraction and processing or product

manufacturing.

Of the many options available to reduce losses

and reduce the use of excess metal, the study concluded that product remanufacturing, reuse, and

repair (collectively known as product recycling)

offer the greatest leverage for saving materials and

energy. Product recycling already exists in several

areas, such as auto parts, furniture, typewriters,

and aircraft. But additional incentives are needed

to encourage development of the aftermarket industry necessary for widespread recycling.

Perhaps of even more interest at this time, however, are options to improve materials availability

during critical situations, such as import embargos or disruption of transportation facilities or supply shortages. Options considered include the establishment of a governmental contingency planning function, a public data system, a private sector contingency market for essential metals, and

research and development on metal substitution.

* * * * *

This study was requested by the Committee on

Commerce, Science, and Transportation of the

U.S. Senate. The request was prompted by the

following three factors:

First, the 1973 OPEC oil embargo demonstrated

the risks of U.S. dependence on foreign energy resources and focused attention on the possibility of

similar problems with mineral resources for which

the United States is also heavily import-dependent.

Second, in 1973-74, the increased demand for materials due to economic recovery from the 1969-70

recession led to supply shortages for a wide range

of metals, thus generating concern among U.S. industrial consumers about the reliability of future

supplies. 1 Third, U.S. per capita consumption of

minerals has grown to more than four times the

world average, prompting renewed attention on

how to reduce consumption through conservation.

The study focused only on metals. Other materials might well have been considered, such as

chemicals, wood, and plastics. But at the time this

study was initiated, metals were shortest in supply.

The eight specific metals selected for detailed

analysis are listed in figure 1. The three major criteria used in selecting these metals were: level of

import dependence, degree of importance to

American industry, and the nature of use (e.g., volume, price, product applications). As a group, the

eight constitute a reasonable cross section of commercially important metals. Most are substantially

imported, as indicated in figure 1. However, while

the group of eight is representative, other metals,

such as tin and cobalt, constitute important omissions.

This report does not include detailed discussion

of conservation options for recovery of metals from

municipal solid waste, the subject of another OTA

I S<.(l ~~)p, C for a d~(~i]ed discussion.

3
4 . Metal Losses and Conservation Options

and Energv From Municipal give detailed consideration to the full range of imOTA-M-93, Nor does this report pacts of conservation options.

Figure 1 .—Metals Selected for Study

Metal s :

iron . . . CopPar

Atumhwn

‘1 . .

“Mtinganka-‘9!%%’

Ctuemwt ““’-?W%

,Nkkel “ > ‘m%

Tun#Mn -.;-

I

a Net I m port rel lance = I reports ml nus exports plus adjustments for government and

industry stock changes 1978 data from U S Department of the

Interior, Bureau of Mines, Mineral Commod/ty Summaltes

1979 pp 45

b Refers t. the P[atlnum group metals, which Includes platinum Palladlum rhodium

ru then IU m, urld turn and osmium

SOURCE OTA based on data from U S Bureau of Mines

TECHNICAL OPTIONS FOR REDUCING WASTE

Technical Options for Reducing Losses

From the Materials Cycle

Losses from the materials cycle represent a major potential for waste. A typical materials cycle is

shown in figure 2, which illustrates the total flow of

a metal beginning with its extraction from the

ground and processing of the ore to its manufacture, use. and disposal in the form of products.

Losses can occur at each step in the cycle and particularly in the disposal stage where ultimately the

product must be either stored, recycled, or discarded.

By tracing the flows of the eight metals through

the materials cycle—from mining to disposal—the

total losses for each metal were identified. Losses

were calculated by subtracting the output at each

stage of the materials cycle from the input. For example, the losses in processing aluminum were

calculated by subtracting the output, mill products

(7.2 million short tons) and mill scrap (5.8 million

short tons), from the input. The input in this case is

the sum of imported ingot and alloy elements,

bauxite and alumina, and recycled scrap for a total

of 13.4 million short tons. The difference is 0.4 million short tons, which represents the loss of aluminum during processing. All losses were verified

through discussion with the appropriate industry.

Almost 100 percent of every metal was accounted

for.2

Figure 3 gives estimates of losses expressed as a

percentage of domestic shipments of mill products

of the metal (e. g., steel shipped by steel mills). In

other words, these loss figures are expressed as a

percentage of the amount of mtetal flowing at one

place in the cycle, shipments of mill products,

which is the traditional industry measure of productive output.

Excluding platinum and manganese, the total

losses of the selected metals range from 55 to 78

percent. These losses occur over the life of the

products containing the metal, which may range

from 1 to 50 years. In reality, losses during mining,

processing, and manufacturing occur during the

‘For a [olnplctc dis([issioll of how 10ss(+ ~~(’r(~ (j[]alltifi(d,

s(’f_’ (’11 Ill.
Ch. I—Summary 5

Figure 2.—Typical Materials Cycle

TL

Milling &

concentrating

Notes:

Metal recycling

Metal

exports I

Product remanufacturing

Product reuse

+ 1

Metal Metal /

Product Product

extraction processing manufacture utilization disposal

TranSpoti & processing Nonmetallic Corrosion

handling & wear Post

use of Dissipative consumer Unrecovered

raw materials uses solid

waste

v

L

=

v

L

v

L

first year. Losses during use

Maximum losses for any of the metals studied exceeds

20% of 1974 domestic mill shipments.

Maximum losses for any of the metals equals 10 to 20%

of 1974 domestic mill shipments.

Maximum losses are less than 10%

The triangles are intended to give only an approximate indication of the

relative level of losses. Generalizations are difficult due to the wide

variability of losses for individual metals. See figure 3 for metal-specific data.

SOURCE. OTA, based in parrt on data from Working Papers One and Two.

and disposal stretch

over - the lifetime of the product, from 1 year for

cans and 15 years for refrigerators to 50 or more

years for buildings.

The loss of platinum is only 15 percent, due to

the very high recycling rate for this precious metal.

on the other hand, the loss of manganese exceeds

1()() percent, due to the primary use of this metal in

steel production. More manganese is lost in the

steel making process (e.g., as slags) than is contained in the steel products actually shipped.

For each metal the total loss is a sum of a large

number of smaller losses that occur at every stage

of the materials cycle. This dispersal of losses is a

major harrier to effective overall waste reduction.

However, some stages of the materials cycle experience greater loss than others, as illustrated in

figure 3. The four largest loss categories are:

Unrecovered metals in obsolete

products . . . . . . . . . . . . . . . 5-37% lost

Dissipative uses of metals as alloys,

powders, pigments (e.g., catalysts,

paints, fertilizers) . . . . . . . . . . . . .4-23 % lost

Milling and concentrating losses prior

to metal smelting . . . . . . . . . . . . Nil-19X lost

Metal losses through export of scrap

and mill products . . . . . . . . . . . 0-17 % lost

The technical conservation options with the

greatest leverage in reducing each category of loss

are shown in figure 4. The most highly leveraged
6 ● Metal Losses and Conservation Options

Figure 3.—Estimated Metal Losses for Each Loss Category, Expressed as a Percentage of

Domestic Mill Shipments (1974) -

40

30

I

Mn = 122%

Ni

Cu

w

‘e Mr

Cr

41 Pt

Fe = Iron

Cu = Copper

Al = Aluminum

Mn = Manganese

Cr = Chromium

= Nickel

I’ = Tungsten

Pt = Platinum gro Jp

(n

I

Ni

Cr

w

Cu

Pt

Al

I

~

Fe

J

Mn

=.-

E

20

10

0

Fe

Cu

Al

w

dn N

E

al

v

ii

Q

Mn

w

Al

Al W

Fe

Mn

Cu

Mn

Al Cr

c

.-

Cr

w

Al

Fe

Cu

~i Pt mm

Loss category

NOTE See chapter Ill, tables 20 and 21 for data on which flqure 3 IS based

SOURCE OTA based on data from Working papers One an-d Two

options are metal recycling, product remanufactur- constant demand). This will elimi nate the losses

hat would have

hat amount of

ing and reuse, R&D on substitute materials and (e.g., milling and concentrating t

processes, and R&D on metal recovery from low- been associated with producing

grade ores. metal.

Metal recycling and product remanufacturing

have multiple leverage because, in addition to the Technical Options for Reducing Excess

direct reduction in losses of unrecovered metals in Metal in the Materials Cycle obsolete products, these options lead to an additional savings in future years. For example, if Losses from the materials cycle, as discussed

through product recycling an additional 10 percent above, represent one of two major classes of waste.

of obsolete office equipment in a given year is re- The second class of waste is the use of excess

manufactured, 10 percent less metal will be re- metal in the materials cycle. The different types of

quired for next year’s production run (assuming excess metal usage are shown in figure 5.
Ch. l—Summary ● 7

Figure 4. —Technical Options for Reducing Losses in

the Materials Cycle

Loss category Range of losses* Technical conservation option

Unrecovered metals 5-37% Metal recycling

Product remanufacturing and reuse

Dissipative uses 4-23% R&D on substitute materials

and/or processes

Milling & concentrating Nil-19% R&D on metal recovery from

low-grade ores, e.g. fine particle

technology

Exports of scrap & mill o-17% Export controls

products

Postconsumer solid waste 5-1470 Product recycling

Metal processing 0.5-1 2% Capital replacement

(Mn=122%) Alternative desulfurization process

(for Manganese)

Nonmetallic uses of raw Nom-11% R&D on substitute metals

materials & processes

End-product manufacture Nil-3% Improved management controls

Corrosion and wear Nil-3% R&D on improved corrosion and

wear resistant treatments

Transportation & handling Nil-3% Improved management controls

● Range of losses for the eight metals in percent of 1974 domestic mill shipments.

See figure 3 and tables 20 and 21 in chapter Ill for metal-specific data.

Nom = small but undetermined amount of losses.

Nil = amount of losses close to zero.

SOURCE OTA based in part on data from Working Papers One and Two

The seven major products listed in figure 6 were that contained the metals under evaluation. Thus,

selected as case examples in order to evaluate 25

options for reducing excess metals These products

were selected as typical of five major U.S. industries that collectively account for about 60 percent

of total metal consumption in the United States.4

As a group, these products use the selected metals

in amounts typical of many metal products. Analysis of additional products was conducted where

necessary. For example, office equipment, pipelines, and television sets were included in the analysis of product recycling.

Estimated metal savings for the case examples

were then generalized to a whole range of products

‘IJ( )1 1 I)(’ ( ( )1111 )1(’t(’ Il\t ot 01)[ lolls (’i (Illlilt(’(i, \(’(’ tiit)lt’ 21, [’t)

L’

1s(,(, t;~t)lo :;:1 , (’t). VI

if 10 percent of the steel used in automobiles could

be saved by a stress-optimized design, that percentage was applied to the amount of steel used in

all transportation products.

Figure 7 shows the percent of 1974 domestic

mill shipments of each metal that could be saved

by each conservation option listed.

These numbers are engineering judgments of

the overall conservation potential for the listed options. The numbers are interdependent in that implementation of one option will reduce the savings

possible with another option. Also, the percentages shown indicate the savings that are technically possible. Economic and other factors may severely limit the actual savings.

51-680 0 - 79 - 2
8 ● Metal Losses and Conservation Options

Figure 5.—Classes of Excess Metal in the Materials Cycle

Type of excess metal use Reasons for excess metal USe

t

— Use of a

scarce metal

I I

I 1 b =*~=

Excess metal

in cycle —

●

,

I

Inadequate repair facilities

Lackof a second-hand

Lack of product - -

reuse i

Inadequatedisposal options

7

— Excess inventory and production ,

Lack of standardized parts

Overstock invertories

Production overruns

Use of materials- Materials-intensie approaches

intensive systems Complex alloy systems *

SOURCE OTA

Figure 6.—Products Selected for Study

I Product ‘ I Industry I D

I Automobile I Transportation ‘ I

Refrigerator

Building

Bridge

Lathe

Tractor

Can

Appliances

Construction

Machinery

Fabricated metal products

Three additional categories have been added to

figure 7 for comparison purposes: major redistributions, minor redistributions, and use of stocks. The

major redistributions option is based on experience with use of allocations during World War 11.

The use of stocks option is based on the amount of

metal that went into stocks during 1974. Although

1974 may not be a typical year, these numbers

give some basis for comparison. (See pages 10 and

11 for an explanation of these categories).

Metal substitution, product remanufacturing and

reuse, and savings through some sort of redistribution or allocation system, offer the largest potential

for reduction of excess metal usage.
Ch. l—Summary ● 9

Figure 7.— Potential Savings From Technical Options by Reducing Excess Metal Usage, Expressed as a

Percentage of Domestic Mill Shipments (1974)

co

$

E

n

i

m

90

<

60

50

40

30

20

10

0

.

.

.

—

Al

Cu

Cr

Mn

NI

Fe

cl,

Fe

Al

Mn

Cr

NI

w

F/In

rl,

Al

NI

Pt

.

Fe = Iron

Cu = Copper

Al = Aluminum

Mn = Manganese

Cr = Chromium

Ni = Nickel

W = Tungsten

Pt = Platinum group

(-L

Fe

Al

[

LL

Al

Fe

Ni

Cr

NI

Cr

7

Ni Al Ni

Fe

CL rl,

Al Cr CL

Fe

Fe

Cr Pt Cr Ni

Al

Technical options for reducing excess metal usage

NOTE See ch VI table 36 for data on which figure 7 IS based

SOURCE: OTA based on data from Working Paper Three
10 . Metal Losses and Conservation Options

SUMMARY OF TECHNICAL OPTIONS FOR REDUCING

LOSSES AND REDUCING EXCESS METAL

A summary of the technical conservation options is presented in figure 8, which includes options for reducing losses (designated by ‘L’) as well

as options for reducing excess metal (’E’). The percentages shown give the range of potential savings

for the eight metals studied, rounded off to the

nearest 5 percent. These percentages are nonaddictive, since many of the options are mutually exclusive, such as product recycling and metal recycling. The purpose of figure 8 is to show which options offer the most potential for conservation of

metals.

The percentages shown in figure 8 represent the

maximum technical potential for conservation.

The actual amounts may be considerably less due

to various barriers to implementation and undesirable impacts and costs. Only options with 10 percent or more potential metal savings for at least

one metal have been included.

The conservation options are, of course, metal

specific as indicated by the wide range of percentages. A metal like platinum, which costs over

$2,000 per pound, offers only limited additional

opportunities for conservation. Metals used primarily for alloys (such as manganese and chromium) require different options than do the basic

structural metals (iron, copper, aluminum). However, in this summary, the options are discussed

only in general terms. s

Each of the technical conservation options

presented in figure 8 is discussed below.

Major redistributions.—A review of the

World War 11 experience (see appendix B) showed

that from 50 to 90 percent of several of the metals

studied were diverted from their then current use.

During wartime, when flexibility became absolutely necessary, major metal savings in the civilian

sector were accomplished with a very tight allocation system that drastically reduced the domestic

products that could be manufactured and consumed. Production was diverted to war products,

so severe economic consequences were averted.

5For the complete metal-specific discussion 0[ options, see

[’tls. Iv, v, and V1.

This would not necessarily be the case in peacetime. The World War 11 experience indicates the

upper limit for conservation in the civilian sector

under crisis conditions.

Metal substitution.–Con:iderable potential

flexibility enters into materials use via the substitution option. However, several major impediments

must be overcome. First, a successful substitution

can often take years to implement. Second, many

products are manufactured with a highly specialized production process that is costly to change. If

the substitution option is to be acceptable, greater

flexibility must be built into the production process

so that alternative metals can be used. Third, every

substitution involves a risk that will add to the

product cost. Strong financial incentives will be required to overcome these barriers.

A special case is the construction industry,

which uses 10 to 20 percent of metals. This industry is not tied down to a specific production process. For example, considerable dollar savings (on

the order of $15 million out of a total cost of about

$60 million) are found to be possible by substituting concrete, plastics, and fiberglass for iron and

copper in the construction of a typical 40-story office building. Substitution is a common practice in

the construction industry, particularly where local

labor practices and customer preferences are favorable.

Use of nonmetallic coatings.--A substantial

percentage of certain metals (cadmium 60 percent,

chromium 5 percent, cobalt 18 percent, nickel 13

percent, tungsten 8 percent) is used to coat steel or

alloys for corrosion and wear resistance. Use of

nonmetallic coatings could save considerable

metal. However, additional R&D is required to sufficiently develop such coatings.

Metal recycling.—Some industrial scrap is effectively recycled. Estimates of the potential for additional recycling of obsolete scrap (from products)

range from 5 percent for platinum to 40 percent for

copper.

6 Unfortunately, obsolete scrap metal has a

limited market and competes with virgin ore of

‘lFor the detailed estimates. see fiqure 11, ch IV,
Ch. I— Summary ● 11

Figure 8.— Summary of Technical Options for Reducing

Losses and Reducing Excess Metal

Option Potential metal savings

(%o of 1974 shipments)

E Major redistributions (e.g., through 50-90

allocations)

E Metal substitution 15-60

E Use of nonmetallic coating 5-50”

E Product remanufacturing 10-45

L Metal recycling 5-40

E Product reuse 5-30

E Use of stocks 5-30

L Reduce dissipative uses 5-25

L Reduce milling and concentrating losses 0-20

E Metal substitution in construction 0-20

E Minor redistributions (e.g., through 5-15 allocations)

L Reduce post consumer waste 5-15

L Export controls on scrap and mill products 0-15

E Eliminate unnecessary metal in products 5-1o

E Increase product life 5-10

E =Promising options for reducing excess metal used in the materials

cycle See figure 7 for metal specific data

L =Promising options for reducing metal losses from the materials cycle

See figure 3 for metal specific data

“ For cadmium

SOURCE: OTA based on data from Working Papers One, Two and Three

Materials and EnergyFrom Municipal Waste (Washington,

D.C. : U.S. Congress Office of Technology AssessmentI July:

1979). OTA-M-93 .

ject,8 this option offers major potential for conserving metal, saving the energy already invested in

products, and reducing the environmental pollutants associated with the manufacturing process.

One major barrier to product remanufacturing and

reuse is the lack of the necessary industrial infrastructure.

Another major barrier is economic. To be economically attractive, a product must be remanufactured at a cost that will allow a resale price at a

reasonable discount under the price of a new product. For many current products, this discount averages 60 percent. However, for other products there

is no difference between new and reworked product pricing.

‘I)l ( 1(1[1( I Rt ‘111<11 II 11(1( t Ill 1 Ilq 1;l ~f Ill)), Al ~i (’1111) (’I 1 ! ~~ly, ( ~)-

\l )( )11 \( )1 t ‘( I I)\ 1 I I( ‘ ( I s ( )Ifl( (’ (If ‘[’(’( I 11 I( )1( ),q\ f\\w’\\l I I(’ I II , I I s

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$
12 . Metal Losses and Conservation Options

Product remanufacturing is not a new concept

and is extensively carried out for a wide range of

products and components. Automotive parts are

probably the best example of what can be accomplished when the economic conditions are favorable. Products that are most likely to be remanufactured are those with higher initial costs, where

appearance or styling is not a problem, and where

there is an abundant supply of used products to remanufacture.

For products where remanufacturing is feasible

but economically marginal, two major barriers exist. First, the concept of a “used” product runs

counter to established traditions and even regulations. The second major barrier is the lack of established industries to remanufacture and resell that

product. The recycling business is labor-intensive

and may not have as high a rate of return as

others. Therefore, if product remanufacturing is to

be encouraged, some additional investment incentives may be necessary, such as low-interest loans

or tax benefits for plant and equipment, and perhaps tax credits or deductions for leased products

made of recycled parts and materials.

Reduce dissipative uses.—Dissipative uses

involve the dispersal of metals and alloys by chemical action or physical dispersion during use. For

example, aluminum pig and aluminum scrap are

often used during the deoxidation of steel. The aluminum is lost as an oxide in the slag. Relatively

few options are available to reduce waste here.

Most technical options have significant performance penalties, or increased costs, or both. In some

cases, R&D programs to find substitute materials

and/or processes might be successful.

Reduce milling and concentrating

losses.–Althougth relatively large quantities of

metal may be lost in the milling and concentrating

stages, the value of the material lost is low and the

cost of further recovery is high.

One option is to increase imports of high-grade

ore concentrate. But this raises serious questions

about the amount of risk associated with import

dependence versus the increased costs of energy

and environmental controls that would be required in domestic processing of lower grade ores.

Another option is to invest in a major R&D program, perhaps building on current U.S. Bureau of

Mines research, directed toward increased recovery of metal values from lower grade ores.

Minor redistribution (through, e.g., allocations, export controls, use of stocks).—

During emergency situations, these options could

reduce metal usage with relatively minor effort, for

example, allocations that encourage the use of

proven substitutes in industries where changes in

production equipment would not be necessary.

The exact percentage saved would depend on the

timing and specific metal, but could be as high as

30 percent.

Reduce postconsumer waste.—Options for

reducing postconsumer waste are discussed in

another OTA report, Materials and Energy From

Municipal Waste, July 1979, OTA-M-93. However,

once metals enter the municipal solid waste (MSW)

stream, their recovery is generally more difficult

and at present is limited to aluminum cans and ferrous metals (along with paper and glass). Options

such as product recycling may offer significant energy conservation and environmental quality benefits when compared to sources separation and centralized recovery from the MSW stream.

Eliminate unnecessary metal in products.—Strong economic incentives already exist

for careful design to avoid unnecessary uses of

metal, for example, material costs, shipping

weights, and handling costs. A though some further elimination of excess metal is possible, the difficulties include increased manufacturing costs, increased cost of investment in engineering and

equipment, decreased durability. and reduced safety.

For example, for the refrigerator, an estimated

11 lbs of steel could be saved of the 70 lbs now

used in the outer shell. However, this would add

$30 to the manufacturing cost for a plastic

substitute and related adhesive and finishing, and

would create moisture and flammability problems,

among others.

Increase product life.—Technically, longer

mechanical life can be designee into many products. But longer life can often be more costly and

may not result in a significant increase in the actual average lifetime. Many products are retired

due to obsolescence, appearance style changes, or

other reasons not related to mechanical condi-
14 ● Metal Losses and Conservation Options

Figure 9.—Ability of Conservation Options to Meet Selected Materials Objectives

Most

promising

technical

options

(from

figure 8)

Illustrative

implementation

options

SOURCE: OTA.

Selected materials objectives

Improve materials

availability during

critical situations

Major redistribution (e.g.,

through allocations)

Metal substitution

Use of stocks

Metal substitution in the

construction industry

Minor redistributions

Export controls

Public data base

Contingency planning

function

Market for contingency

shares certificates

Research and development

on metal substitution

after market busi -

ish a scrap invenin recycled prodReduce waste of

materials and

conserve energy

Increase metal recycling

Increase product

remanufactureing

Increase product reuse

Reduce dissipative uses

Reduce milling &

concentrating losses

Reduce postconsumer waste

Eliminate unnecessary metal

in products

Increase product life

Public data base

Improve product aftermarket

(e.g., establish a scrap

inventory, encourage

product leasing, provide

loans to establish

aftermarket businesses)

availab]e to Congress is to centralize a materials

contingency planning function in the Government.

This organization would be responsible for evaluating the severity of perceived threats to materials

supply, and developing contingency plans on a

commodity by commodity basis. Such a function

could be an extension of the scope of work now

performed by various existing offices and bureaus.

Public data systems. A public data base on materials would help to improve the quality and quantity of information available to Government and to 

industry for better analysis and forecasting on materials supply and demand problems. It would also

help identify R&D needs for solving or alleviating

technical problems in the materials cycle.

These two implementation options, contingency

planning and a public data tree, have been studied

in detail in an earlier OTA report on Information 
Ch. I—Summary 13

tions. Up to 50 percent of all products removed together account for 12 to 28 percent of metal

from service are still in working condition, ac- usage, depending on the metal. Even if the maxcording to one recent report on the subject.9

imum savings per product (27 percent)10 were apLonger product life would best apply to transpor- plied to the maximum base of 28 percent, this

tation and consumer durables (appliances) which would result in only a 7.5-percent metal saving.

I l~~d~e(j (j[l I tle dIIIOU rlt Of IIwtd WY’WI per product per l’(’~~r

W’, David Corm, F{ICIC)KS Aftw[[ng Product Lifet[rws, NSF/ with a 50-percent increase in mec ]a[lical I ifetime, See ch-. V],

RA Report 780219, August 1978. ttible 32 and related discussion.

PRELIMINARY POLICY CONSIDERATIONS

As summarized above, the primary focus of this

study was the assessment of technical options for

conserving metal. However, preliminary consideration was given to materials objectives and problems and a range of possible implementation options that should be taken into account in policy

discussions on materials conservation.

Materials Objectives and Problems

Conservation is a response to a real or imagined

threat or condition. Conservation options are implemented in attempting to accomplish some objective. The primary objectives of concern in this

assessment have been reducing the volume of

waste and improving materials availability. There

are a number of other objectives that might be relevant to public policy, such as conserving energy,

stabilizing materials markets, protecting the environment, or promoting a resource-conserving

society.

Materials availability, either short term during

critical situations or long term with respect to

resource depletion, is a vital concern to both industry and society. Without the proper materials,

many industries would be forced to close unless

alternative plans were made well in advance. As

shown in appendix C, materials shortages have

been commonplace for many years and will undoubtedly continue in the future. Conservation is a

possible response to these problems.

Energy conservation can affect the availability of

materials. Since metals refining consumes about 9

percent of the energy budget and all materials consume about 20 percent, materials conservation

could be a response to the need for energy conservation. More realistically, in the foreseeable future,

energy conservation will probably be more important than materials conservation.

Materials conservation may be an appropriate

strategy to deal with a large number of other problems that threaten materials availability, such as:

chronic lack of capacity in the metals industry, import dependency for essential metals, cyclical instabilities in supply and demand for metals, and

environmental restrictions on the mining and

processing of metals.

Illustrative Implementation Options

This study briefly considered several methods

for implementing the more promising technical

conservation options. Both technical and implementation options are listed in figure 9 as options

to improve materials availability during critical

situations and/or to redue waste and conserve

energy. The impacts of these options were not

assessed in detail.

Improve product aftermarket. Product remanufacturing, reuse, and repair I collectively known as

product recycling) offer significant leverage for

conserving materials and energy. Improved aftermarket (the market for recycled products) would

help to reduce the mixing of scarce materials with

the landfill waste stream as well as to improve the

rate of recovery of the major metals—iron, steel,

aluminum, and copper.

Improved product recycling to capture the

residual value in products through a strengthened

aftermarket would eventually have implications

for the entire materials cycle. Twenty possible
Ch. l—Summary 15

Figure 10.— Energy Intensity at Each Stage of the Materials Cycle

Key

x Cement, clay, glass

● Iron & steel

O Aluminum

❑ Coppe r

A Other materials

i- All, whenever appropriate

Average energy

intensity/ail

sectors

●

\

o

A

Minin g Refinin g Fabricatin g Industria l Consume r Produc t

products products maintenance

Market for contingency ShareS certificates, in this

implementation option, a private sector market for

contingency shares certificates would be established between materials suppliers and industrial

customers of basic materials. This option would be

a private allocation system.

R&D on metal substitution. Substitution promises substantial savings for specific metals. Discov-
16 ● Metal Losses and Conservation Options

ering the available substitution options is in part a

product of Government-sponsored R&D. Research

programs to develop practical substitutes for scarce

materials, with particular emphasis on products

with high metal use, nonmetallic coatings for corrosion and wear resistance, and dissipative uses

could be established.

Summary

The implementation options presented above

avoid Government intervention in private decision

processes to a large extent. Instead, they enable

the private sector to more efficiently deal with their

own needs while reducing the uncertainties and

vulnerabilities for all parties. These means of implementation are to a great extent self-correcting.

They do not require constant Government adjustment of standards or regulations in order to

achieve a balance of interests. Nor do they involve

excessive costs for administration, monitoring, enforcing, or recordkeeping.

This set of illustrative options is mutually reinforcing. The contingency planning and public data

base support all other options. The contingency

shares certificate market would moderate the extremes of materials supply and demand fluctuations. Substitution is very much the result of a

private sector decision process. But through Government R&D, substitution can also be an important instrument of national materials and energy

policy. Improvements in the product aftermarket

will contribute to greater efficiency in materials use

but could also provide an institutional mechanism

to advance many other objectives such as energy

conservation and environmenta protection.
1 1 .

Congressional Interest and

Scope of Assessment
II m

Congressional Interest and Scope of Assessment

ORIGINAL CONGRESSIONAL REQUEST

This report is in response to a request from the

Senate Commerce Committee in 1975 and since

reaffirmed by the Subcommittee on Science, Technology, and Space Of the Senate Committee On

Commerce, Science, and Transportation. This report also responds to interest expressed by the

House Committee on Science and Technology and

several other House and Senate committees concerned with conservation of natural resources in

the U.S. domestic economy.

This report focuses on one major aspect of resource conservation, namely, the conservation of

materials—and more specifically metals— through

reduced waste in the materials cycle.

Following the congressional request, this report

addresses:

● the kinds and amounts of materials wastage,

Q techniques or technical options for reducing

wastage,

. technical and institutional impediments to applying these techniques.

At the time this study was requested, the then

recent (1973-74) shortages of many materials and

the threat of future shortages were of particular

concern to the Nation. Thus, emphasis in this

study was placed on identifying conservation options that can improve materials availability—that

is, the degree to which materials can be acquired

on a timely basis.

DEFINITION OF MATERIALS WASTE AND CONSERVATION

Waste has two connotations: 1) residual material

left over from processing, manufacture, and use;

and 2) useless or unnecessary consumption, that

is, materials use for which there is no adequate

justification. The first definition of waste is precise

in that it refers to specific losses that could be

recovered if there is sufficient economic justification. The second definition is judgmental and

depends on the conditions and incentives under

which consumption takes place.

For example, under the conditions of an embargo on imported copper, it might be considered

wasteful to use copper for plumbing since substitutes are available. On the other hand, during conditions of oversupply, it might be considered

wasteful not to use copper.

In addition to changing conditions, there are

changing incentives. Thus, for products containing

excess metal, it may be the judgment of the manufacturer that the cost of waste is less than the cost

of its elimination. But if there are sufficient economic, social, or political incentives, in many instances the excess metal can be removed. Here,

the incentives, rather than the material scarcity,

drive the elimination of unnecessary consumption.

Since the conditions and the consequences of

consumption are difficult to define, the approach

chosen in this study was to document losses from

the materials cycle or losses that result from excess

material in the cycle. The primary question then

becomes: where are the losses that could be

avoided should the need for conservation arise?

In traditional thinking, conservation has, like

waste, two connotations: reducing usage as a response to an immediate or current shortage, or reducing usage to ensure that future needs will be

adequately satisfied. In both cases, the concern is

with the adequacy of supply, although the timing is

different (short v. long term). Studies of conservation traditionally have almost always dealt with the

long-term mineral supply and demand condition.

The definition of conservation used in this report is a more general one: reduced usage of resources as a response to either short-term supply

interruption or long-term depletion. The important

19
20 ● Metal Losses and Conservation Options

aspect of this definition is that the reduced usage

be for some “cause” or to meet some societal objective. It is these “causes” or objectives that

SCOPE OF THE

The context of this assessment is illustrated in

figure 11,

Materials availability is subject to short-term

threats and conditions and long-term depletion for

which some response, either public or private, is

required. Possible short-term threats and conditions include:

●

●

●

●

●

●

●

●

chronic lack of capacity,

import dependency,

energy shortages,

cyclical materials shortages,

environmental restrictions,

international cartel actions,

deteriorating U.S. balance of payments, and

escalating U.S. inflation.

These threats and conditions are discussed in

more detail in chapter VII.

As shown in figure 11, a variety of strategies are

available to cope with materials availability problems, not all of which are materials strategies. One

materials strategy is conservation. Others include,

for example, stockpiling and expanded domestic

production.

Literally

ined in an

A variety of options are available to

distinguish reduced usage for conservation from

reduced usage due to normal supply/demand fluctuations.

ASSESSMENT

conserve materials (substitution, recycling, use of

less metal in product design etc.). For convenience, these options may be classified as those

that reduce the losses from the materials cycle

(e.g., reduce wastes) or those that reduce the

amount of material in the cycle (e.g., reduce the

excess material designed into products or unnecessary inventories).

While materials availability is the concern in

this study, it is only one of several that can motivate conservation. Other concerns might include

the equity of world distribution of resources or the

environmental impact of materials consumption.

These are not considered as objectives in this

assessment.

In addition, while technical options for conserving materials receive major attention, public policies for implementing these options are given

only preliminary consideration Finally, this report

does not assess the impacts of either the technical

or implementation options on the economy, energy conservation, environmental quality, employment, and the like.

SELECTION OF MATERIALS FOR DETAILED STUDY

hundreds of materials could be exam- the metal is won from its ores, and the nature of its

assessment of materials conservation. uses.

Two criteria were used for selecting the specific

materials to be analyzed in this assessment: 1) economic and strategic criticality and 2) the nature of

the materials and their usage. In the last several

years, five major reports have been published dealing with supplies and uses of critical materials.

Each of these reports developed a list of critical

materials, as summarized in table 1.

In addition to criticality, a variety of characteristics relating to each material were examined: volume, price, import dependence, ease with which

On the basis of these characteristics, eight

metals were selected: chromium, manganese,

nickel, platinum group, aluminum, copper, tungsten, and iron and steel. This selection represents a

reasonable sample of metals that are commercially

important.

For example, iron and steel, aluminum, and

copper are basic metals to which minor amounts of

alloying elements are sometimes added. Manganese and chromium, on the other hand, are used

primarily for their properties as alloying elements
Ch. 11—Congressional Interest and Scope of Assessment ● 21

Figure 11 .—Context of Assessment

I Objective I

Materials

availability

? f

Long-range Short-term b* w

trends threats & conditions

J w

Materials

problems

t

Materials 4 1

strategies f

v ● 1

Materials Expand

Stockpiling conservation domestic

strategy production

+ I m

To reduce To reduce

Iosses from amount of

materials cycle materials used

in cycle

Implemental ion

options

t

I lmpacts I

SOURCE: OTA
22 . Metal Losses and Conservation Options

in other

both as

alloying

basic metals. Nickel and tungsten are used

basic metals in nonferrous alloys and as

elements in other basic metals. Platinumon the other hand, are often embodied in small

components of end products, and salvage is more —

difficult.

group metals are representative of precious metals.

With respect to the way metal products are used in Ot

articles of manufacture, at one end of the

are iron, copper, and aluminum. These

spectrum

often are

major elements in finished products, and thus are

readily salvageable. Precious metals and tungsten,

ered,

her materials might well have been considsuch as chemicals, food wood, industrial

gases, paper, rubber, textiles, ceramics, and plastics. However, in the context of materials availability, metals represent the most critical materials.

Table 1 .—Critical Materials

Army War Metals

Materials Dyckman a SRl b Collegec Battened Stockpile e

selected

Petroleum . . . . . . . . . . . . . . . . x

Chromium . . . . . . . . . . . . . . . . x x x x x ●

Manganese . . . . . . . . . . . . . . . x x x x x ●

Titanium. . . . . . . . . . . . . . . . . . x

Nickel. . . . . . . . . . . . . . . . . . . . x x x x x ●

Platinum group . . . . . . . . . . . . x x x x ●

Aluminum . . . . . . . . . . . . . . . . x x x x x ●

Columbium . . . . . . . . . . . . . . . x x

Antimony. . . . . . . . . . . . . . . . . x x

Cobalt . . . . . . . . . . . . . . . . . . . x x x x x

Thorium . . . . . . . . . . . . . . . . . . x

Vanadium . . . . . . . . . . . . . . . . x x

Copper. . . . . . . . . . . . . . . . . . . x ●

Mica . . . . . . . . . . . . . . . . . . . . . x

Florine . . . . . . . . . . . . . . . . . . . x

Graphite. . . . . . . . . . . . . . . . . . x

Tungsten . . . . . . . . . . . . . . . . . x x x x x ●

Asbestos . . . . . . . . . . . . . . . . . x x

Tin . . . . . . . . . . . . . . . . . . . . . . x x x x x

Mercury . . . . . . . . . . . . . . . . . . x x x

Titanium. . . . . . . . . . . . . . . . . . x x

Tantalum . . . . . . . . . . . . . . . . . . x x

Magnesium ... , . . . . . . . . . . . x

Iron. . . . . . . . . . . . . . . . . . . . . x ●

aEdward J Dykman, “Review of Government and Industry Studies on Materials Supply and Shortages, ” in Syrnposium of Critical Materials, Proceedings, U S Depart.

ment of Defense, Dec 16, 1974

bMark D. Levine, Department of Defense Materials Consumption and the Impacf of Material and Energy Resource Shortages, November 1975, prepared by Stanford

Research Institute and available from U S. Department of Commerce, NTIS #AD-A018-613.

cU.S. Army War College, A Study of Critical Materials, May 1976.

dA.M. Hall, A Survey of Technical Actlvities and Research Opportunitie Affecting the Supply of Metallic Structural Materials, September 1974, prepared by Battelle,

Inc and available from NTIS # PB 246106.

eNational Materials Advisory Board, A Screening for Potentially Critical Materials for the National Stockpile, 1977 NMAB329.

SOURCE: OTA, based on reports cited above.
Ill.

Quantification of Losses From

the Materials Cycle
HI

Quantification of Losses From the Materials Cycle

MNng&

concentrating

Notes:

Figure 12.—Typical

rectly (from a knowledge of the amount of material entering and leaving a given stage) From these data, the

major loss categories were identical.

Losses from the 1974 materials cycle were estimated

for eight metals: iron and steel, aluminum, copper,

platinum-group metals, manganese chromium, nickel,

and tungsten. Data on materials flows and losses for

1974 were used. The year 1974 was chosen for several

reasons. First, that year represented a high level of

economic activity and resource usage. The following

year, 1975, was a recession year when resource usage

and flows were depressed and possibly distorted. Further, when this assessment was initiated, only fragmentary data were available for 1976.

The estimates presented here are given in summary

fashion. Substantially more detail is available in Volume

II—Working Papers. In particular. Working Paper One*

(vol. II-A) providesbasic data in support of the estimates

of losses from the materials cycle and materials consumption by end use. These data provide the basis for

estimating the quantities of wastage.

Materials Cycle

Metal recycling

t t +

Metal

~

Metal End product ~Product ~Product

extraction processing manufacture utilization disposal

J

handling Poet

Dissipative consumer Unrecovered raw materials uses waste

v

L

= Maximum Iosses for any of the metals studied exceeds 20% of 1974 domestic mill shipments.

v

L = Maximum losses for any of the metals equals 10 to 20% of 1974 domestic mill shipments .

I

25
IRON AND STEEL

Domestic iron and steel plants in 1974

shipped about 124 million tons* of iron and

steel products to manufacturers and fabricators. In addition, 16 million tons of iron

and steel mill products were imported and

nearly 6 tons were exported. Of the more

than 134 million tons of iron and steel mill

products used by end-product manufacturers and fabricators, nearly 111 million tons

of iron and steel were embodied in end

products in 1974. The remainder was returned to iron and steel plants and foundries

in the form of prompt scrap.

Iron and steel mill products represent by

far the largest tonnage of basic metal used in

the United States. The tonnage of iron and

steel used is roughly 20 times that of the

next largest metal—aluminum. It is important to consider the conservation options for

iron and steel because of the sheer size

the iron and steel industry, the magnitude

*All data are given in short tons (2,000 lbs).

Table 2.–1974 Distribution of Products

Manufactured From Iron and Steel

(millions of short tons of iron and steel alloys)

of

of

— Market category - . Quantity

Automotive ... ., 17.2 ‘

Machinery, including equipment 18.5

Rail transportatio n 56

All iron and steel casting s 12.3

Construction, including maintenance 152

Contractors product s 12.0

Electrical machiner y 5.0

Shipbuilding and marine .

Agricultural 3.0

Appliances ~ 3.9

Other domestic equipmen t 3.8

Container s 9.3

Ordnance and militar y 1.0

Mining, quarrying, etc . 1.0

Oil and gas drillin g 075

Aircraft and aerospace o.15

Total . 1108

SOURCE Working Papers One and Two

its use of energy, and its importance in the

manufacture of almost every product.

Estimates of flows in the iron and steel cycle and summary losses from the cycle are

given in figure 13. The total losses shown in

figure 13 amount to about 79 million tons.

This is nearly three-quarters of the total

amount of iron and steel embodied in products in 1974.

Estimated amounts of ferrous materials

entering useful life in 1974 are given in table

2. Table 2 provides a broad market breakdown of the amount of iron and steel embodied in end products in 1974. By using

estimates of the useful life of iron and steel

products and data on past production and

use of iron and steel, amounts of iron and

steel that became obsolete in 1974 were

estimated. Table 3 gives a breakdown, by

market category, of the estimated 72.5

million tons of iron and steel that became

obsolete in 1974. Estimates of the amount of

obsolete iron and steel scrap that was recovTable 3.–Obsolescence of Iron- and

Steel-Containing Products in 1974

(millions of short tons in ferrous materials)

Assumed average —

useful Iife

Market category (years) Quantity

.—

Automotiv e 13 12.3

Machinery, including equipment 9.0

Rail transportation 3.0 6.5

AH iron and steel castings 10.0

Construction, including maint. 30 7.5

Contractors products 27 4.2

Electrical machinery

Shipbuilding and marine 30 0.8

Agricultural 20

Appliances 11 2.8

Other domestic equipment 12

Containers <1 9.6

Ordnance and military 15 10

Mining, quarrying, etc. 04

Oil and gas drilling 30

Aircraft and aerospace 20 0.1

Tota l 725

SOURCE Working Papers One and Two -

ered and recycled in 1974 are given in table

4, classified by broad category of product

from which the scrap was derived. The loss

category designated “unrecovered and unknown” (in figure 13) represents the difference between the calculated value of obsolete products (72.5 x 1 0

6 tons) and that

which is accounted for by recycling, postconsumer solid waste, corrosion and wear,

and dissipative uses.

From the preceding data, estimates of the

total losses from the domestic iron and steel

cycle in 1974 were as follows:

Nature of loss

Milling, concentrating, and handling

Unrecovered and unknown

Postconsumer solid waste.

Scrap export s

Processing in iron and steel plants

Disssipative use s

Corrosion and wear

Manufacturlng losses

Tota l

Table 4.–Recycling and Recovery of Iron

and Steel in 1974

Millions of Pershort tons centage

Market category of metal recycled

Automotiv e

- - 10. 9 ‘

-

89

Machinery, including equipment 69

Rail transportatio n 5.6 86

All iron and steel castings 24 24

Construction, including maint. 22 29

Contractors products 16 38

Electrical machinery 11 42 OL -1. 8> d(llpuutlu(((y Clllu IIlcll IIIG 0.6 75

Agricultural 04 25

Appliance s 02 7

Other domestic equipment 02 7

Containers. 0.2

Ordnance and military 02 20

Mining, quarrying, etc 01 25

Oil and gas drilling 01

Aircraft and aerospace 00 _

Total .32.7 45

SOURCE Working Papers One and Two
Ch. Ill—Quantification of Losses From the Materials Cycle ● 27

b

co

Ui

.

02 (

0

0)

u)

L%-1

(n

c

0

Q

z

a.

(u

z

(n
In 1974, the aluminum industry produced

about 7.2 million tons of aluminum. It exported about 0.5 million tons, placed in

stock about 0.4 million tons, and shipped

about 6.3 million tons to end-product manufacturers, of which 5 million tons were embodied in end products. Except for minor

manufacturing losses, the remainder was

returned to primary aluminum plants, secondary smelters, or aluminum foundries in

the form of prompt scrap.

ALUMINUM

is given in table 5. Table 6 presents estimates of the amount of aluminum and aluminum alloys contained in products that became obsolete in 1974. The breakdown by

market category is based on assumptions of

useful life in each of the product categories.

Table 7 indicates the amount of obsolete

scrap recovered from obsolete products in

1974 classified by market category. A total of

about 343,000 tons of aluminum was recovered and recycled.

lion tons of aluminum content. This loss is

sizable, particularly in relation to the 5 million tons of aluminum that were embodied

in useful products in 1974.

Nature of losses Millions of tons

Postconsumer solid wastes 1.0

Other uses of alumin a 0.5

Exports of ingot and mill products () 5

Unrecovered and unknown ().4

Losses in bauxite mining and

alumina productio n 0.4

Aluminum processin g 0. 4

Figure 14 presents a summary of the Losses from the domestic aluminum cycle Dissipative uses of scrap 0.4

flows of aluminum in the U.S. economy and in 1974, based on data in the foregoing para- Other uses of bauxit e 0.3

the losses from the aluminum cycle in 1974. Dissipative uses . ().2

Figure 14 indicates that 5 million tons of

graphs are shown to the right. Losses in end-product manufacture 0.1

aluminum were embodied in end products The total losses from the domestic alumi- Total ., ... ., 4.2

in 1974. A market breakdown of this figure num cycle in 1974 amounted to over 4 milTable 5.–Products Manufactured Table 6.–Obsolescence of Aluminum Table 7.–Recycling and Recovery

From Aluminum in 1974 Products in 1974 of Aluminum in 1974

(millions of short tons of aluminum alloys) (millions of short tons of contained aluminum) (millions of short tons of aluminum alloys)

Market category Quantity

Buildings and construction . . . ., ... ., 1.43

Electrical products . . . . . . . . . . . ., . . . . . 0.85

Transportation products 0.80

Containers and packaging. . . . . . . ~ . . . . 0.78

Consumer durables . . . . . . 0.44

Machinery and equipment. ., ... ... 0.40 Other . . . . .

. . . . . 0.30

Total.. ~ . . . . . . . . . . ~ . . . . . . . . 5.00

SOURCE: Working Papers One and Two

Assumed

useful life

Market category (years) Quantity

Building and construction 30 0.1

Electrical products ... ~ ~ ~ 30 0.013

Transportation products, . . . . . 10 0.5

containers and packaging . . . . <1 0.78

Consumer durables . 10 0.3

Machinery and equipment ., . . 20 0.1

Other. ., . . . . . . . . . . . . 10 0.1

Total . . . . . . . . . . . . 8 1.893

Percent Quantity

Market category recycle recovered

Building and construction. 15

Electrical products . . . . 92

Transportation products. ... 34

Containers and packaging ... 7

Consumer durables. . . 14

Machinery and equipment 25

Other. ... . . . . . . . 29

Total 18

0.015

0.012

0.169

0.052

0.042

0.025

0.028

0.343

SOURCE: Workinq Papers One and Two

●
Ch. IIl—Quantification of Losses From the Materials Cycle ● 29

u

OJ

h’

0

0

m I

IL

q

w

C7

0
The production of copper in 1974 from

domestic, primary, and secondary operations amounted to about 2.7 million tons.

About 2.2 million tons of copper and copper

alloys were embodied in end products in

1974.

The tonnage of copper used in the United

States is third largest, after steel and

aluminum, of the basic metals consumed. Of

the basic primary metals, copper also ranks

third in consumption of energy.

Estimates of the flows of copper in the

domestic materials cycle are given in figure

15.

Table 8.–Distribution of Copper End

Products to Major Use Categories in 1974

(millions of short tons of copper and copper alloys)

Market category Quantity

Buildings and construction ... 05

Transportation. ., . . . . . ., ., 0.2

Consumer and general ., 0.5

Industrial machinery. ... . , 0.4

Electrical and electronics . 0.6

Total. ... ., ., . . . . 2.2

SOURCE: Working Papers One and Two

COPPER

An estimate of the copper embodied in

end products in 1974 by major end-use category is given in table 8. This end-product

distribution has not changed significantly

for the past several years. The estimated

amounts of copper and copper-base alloys

that became obsolete in 1974 are given in

table 9. The quantities shown are based on

the shipment data available for prior years

and on an average estimated useful life for

each of the product market categories. Estimates of obsolete copper and copper alloys,

which were recovered as scrap in 1974, are

given by end-use market category in table

10. The total amount of obsolete scrap recyTable 9.–Obsolescence of CopperContaining Products in 1974

(millions of short tons in ferrous materials)

Assumed

average

useful life

Market category (years) Quantity

Buildings and construction. 30 0.2

Transportation . . 12 03

Consumer and general. . . . 10 0.5

Industrial machinery ., . . . . 20 0.3

Electrical and electronics . 10 0.7

Tota l 2.0

SOURCE Working Papers One and Two

cled in 1974 amounted to about 0.56 million

tons.

From the foregoing data and estimates,

losses from the domestic materials cycle in

1974 were estimated as follows:

Nature of losses

Unrecovered and unknow n

Millin g .

Dissipative use s

Postconsumer solid wastes

Smelting and reflnin g

Brass mills, wire mills, etc

End-product manufacturin g

Tota l

Table 10.–Recycling and Recovery of

Copper and Copper Alloys in 1974

(millions of short tons of copper and

copper alloys)

Percent

Market category recycle Quantity

Buildings and construction. . . 25 0.05

Transportation ., . . ., 57 0.17

Consumer and general. ... 20 0.10

Industrial machinery ., 13 0.04

Electrical and electronics ... , 28 0.20

Total ... ., 0.56

SOURCE Working Papers One and Two
Ch. III—Quantification of Losses From the Materials Cycle ● 31

.

■

o

‘N

o

m

—

A

L A

Y

)

A

f=

N

N

0

&

al

>

m

o

1
PLATINUM= GROUP METALS

The six metals included in the plati

group, in order of annual consumption

platinum, palladium, ruthenium, rhod

inum

are

ium,

iridium, an-d osmium. Prices for all six metals of the group are very high—between $50

and $450 per troy ounce. The platinum

group metals are used primarily as catalysts

and in electrical and electronic applications.

The flows and losses of platinum-group metals are considered to be representative of

one class of precious metals.

A simplified flow diagram is given in figure 16 showing the flows of platinum-group

metals in the domestic materials cycle and

losses for the year 1974. As shown in figure

16, about 3 million troy ounces of platinumTable 11 .–Products Manufactured From

Platinum-Group Metals in 1974

(millions of troy ounces of platinum-group metals)

Market category Quantity

Chemicals. . . . . . . . . . . . . . . . . . . ... 0.58

Petroleum ., . . . . . . . . . . . . . . . ., . . . . 0.73

Glass . . . . . . . . . . . . . . . . . . . . . . 0.19

Electrical. . . . . . . . . . . . . . . . . . 0.80

Automotive ... . . . . . ., , ... . . . . 0.50

Dental, medical, jewelry, and misc. 0,25

Total. . . . . . . . . . . . . . ., ., 3.05

SOURCE Working Papers One and Two

group metals are used by end- product users

and fabricators with only a minor manufacturing loss; essentially the same amount was

embodied in end products in 1974. Table 11

shows a breakdown by market category of

the products manufactured from platinumgroup metals in 1974. Most of the usage of

platinum-group metals in chemicals and petroleum was in the form of platinum catalysts. The practice of toll refining for these

major users of catalysts is very large. Nearly

1 million troy ounces per year are toll-refined. Table 12 gives estimates of the

amount of platinum in products that became

obsolete in 1974. As with the previous metals, these estimates were based on the

Table 12.–Obsolescence of PlatinumGroup Products in 1974

(millions of troy ounces of contained

platinum-group metals)

Assumed

average

useful life

Market cateqory (years) Quantitv

Chemicals . . . . . . . . . . . . . . . . . c 1 0.72

Petroleum . . . . . . . . . . . . . . <1 0.69

Glass . . . . . . <1 0.19

Electrical. 20 0.31

Automotive ., . . . . . . . . . . . . . . 6 –

Dental, medical, jewelry, and

misc. . . . . . . . . . . . 20 0.13

Total ., . . . 2.04

SOURCE Working Papers One and Two

assumed average life for each of the categories. About 1.64 million troy ounces of

platinum-group metals were recovered from

obsolete products in 1974 and recycled. A

breakdown by market category of this

amount is given in table 13.

From the above, the losses of platinumgroup metals from the domestic cycle in

1974 were as follows:

Millions of

Loss troy ounces

Dissipative . . . . . . . . . (),25

Processing . . 0.015

Unrecovered and unknown 0.014

End-product fabricators and users 0,009

Total ... ., . . 0.288

Table 13.–Recycling and Recovery of

Platinum-Group Metals in 1974

(millions of troy ounces of platinum-group metals)

Estimated

percentage

of obsolete

platinumgroup metals

Market category recycled Quantity

Chemicals . . . . . . . . . . ... 85 0.61

Petroleum ... ., . . . . . . 97 0.67

Glass . . 9 8 0.19

Electrical. ~ ., . . . . . . . . . . . . . 45 0.14

Automotive . . . . . . . . 0 –

Dental, medical, jewelry,

and misc. . . . . . . . . . . . . , 20 — 0.03—

Total ., ., . . . . . . 80 1.64

SOURCE: Working Papers One and Two
Ch. III—Quantificatjon of Losses From the Materials Cycle . 33

(n

. .

IA

\

u

u

.

0mo

m I

I ‘.

m

08

1

- u

+

o

0

D

cm
About 90 percent of the domestic usage of

manganese is in the production of iron and

steel. Although manganese, in amounts

usually on the order of one-half to 1 percent,

is important to steel properties, the predominant use of manganese is as an inexpensive

chemical reagent in the desulfurization (and

sulfur control) and deoxidation of steel. The

other major domestic use of manganese is

primarily as a chemical reagent.

The flow of manganese and losses from

the domestic manganese cycle are given in

figure 17. About 1.5 million tons of contained manganese were used by the metallurgical industries, while about 0.12 million

tons were used in chemical processing. Of

the 1.9 million tons of contained manganese

entering the metallurgical industries, only

0.8 million tons remain in the metal that is

shipped to metal fabricators. The loss of 1.1

million tons occurs in processing (steel).

MANGANESE

Referring again to figure 17, the net manganese content in end products entering useful

life in 1974 was about 0.7 million tons. TO a

first approximation, the analysis of obsolescence and losses from the consumer cycle for manganese would be similar to that

for steel. Estimates of the amounts of manganese that became obsolete in 1974 were

based on the end-use pattern of steel, estimates of the amount of iron and steel that

became obsolete in 1974, and on the

amounts of iron and steel that were recovered and recycled in 1974. On those bases,

it was estimated that 0.5 million tons of contained manganese became obsolete in 1974,

and of that, 0.2 million tons of obsolete

manganese were recycled in 1974.

The pattern of losses from the domestic

manganese cycle is different from the patterns of losses from other materials cycles,

mainly because of the high processing

losses. As has been mentioned, the loss is

associated with the use of manganese as an

inexpensive chemical reagent in the desulfurization (and sulfur control) and deoxidation of steel. These high processing losses

can be reduced technologically by an order

of magnitude or more through the use of

higher cost reagents and processes. The

losses from the domestic manganese cycle

in 1974 were estimated to be as follows:

Nature Of losses

Process losse s

Unrecovered and unknown

Postconsumer solid waste

Dissipative use s

Corrosion and wea r

Transport and handling

Milling losses of domestic ores

Manufacturing and fabricating

Milliosn of tons

1.1

 0.15

0.08

0.05

0.03

0.023

0.012

0.009

Tota l 1454
Ch. III--Quantification of Losses From the Materials Cycle ● 35

I

1

CN

t

0

Q

(u

G

a

I

-.

In

?“

t

U-I

0

0

cd

0- t

Lc
Chromium is used primarily as an alloying element in stainless and heat-resistant

steels; in chemicals, including those required for plating; and in refractories.

Although chromium is expensive as a metal

($2.60 per lb), it is as low-priced as ferrochrome (30 cents to 45 cents per lb of contained chromium) or as the ore (28 cents per

lb of contained chromium). Figure 18 presents the flows and losses in the 1974

domestic chromium cycle. About 840,000

tons of contained chromium in the form of

chromite, ferroalloys, and scrap are consumed in materials processing and manuCHROMIUM

facturing. Figure 18 indicates that of the

724,000 tons of contained chromium used

by end-product manufacturers, 639,000 tons

were embodied in end products in 1974.

Table 14 lists end products manufactured in

1974. Table 15 gives estimates of the

amount of chromium contained in the end

products that became obsolete in 1974.

These estimates of obsolescence were based

on assumed values of useful life for each of

the product’s market categories. Table 16

presents estimates of the amount of obsolete

chromium that was recovered and recycled

in 1974. Most of the 51,000 tons of contained chromium recycled in 1974 was recovered from transportation equipment and

industrial machinery.

Based on the foregoing, losses from the

chromium cycle in 1974 were as follows:

Losses Thousands of tons

Dissipated uses . . . . . . . . . . . . . . 113

Unrecovered and unknown . . . 110

Process losses . ... 83

Manufacturing losse s

Corrosion and wear . . . . . . . . . . . . Ni l

Total ., . . . . . . . 311

Table 14.–Products Manufactured From Table 15.–Obsolescence of Chromium- Table 16.–Recycling and Recovery of

Chromium-Containing Materials in 1974 Containing Products in 1974 Chromium in 1974

(thousands of short tons of contained chromium) (thousands of short tons of contained chromium) (thousands of short tons)

Market category Quantity

Construction ., . . . . . . . . . . . . . . . 128

Transportation ... ., . . . . . . . . . . . 102

Machinery. ., ... 85

Refractories. ., ., 71

Chemicals and plating. .. . 77

Fabricated metal products . . . . . . 77

Other ., . . . . . . . . . . . . 99

Total . . . . . . . . . . . . . . . . . . . . ., . 639

SOURCE Working Papers One and Two

Assumed

average

useful life

Market category (years) Quantity

Construction ., 30

Transportation . . 13

Machinery. ., . . . . . ., 16

Refractories. ., . . . . . . . 1 1⁄2

Chemicals and plating. ., 10

Fabricated metal products ., ., 10

Other ., . . . . . . . . . ., 15

Total 

 Ulii . .

29

39

20

55

58

39

34

274

SOURCE Working Papers One and Two

Estimated

percentage

of obsolete

chromium

Market category recycled Quantity

Construction ... ., . . . . 10 3

Transportation . . . . . . . 60 23

Machinery. ., . . . . . . . . . . . 55 11

Refractories. . . . . . . ., . . . – –

Chemicals and plating. ., . . . . . – –

Fabricated metal products 10 4

Other . . . . . . . . . 30 10

Total . . . . . . . . . . . . . . 51

SOURCE Working Papers One and Two

●
Ch. Ill—Quantification of Losses From the Materials Cycle ● 37

m
NICKEL

Nickel is a relatively high-priced ($1.74

per lb in 1974), moderate-volume (250,000

tons industrial demand in 1974) specialty

metal. About half the annual consumption is

by the steel industry in the manufacture of

stainless and heat-resisting steels and in

alloy steels. One-fourth is consumed in the

manufacture of heat- and corrosion-resistant

nickel-base alloys and superalloy. About

one-eighth is used in electroplating, and the

remainder is used as an alloying element in

other nonferrous alloys and in various

chemical and miscellaneous uses.

Estimates of the flows and losses from the

total domestic nickel cycle are given in figure 19. Referring to figure 19, about 252,000

tons of contained nickel were used by endproduct manufacturers, of which about

211,000 tons of contained nickel were embodied in end products in 1974.

The estimated amount of nickel embodied in end products in 1974 by product

category is given in table 17. From a

weighted average of product life for the

various broad market categories, the overall

“life” of nickel-containing products is probably about 18 years. In the year 1956, an

estimated 170,000 tons of nickel in end

products entered service. Hence it was

estimated that this amount would become

obsolete in 1974.

Table 17.–Estimated Nickel Embodied

in End Products in 1974

(thousand short tons)

Market category Quantity

Appliances . 13

Other domestic equipment ., ... ~ ~ 9

Ordnance and military . . . . . . . . . 5

Construction ., ... . , 7

Contractors products. . . . . . . . . . . 16

Automotive ... . . . . ... . . . 40

Rail transportation . . . . . . . . . . . . . 5

Shipbuilding and marin e 12

Aircraft ... 18

Oil and gas. ., 10

Mining, quarrying ., . . . . . . 5

Agricultural equipment .. . 3

Machinery and industrial equipment 49

Electrical machinery ., . . . . . . . . . . 19

Total . . . . . . . . . 211

it

On the basis of fragmentary information,

was estimated that about 25,000 tons of

nickel in obsolete products were recycled in

1974. From the foregoing, losses of nickel

from the materials cycle in 1974 were estimated as follows:

Losses Thousands of tons

Unrecovered and unknown 86

Dissipative . . . . . . 53

Wear and corrosio n 6

End-product manufacture . 6

Alloying and mill product

manufacturin g 3

Domestic ferroalloy manufacturing 2

Tota l 156

SOURCE Working Papers One and Two
Ch. III—Quantification of Losses From the Materials Cycle 39

c.-

(J-J

(n

3

u.
40 ● Metal Losses and Conservation Options

m

c ma

m.

tnml

0 0

‘ml=

c+-

-Ln

v

.

.

.oc9co Ln-o

v- - -

. . . . .

. . . . . .

. . . . . .

. . . . . . — . .

.

.

.

,.

.

m.
Ch. III—Quantification of Losses From the Materials Cycle . 41

1-

Cci ‘1

0’)

0

L

z

m

0

3

1-
SUMMARY OF LOSSES FOR SELECTED METALS

A summary of the losses in physical terms

is shown in table 20. The losses are listed in

the sequence of materials flow—from mining through processing and manufacture

and then through usage and recycle. As indicated in table 20, the largest quantities of

losses in physical terms are those associated

with the high-volume basic materials—iron

and steel, aluminum, and copper. Quantities classified as unrecovered and unknown

are significant because of their size and

because they represent losses that one way

or another enter the environment in the

form of gaseous, liquid, or solid waste.

In order to develop a better perspective

on the various kinds of losses, table 21 gives

estimates of losses in percentage terms. In

each case, the losses are expressed as a percentage of domestic shipments of mill products of the metal. In other words, these percentages are expressed as a percentage of

the amount of metal flowing at one place, arbitrarily selected, in the cycle–shipments of

mill products.

As shown in table 21, the most significant

losses take place at the end of the materials

cycle (unrecovered material, postconsumer

waste, dissipative uses). If there are to be

substantial reductions in metal losses, techniques must be developed and implemented with emphasis placed on the end of

the materials cycle. The end of the material

cycle is important for another reason: for

each pound of material saved at the end of

the cycle, the accumulated losses associated

with the production and use of that pound of

metal are also saved. For example, referring

to the steel flow diagram in figure 13, 110.8

million tons of steel were embodied in production in 1974. Direct losses associated

with the production of that amount of steel

are 39 million tons of processing losses.

Thus for each pound of material in a product, 0.35 lb has been lost in reaching the

product stage. This means that 1 lb of metal

saved at the end of the cycle translates into a

total of 1.35 lbs saved.

Table 20.—Quantities Lost From the Materials Cycle of Selected Metals, 1974

Quantities lost from cycle

Iron and

steel Aluminum Copper Platinum Manganese Chromium Nickel Tungsten

(million (million (million (million (million (thousand (thousand (thousand

Nature of loss from cycle short tons) short tons) short tons) troy ounces) short tons) short tons) short tons) short tons)

Milling and concentrating . . . . . . . . .

Transportation and handlinga

. . . . . . .

Nonmetallic uses of raw materials.

Metal processing . . . . . . . . . . . . . . . .

End-product manufacture. . . . . . . . . .

Exports (net)

Mill products. . . . . . . . . . . . . . . . . . .

End products . . . . . . . . . . . . . . . . . .

Scrap. . . . . . . . . . . . . . . . . . . . . . . . .

Dissipative and quasidissipative uses

Corrosion and wear . . . . . . . . . . . . . . .

Postconsumer waste. . . . . . . . . . . . . .

Uncovered (and unknown). . . . . . . . . .

—.

23.3

(c)

Nom

d

6.8

1.1

(10.2)e

7.8

5.4

4.0

11.0

19.4

0.2

0.2

0.8

0.4

0.1

0.6

na

o

0 . 6

“ . ”

Nil

1.0

0.4

a These losses from the materials cycle are in nonmetallic form and low in

value. Such losses cannot be compared directly with other losses of metalIics later in the cycle.

bNil = amount of losses close to zero.

cIncluded in “metal processing Iosses.“

SOURCE Working Papers One and Two

0.4 Nil b0.012 0

. Nil 0.023 Nil

0.1 Nom 0.12 71

0.074 0.015 1.1 83

0.006 0.009 0.009 5

(0.1) (2.1) (0.1) o

na na na

o 0 0.05 o

“.s U.cd U.ud t Id

Nil 0.01 0.03 Nil

0.2 (h) 0.08 (

h

)

0.9 0.14 0.15 110 —— .

dNom = small but undetermined amount of losses.

e() = net imports.

f

na = data not obtained.

gIncluded in “dissipative losses “

hlncluded in ‘unrecovered and unknown losses.“

2.1 0.35

Nit Nil

Nom Nom

3 1.0

6 Nil

o 2.3

na na

o b

5s 1.9

(9)

(

h

) 2.1

86 2.5
Table 21.— Percentage Losses From the Materials Cycles of Selected Metals, 1974

Losses as a percentage of 1974 domestic shipments of contained metala

Nature of losses from cycle

Milling and concentrating . . . . . . . . .

Transportation and handlingb

. . . . . . .

Nonmetallic uses of raw materials.

Metal processing . . . . . . . . . . . . . . . .

End-product manufacture. . . . . . . . . .

Exports (net)

Mill products. . . . . . . . . . . . . . . . . . .

End products . . . . . . . . . . . . . . . . . .

Scrap . . . . . . . . . . . . . . . . . . . . . . . . .

Dissipative and quasidissipative uses

Corrosion and wear . . . . . . . . . . . . . . .

Postconsumer solid waste . . . . . . . . .

Unrecovered (and unknown) . . . . . . . .

. .

Iron and

steel

19

d

Nome

4

1

(8) I

nal

6

4

3

9

16

Aluminum

3

3

11

5

1

8

na

o

6

0

14

5

Copper

15

—

4

3

1

(4)

na

o

11

Nil

7

33

Platinum Manganese Chromium Nickel

NilC

1 Nil 1 –

Nil 3 Nil Nil

Nom 13 11 Nom

0.5 122f 12 1

0.3 1 1 3

0 11 0 0

na na na na

o 6 0 0

9 4 16 23

0.4 3 Nil 3

9 9 9 g

5 16 15 37

Tungsten

2

d

Nom

7

Nil

15

na

9

13

h

14

17

aAll losses are expressed as a percentage of 1974 domestic mill shipments of mill products containing the metal. For reference purposes, the total 1974 domestic mill

shipments for each metal were as follows, in millions of short tons Fe (124 3), Al (7.2), Cu (2 7), Pt (3 9 million troy ounces), Mn (O 9), Cr (O 724), NI (O 274), W (O 0148~

bThese losses from the materials cycle are in nonmetallic form and low in value Such losses cannot be compared directly with other losses of metallics later in the cy-

-,.

cle

c Nil = amount of losses close to zero

d Included in “metal processing Iosses“

eNom = small but undetermined amount of losses

fLosses of manganese exceed 100 percent because more manganese is lost as a slag in the Sseelmaklng process than iS contained in the steel products actually

shipped

glncluded in “unrecovered and unknown losses“

h Included in “dissipative losses“

1( ) = net Imports

Ina = data not obtained

SOURCE: Workinq Papers One and Two
* IV.

Identification of Technical Options

for Reducing Losses From the

Materials Cycle

.
Iv ■

Identification of Technical Options for

Reducing Losses From the Materials Cycle

This chapter reviews each of the loss categories discussed in chapter III in order to identify

techniques for reducing these losses.

UNRECOVERED AND UNKNOWN LOSSES

As shown in the flow charts (figures 13 to 20),

most industrial scrap is effectively recycled. On the

other hand, estimates of unrecovered and unknown losses range from 5 to 37 percent of shipments (table 21). Regardless of estimating errors

included in these figures, such losses are substantial. Figure 21 shows current levels of obsolete

scrap recycling as a percentage of 1974 mill shipments. The data is from figures 13 to 20. With the

exception of platinum, current recycling of obsolete scrap ranges from 5 to 26 percent. The potential for additional recycling is calculated as the sum

of the unrecovered materials and postconsumer

waste (from table 21), and ranges from 5 to 40 percent. However the extent to which this obsolete

scrap can actually be recovered is a matter of considerable controversy.

The Institute of Scrap Iron and Steel contends

that there is a large inventory of obsolete iron and

steel scrap that has accumulated over the years.

This view has been substantiated by two studies,

the most recent of which places the inventory at

over 600 million tons. ] On the other hand, some

economic studies indicate that this scrap may not

be available even with much higher scrap prices.2

In order to gather further information on this

question, the flow of obsolete products (and the

metals and other materials contained in them) to

their “final resting place” was evaluated for six

kinds of products (buildings, lathes, office equipI R~bert Nathan Associates, h’on and Stee/ SCrUp.’ [ts Ac -

cumulation and Aljai[abi’lifv as of .?1 December 19 7’S, prepared for The Metal Scrap Research and Education Foundation, August 1977.

~wi]l iam T, Hogan and Frank T. Koelble, Purchased Ferrous

Scrap: US. Dernund and SuppljI Oulkmk, Industrial Economics Research Institute, Fordham Universityr

, June 197’7,

Figure 21 .— Recycling of Obsolete Scrap

24

61

50

Al Cu Pt

;25;

25

Mn

22

Cr

4 6

23

NI w

51 potential recycling
48 . Metal Losses and Conservation Options

rapidly find their way to landfills even though they

bypass the municipal solid waste system. While

not completely conclusive because of the limited

range of products examined, the results do indicate

that the amount of obsolete scrap available for

recycling is smaller than previously calculated.

However, this only reinforces the need for additional recycling to prevent materials from being

lost forever.

The barriers to obsolete scrap recycling have

received detailed study.3 Obsolete scrap has a

limited market and competes with higher quality

virgin ore and industrial scrap that has a known

consistency and presents fewer collection difficulties. Options for increasing obsolete scrap recycling include: industry goal-setting, investment tax

credits, tax deductions for usage, product charges,

reduction of freight rate chages, and additional

research. Several of these options are included in

current energy legislation and have been studied

in detail in another OTA assessment.4

One final option is product rework and reuse.

Most obsolete scrap is available in the form of a

product. And as a product (with workable components), the scrap has more value than the metal

alone. The main reason that products are not reused is the lack of a well-established institutional

framework for collecting obsolete products and introducing them back into service in one form or

another. Product rework and reuse as a recycling

option are discussed in detail in chapter VI.

~Econ~mic and Technological Impediments TO Recycling

Obso/efe Ferrous So/id Was/e, NTIS report PB-223034, October 1973.

dMa[eria/s and Energy From Munici/)al waste (Washington,

D. C.: U.S. Congress, O-ffice of Technology Assessment, July

1 979), OTA-M-93.

LOSSES IN THE POSTCONSUMER SOLID WASTE STREAM

Postconsumer solid waste includes beverage all probability, there are substantial quantities of

and food containers, worn-out residential and com- other metals in postconsumer solid waste, roughly

mercial hardware, obsolete and worn-out small ap- in proportion to this general usage.

pliances, toys, sporting goods, automotive parts, Options for solid waste handling and resource etc. Such obsolete parts become a minor but significant part of the total refuse stream of kitchen recovery from the postconsumer solid waste

waste, paper, glass, and plastics. As shown in table stream are the subject of another OTA assessment,

21, large quantities of basic metals are in the and are therefore not discussed in this reports

postconsumer solid waste stream, representing 7

to 14 percent of domestic shipments of the metals

studied. The total ferrous content of solid wastes is 51,1s CoIlgreSS, office of Technology Assessment, ~alerials

about 11 million tons of iron and steel (which in-

. .

and Energy From Municipal Waste: Volume 11 Working

eludes manganese and other alloying elements). In Pape~, July 1978.

LOSSES IN DISSIPATIVE USES

Dissipative uses involve the dispersal of metals munitions. Similarly, uses of steel such as in reinand alloys by chemical action or physical disper- forcing bars or as nails are considered dissipative.

sion during use. For example, aluminum pig and

aluminum scrap are used in the deoxidation of As another example, large quantities of alloying

steel. The aluminum is lost as an oxide in the slag. elements are used at low levels in the production

Another dissipative use of aluminum is as a pow- of high-strength low-alloy steels. These steels with

der in the manufacture of aluminum paint or in low levels of alloy content are difficult to identify
Ch. IV—Identification of Technical Options for Reducing Losses From the Materials Cycle ● 49

and segregate from the ferrous scrap stream. As a

result, alloying elements such as chromium, nickel, and tungsten are diluted and lost in the normal

recycling of iron and steel scrap.

Referring to table 21, from 4 to 23 percent of the

domestic shipments of the selected metals is lost in

dissipative uses. A number of technical and economic barriers make it difficult to reduce this form

of waste. In cases where metals and alloys are dispersed by chemical action, performance and cost

considerations dictate their use over other materials and processes. For example, aluminum is used

in the deoxidation of steel because aluminum is a

reactive metal at the temperature of molten steel

LOSSES IN

Of the metals studied, none has a large net export. On the contrary, imports of metals are a major problem for domestic producers. A large

amount of material does leave the United States

through exports of fabricated products. However,

specific quantities are not known since data on imports and exports of fabricated products are available only in terms of dollars and number of items.

A detailed analysis would have to be made to

calculate the total metals contained in such products. As shown in table 21, a significant amount of

aluminum and manganese is lost from the domestic materials cycle through exports of iron and steel

scrap.

Losses through exports differ from other kinds

and is more effective and lower in cost than other

alternatives.

In cases where metals and alloys are physically

dispersed as nails, hairpins, etc., the costs of their

collection would be very high in relation to the

value of the metal they contain.

If there is to be conservation here, it will be

through the development of substitutes on a case

by case basis. Research and development on substitute materials and processes is underway and

would be accelerated by any threat to supply. However much of this work is uncoordinated and sporadic.

EXPORTS

of losses because

several years the

crease exports in

of foreign policy concerns. For

United States has needed to inorder to reduce an unfavorable

balance of payments. Further increases in exports

and imports are an integral part of U.S. foreign

policy and relations with all countries in the free

world. Any change in the pattern of exports, and

particularly through overt imposition of export

controls, would likely have severe political repercussions and invite counter restrictions. In addition, controls on fabricated product exports would

be a high price to pay for metal, since products on

the average have a value of from 2.5 to 5 times

their contained metal, During an emergency, however, this approach could be and has been used as

a materials conservation measure.

LOSSES IN MILLING AND CONCENTRATING OF ORES

After mining, ore is usually beneficiated before

smelting. Beneficiation involves milling of the raw

ore and processing to separate the desired mineral

from the rock associated with it. Although large

quantities may be lost in the milling and concentrating steps, the value of the material lost is low

and the cost of further recovery is high.

This report has focused on losses from the

domestic materials cycle. Any losses from milling

and concentrating in a foreign country are outside

of the domestic materials cycle and the scope of

this report. The low level of milling and concentrating losses for aluminum, platinum, manganese,

chromium, nickel, and tungsten reflects U.S. dependence on imported concentrates and semirefined products of these metals. In this case,

much of the waste occurs overseas.

With respect to beneficiation of iron and copper

ores, the level of losses is fixed by the technology
50 . Metal Losses and Conservation Options

and economics of processing taconite (iron ore

containing about 25 percent iron) and low-grade

copper ores (containing 0.4 to 0.8 percent copper).

Presently available technology cannot significantly

reduce the losses shown in table 21. In addition,

processing of lower grade ores incurs increasing

energy and environmental costs.

One obvious option is to increase imports of

high-grade ore concentrate. Higher grade deposits

of iron ore and many other metals are available

outside the boundaries of the United States. But increasing U.S. dependence on imports raises serious questions about the amount of risk associated

with dependence on foreign supplies. This must be

balanced against the increased costs of energy and

environmental controls that would be required in

domestic processing of lower grade ores.

Another option for reducing losses during milling and concentrating is to invest in a major R&D

program directed toward increased recovery of

metal values from low-grade ores. Most experts in

the field point to the need for research in fineparticle separation, since a considerable portion of

the losses during milling and concentrating are in

the form of fine particles and slimes. A major advance in fine-particle technology might bring

about significantly increased recovery rates and

reduced losses. In this way, a higher proportion of

the mineral values in the ground might be economically converted to usable concentrates.

LOSSES IN METAL PROCESSING

The metal-processing stage of the materials cycle includes smelting, refining, and producing mill

products. These operations are generally capitalintensive. As shown in table 21, losses in metal

processing range from less than 1 to 12 percent of

domestic shipments of the selected metals—except

for manganese. The use of manganese in steelmaking is unique. A substantial portion of the

manganese functions as a reagent in removing

oxygen and in controlling sulfur in steel.

The major barriers to waste reduction in the

processing of metals are technological and economic. Current technology is the average technology of all plants in operation. Average technology

shows improvement only as new plants with new

technology are brought online and old plants with

old technology are either upgraded or dismantled.

Substantial time and financing are required to turn

over the capital stock in any of these basic material

industries.

Besides capital replacement using new technology, few options are available for making a significant reduction in the losses associated with metal

processing. One exception is the use of alternatives to manganese for controlling sulfur in steelmaking. Materials such as magnesium and calcium

carbide can be used in external desulfurization

processes. The economics of alternative desulfurization processes depend on many technical factors

and the availability and cost of manganese. Thus

far, manganese has a clear-cut cost advantage over

available alternatives. Nonetheless, significant

changes in availability of manganese and or costs

of the alternatives could change this picture.

LOSSES IN END-PRODUCT MANUFACTURE

The losses in end-product manufacture for the losses are associated with literally hundreds of difselected metals range from less than 1 to 3 percent ferent types of fabrication processes. Since the

of domestic shipments of mill products. These rela- losses are so small, opportunities for conservation

tively low levels of loss occur as metals are fabri- are limited to marginal improvements in managecated into end products, such as automobiles, ap- ment controls over the manufacturing process.

pliances, electrical equipment, and buildings. The
Ch. IV—Identification of Technical Options for Reducing Losses from the Materials Cycle ● 51

LOSSES IN CORROSION AND WEAR

As indicated in table 21, losses of material

directly associated with corrosion and wear are

generally small and range from essentially O to 3

percent of domestic mill shipments. These are

direct losses from corrosion and wear and do not

include indirect losses from the effects of corrosion

and wear on product life, which are discussed in

chapter V. Thus, promoting improved corrosion

and wear resistance is not an efficient way to reduce material losses, but there can be substantial

economic benefits through improvements in reliability, durability, and performance.6 In addition,

as is shown later, the development of improved

corrosion and wear resistant treatments can be

used to build a great deal of flexibility into materials usage.

6L. H. Bennett, Econ{)rnic Effects of Metallic Cor~c).si(m ir) the

Uniled States, A Report to the Congress, National Bureau of

Standards, March 1978.

LOSSES IN NONMETALLIC USES OF RAW MATERIALS

The nonmetallic use of raw materials varies sub- would not receive separate consideration except

stantially. Significant quantities of aluminum, for the fact that many of such uses are dissipative.

chromium, and manganese raw materials are used Because of this, the same options for reducing

in ceramics, abrasives, refractories, and chemicals. losses would apply to nonmetallic uses as would

These are generally accepted uses of metals and apply to dissipative uses.

SUMMARY OF TECHNICAL OPTIONS

The technical options that have the greatest leverage in reducing each category of loss are shown

in figure 22. The most highly leveraged options are

scrap and metal recycling, R&D on substitute materials and/or processes, and R&D on metal recovery from low-grade ores.

Metal recycling and product remanufacturing

have multiple leverage because, in addition to the

direct reduction in losses of unrecovered metals in

obsolete products, these options lead to an additional savings in future years. For example, if

through product recycling an additional 10 percent

of obsolete office equipment in a given year is

remanufactured, 10 percent less metal will be required for next year’s production run (assuming

constant demand). This will also eliminate the

losses (e.g., milling and concentrating) that would

have been associated with producing that amount

of metal.
52 “ Metal Losses and Conservation Options

Figure 22.—Technical Options for Reducing Losses in

the Materials Cycle

L O Ss category

Unrecovered metals

Dissipative uses

Milling 8 concentrating

Exports of scrap& milt

products

Postconsumer solid waste

Metal processing

Nonmetallic uses of raw

materials

End-product manufacture

Corrosion and wear

Transportation & handling

Range of losses”

5.14%

0.5”12%

(Mn=122%)

Wrn-11 %

Nit-3%

Nil-3%

Nil-3%

Technical conservation option

-.

Metal recycling

Product remanufacturing and reuse

R&D on substitute materials

and/or processes

R&D on metal recovery from

low-grade ores, e.g. fine particle

technology

Export controls

Productr recycling

Capital replacement

Alternative desulfurization process

(for Manganese)

R&D on substitute metals

& processes

Improved management controls

R&D on improved corrosion and

wear resistant treatments

Improved management controls

● Range of losses for the eight metals in percent of 1974 domestic mill shipments

See figure 3 and tables 20 and 21 in chapter III for metal specific data

Nom = small but undetermined amount of losses.

Nil = amount of losses close t o zero.

SOURCE: OTA based in part on data from Working Papers One and Two
v ■

Design Review of Technical Options

for Reducing Excess Material in the Cycle
v.

Design Review of Technical Options

for Reducing Excess Material in the Cycle

METHODOLOGY

The second major class of waste is the use of excess materials in the materials cycle. This chapter

identifies technical options for reducing materials

usage in the design, manufacture, and use of products.

Table 22 presents a list of options grouped in six

basic classes or categories:

● use of less metal in products,

● substitution for critical metals,

. product rework and reuse,

● extended design life and durability,

● reduced inventories and overproduction, and

Table 22.—Options for Materials Conservation

in Product Design, Manufacturing, and Use

Use of less metal

● Reduce size

● Stress optimization

c Better manufacturing techniques

. Eliminate unessential components

. Functional changes in product

● Standardization of components

s Design for recycle

. Decreased scrap generation

● Powder metallurgy manufacture

Substitution for critical materials

● Use of less critical materials

● Use of renewable resources

. Recyclable materials for nonrecyclable

Extended life through rework and reuse

● Product rework

. Reuse of components

. Remanufacture of components

Extended design life and durability

● Reduced obsolescence

. Failure avoidance

● I reproved maintenance procedures

c I reproved corrosion and wear resistance

Reduced inventories and production

● Combined inventories

. Production control

Use of less-intensive materials systems

and products

● Use of coatings for alloys

. Reduction of alloy content

s Combined usage of products

● use of less intensive materials systems and

products.

These are technical options that, if implemented, would reduce metal usage. The list does

not include implementation options such as education, increased R&D, and regulations, which could

be used as a means of implementing a given technical option. Implementation options are considered in chapter VII.

The overall approach of this chapter’s analysis is

shown in figure 23. For selected products, the potential material saving for each option was estimated by conducting a design review. The design

review was carried out on a product-by-product

and component-by-component basis for each of

the eight metals studied in chapter IV.

Figure 23.— Methodology for Evaluating Options for

Reducing Excess Material in the Cycle

Select products as case examples

1

Select detailed options to

reduce usage of the

eight selected metals

* v +

Quantify material-saving potential

for each option, each metal,

and each product I

I

k? Choose major metal-saving option

I

Generalize materials savings

by applying results from case

examples to major product

uses of each metal

Identify impediments

to applying these approaches

SOURCE: OTA, based on Working Paper Three SOURCE: OTA

55

51-680 0 - 79 - 5
56 ● Metal Losses and Conservation Options

Estimated material savings were then generalized to a whole range of products that contained

the metals under evaluation. For example, if 10

percent of steel used in automobiles could be

saved by a stress-optimized design, that percentage

was applied to all transportation products containing a given amount of steel.

Because of the great variety of products and the

large variations in material usage in each product,

only a few products could be selected for review of

their design, manufacture, usage, and disposal.

The products are listed in table 23. These products

Table 23.—Products Selected as Case Examples

Industry Product

Transportation . . . . . . . . . . . . . . . . . . . . . . . Automobile

Appliances. . . . . . . . . . . . . . . . . . . . . . . . . . . Refrigerator

Construction. . . . . . . . . . . . . . . . . . . . . . . . . Buildings

Bridges

Machinery . . . . . . . . . . . . . . . . . . . . . . . . . . . Lathes

Tractors

Fabricated metal products. . . . . . . . . . . . . . Cans

SOURCE: OTA.

were selected because they are typical of the specific industries indicated and because each product

uses a relatively large amount of metal.

DESIGN REVIEW OF SELECTED PRODUCTS

In order to quantify the amount of material that

could be saved using the technical options listed in

table 22, a design review of each of the products

listed in table 23 was carried out. The details of the

methodology are described in the Working Papers

(vol. II-C); an example of the methodology for refrigeration is given in chapter VI. Basically, each

product and component were reviewed for alternative designs that would use less metal. The metal

savings would be the difference in metal usage between the present and the proposed design.

The potential metal savings of every option is

shown by product in table 24, The numbers in the

table represent the percentage of the total weight

of the product that could be saved or substituted

for. For substitution options, the numbers represent the percentage saved of the second metal by

substituting the first. A hyphen (dashed line) in the

table indicates the savings are small but that no

quantitative estimate has been made. NA indicates

an option is not applicable to the product.

These numbers are engineering judgments of

the overall conservation potential for the listed options. The numbers are interdependent in that implementation of one option will reduce the saving

possible with another option. Also, the percentages shown indicate the savings that are technically possible. Economic and other factors may

severely limit the actual savings. Finally, the purpose of these numbers is only to identify the most

promising options, not the practicalities of implementation.

As shown in table 24, the potential metal savings are generally small for options that would use

less metal. Removing excess metal through improved manufacturing techniques shows significant potential for metal cans, but not for other

products. Stress optimization or “design to stress”

is generally applicable and could save up to 30 percent of the metal depending c n the product. Other

options save insignificant amounts of metal either

because they represent the current practice or

because they cannot be implemented. Design for

recycling is not an effective strategy at present

because it is not the design that limits the recycling, but rather ineffective methods of disposal

and metal separation. This situation may improve

in the future, but the net effect on material savings

cannot be ascertained at this time (as indicated by

an “X” in table 24).

Initially, standardization of components appeared to be a desirable option for saving metal

through a reduction of inventory. However, this investigation showed that standardization could lead

to increased, rather than decreased, use of metals

because all components would have to be designed for the maximum usage condition. To be effective, standardization would have to be combined with component recycling so that the built-in

excess durability could be fully utilized.

Substitution as a general option has the widest

applicability and offers the largest potential savings. A substitution of one metal for another does

not reduce the overall use of metal nor would substitution be an effective option if all materials, in-
Ch. V—Design Review of Technical Options for Reducing Excess Material in the Cycle ● 57

--

Table 24.—Potential Metal Savings of Conservation Options for Selected Products

Product

Fabricated

Cans and metal

Cars Refrigerators Tractors Lathes containers structures

-. — —

Use of less metal

Reduce size . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Better manufacturing techniques . . . . . . . . . . . . . .

Stress optimization . . . . . . . . . . . . . . . . . . . . . . . . . .

Eliminate unessential components. . . . . . . . . . . . .

Functional change. . . . . . . . . . . . . . . . . . . . . . . . . . .

Standardization of components. . . . . . . . . . . . . . . .

Design for recycle . . . . . . . . . . . . . . . . . . . . . . . . . . .

Decrease scrap in manufacturing . . . . . . . . . . . . . .

Powder metallurgy. . . . . . . . . . . . . . . . . . . . . . . . . . .

Product recycling

Product rework. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Reuse of products or components . . . . . . . . . . . . .

Remanufacture of components . . . . . . . . . . . . . . . .

3-45 10 1

1-6 < 1 2

5-16 30 2

< 1 — —

< 1 — —

< 1 — —

< 1 x —

2 1-2 < 1

3-5 1-2 < 1

NA

8

8

—

1-2

1-2

NA

{ }

23-33

NA

—

NA

x

—

100

NA

NA

NA

—

10

x

—

15 80 NA NA NA NA

NA NA NA NA 0-80 10-80

15 1 50 5 NA NA

Substitution’

Al/steel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68 74 < 1 2 100 40

Plastic/steel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17-20 31-85 <1 2 40 NA

Al/Cu . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 100 100 100 100 NA 100

HSLA/St . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 NA 2 1 NA 30

Steel/Al . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 100 75 NA NA 100 100

Wood/steel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . NA NA NA NA NA < 3 0

Concrete/steel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . NA NA NA 50 NA < 3 0

Composites . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0-90 0-84 <1 4 NA NA

Glass/St . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . NA NA NA NA 40 NA

Glass/Al . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . NA NA NA NA 91 NA

Lead/steel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . NA NA 30 NA NA NA

Plastic/Al . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . NA NA NA NA 91 NA

Increase product life

Increase component life . . . . . . . . . . . . . . . . . . . . . . 50-60 60 3 3 NA —

Numbers indicate percentage of metal, by weight, that could be saved for each option and product studied A dash means negligible metal could be saved. NA means that

option is nonapplicable X means savings cannot be determined at thls time

.The substitutions should be interpreted as follows, for example

Al/steel = substitution of aluminum for steel.

Al/Cu = substitution of aluminum for copper

HSLA/St = substitution of high-strength Iow-alloy steel for steel.

SOURCE: Working Paper Three.

eluding plastics, were in short supply. However,

where a supply crisis develops with a particular

metal (or material), substitution would be the most

effective option if there were sufficient time to implement it.

Product recycling appears to be an effective option. A product reaching the end of its life (as defined by its owner) maybe returned to useful life in

a variety of ways. It may be used again in its current state (reuse). Either the whole product or its

individual components can be repaired, reworked,

or remanufactured. Repaired means that the product is made operable. Reworked means that the

product is returned to its orginal state or close to it

by adding new parts, repairing parts, painting, etc.

(overhaul). Remanufacture means essentially the

same thing as rework except that in remanufacturing the original parts are not reassembled (see

glossary, appendix D).

Product rework appears to be technically possible for most products except cans (which only have

one life) and structures. The potential of this option

is limited for automobiles since most of the automobile is now effectively recycled, but would

amount to about 80 percent (the same as refrigerators) if this were not the case. The rework option
58 ● Metal Losses and Conservation Options

does not apply to tractors and equipment that are

already used almost to the limit of their useful

lives.

Reuse of products or components offers some

potential savings for containers and fabricated

metal structures. The amount of metal saved

would depend on the amount of metal used. Finally, remanufacturing of components is already extensively used for automobiles and could be applied to a wide variety of other products.

Increasing product life by increasing the lifetime

of life-limiting components would save considerable metal, but only for certain products. A more

detailed analysis is necessary to determine if

enough products are involved to realize a substantial savings.

In sum, based on these selected products, the

technical options that offer the greatest potential

for saving metal are the following:

●

9

●

●

substitution,

stress-optimized designs,

rework and reuse of products and components, and

extended product life.

The following section presents estimates of the

total savings possible if each of these options was

applied to all products, not just the ones listed in

table 24.

In table 25, the results from the specific case examples presented in table 24 are generalized to the

industry as a whole. The numbers in table 25 are

the percent of 1974 domestic shipments that could

be saved by each option listed. The detailed methodology used to develop these percentages is described in volume II-C of the Working Papers. In

brief, the percentages derived for the individual

products were applied to all o the products within

a given industry.

More specifically, the flows of materials were disaggregate into all major end-use products for each

of the eight selected metals. Then each of the enduse products was placed in one of the following

categories:

●

●

●

●

●

●

●

●

transportation,

electrical equipment,

building and construction,

industrial machinery and equipment,

off-the-road equipment,

commercial equipment,

domestic equipment, and

cans and containers.

Based on the data from table 24 and engineering

judgments as to their applicability, the following

metal-saving percentages were applied to the enduse products in each category.

1. For substitution, metal savings ranged from 2

to 100 percent with the following rough

breakdown: (variations were also made on a

metal-by-metal basis)

●

●

●

●

●

●

●

2 percent for metalworking and manufacturing equipment;

10 percent for tractors and related machinery;

40 to 100 percent for building and construction materials;

40 percent for electrical machinery;

70 percent for appliances;

70 to 100 percent for automotive; and

100 percent for containers.

2. For using less metals, both manufacturing

techniques and stress optimization were conTable 25.—Potential Metal Savings of Conservation Optionsa

Substitution Increase Reuse of

in construction Use of product Remanufacture products or Product

Metal Substitution industry b

less metalclife of components components rework

Aluminum. . . . . . . . . . . . . . . 60 6 8 5 1 15 30

Copper . . . . . . . . . . . . . . . . . 59 23 6 6 4 32

Iron and steel . . . . . . . . . . . . 29 6 9 8 3 11 30

Chromium. . . . . . . . . . . . . . . 16 — 4 5 2 6 12

Nickel . . . . . . . . . . . . . . . . . . 20 — 8 9 2 15 12

aNumbers indicate percent of total 1974 end use of each metal, generalized from product to industry.

bIncluded in substitution.

CBy better manufacturing techniques and stress optimization.

SOURCE: OTA, based on Working Paper Three.
Ch. V—Design Review of Technical Options for Reducing Excess Material in the Cycle . 59

sidered together. Where appropriate, the

following numerical values were applied:

● 8 percent for machinery and manufacturing equipment;

● 10 percent for electrical machinery; and

s 10 to 20 percent for appliances, construction, containers, and automotive.

3. For increased product life, computations were

carried out as follows: A factor of 50 percent

was applied to automobiles, some appliances,

household products, domestic and office furniture, and air-conditioners. Three percent

was applied to some industrial equipment.

4. For remanufacture of components:

15 percent for automotive, appliances,

watches, clocks, motors, generators, transformers, and air-conditioners;

50 percent for locomotives, tractors, and

agricultural machinery; and

● 5 percent for industrial materials-handling

equipment.

5. For reuse of products and components:

●

●

●

For

50 to 80 percent for architectural products

such as windows, doors, screens, awnings,

canopies, plumbing, and other builders’

hardware; reusable containers such as barrels, pails, domestic and office furniture;

wire and cable;

10 percent for limited other categories such

as cabinet sheet stock; and

The percentages shown for product rework

were based on an independent study of the

products for which rework was made possible and a determination of the amount of

metal contained in these products.

each technical option and metal, the total

potential metal savings as a percentage of end

usage is given in table 25.
VI.

Analysis of the Most Significant

Technical Options for Reducing

Excess Metals Use
VI m

Analysis of the Most Significant

Technical Options for Reducing

Excess Metals Use

Based on the design review in chapter V, the most significant technical options in terms of

potential metal savings as a percent of domestic shipments are listed below:

● substitution (16 to 60 percent),

● product rework (12 to 43 percent),

● product reuse (6 to 32 percent),

● substitution in construction (O to 23 percent),

● eliminate unnecessary metal (4 to 9 percent),

● increase product life (5 to 9 percent), and

● component remanufacture (1 to 4 percent).

All of these options are discussed in more detail in this chapter, along with one general option

not included in the design study (reduced use of materials-intensive systems). Particular attention is

given to identifying the impediments or barriers to implementation of the technical options.

SUBSTITUTION

In theory, substitutes of one material for another

are easily made, in a variety of ways, to cope with

supply shortages. In practice, however, it is much

more difficult; substitutes are not always available.

[n product design, materials are selected based on

a wide variety of criteria and specifications such as:

strength, corrosion resistance, fatigue resistance,

thermal expansion to match mating parts, damping capacity, strength to weight ratio, wear resistance, dimensional stability, modulus of elasticity,

weldability, appearance, and, of course, cost. Thus,

the selection of materials is always a compromise

among a number of factors, and the necessity to

substitute may make the product design inadequate or the product itself uncompetitive. Secondly, substitutes may not be available when needed;

substitutions can take many years to implement,

often longer than the duration of the shortage.

For these reasons, new product substitutions are

relatively straightforward compared with the complexities of substitution for products already designed and in production.

The ease of making substitutions depends primarily on the type of production. Some products

are made to order by assembling purchased materials and components (e.g., home construction).

Under these circumstances, materials substitutions

can be made with relative ease. To make a component from plastic instead of metal means selecting

a different subcontractor who has the appropriate

production equipment. Other products (e.g.,

lamps) are made with general production equipment (lathes, drill presses, etc.), which is either

adaptable to various metals or is relatively inexpensive and can be changed as the need arises.

However, with many mass-produced products

(e.g., autos, refrigerators) all the input elements, including materials, are optimized, and very specialized equipment is utilized.

Here, the material used is integral with the production method, including the form in which the

metal is purchased (sheet, wire, powders, etc.) and

the method of scrap salvage. In most cases, the

particular talents of the labor force (welders, grinders, etc.) are also integrated with the materials and

methods of production, and material changes are

therefore expensive and slow to implement.

For example, a new engine or a new transmission in an automobile might require capital invest63
64 ● Metal Losses and Conservation Options

ments of $200 million to $500 million, a new body Thus, if substitution is to be considered a workshell from $100 million to $500 million, and a new able alternative, greater flexibility must be built

car between $500 million and $900 million. Just into the production process. Secondly, a new subchanging a single component can run into millions stitution involves a risk that will add to the product

of dollars. One automobile manufacturer reports cost, even if no problems develop. Strong financial

that the introduction of a plastic tailgate would incentives will be required to speed up the substialone cost $300,000. Even if accepted and intro- tution process.

duced into limited production in 1979, the plastic

tailgate would not be in full production until 1990.

PRODUCT RECYCLING (PRODUCT REWORK AND REUSE,

COMPONENT REMANUFACTURE)

Product and part recycling may be viewed on a

continuum ranging from full-scale remanufacturing to minor repair at the consumer level. In all instances, the life of the product is extended by

bringing it back up to some useful functioning

level of performance. An additional category “reuse” might be added to this continuum to imply

reuse without any repair, refurbishing, or remanufacturing effort applied to the product or part. The

returnable container is an example of product

reuse.

Product remanufacturing is a process in which

reasonably large quantities of similar products are

brought into a central facility and disassembled.

Parts from a specific product are collected by part

type, cleaned, and inspected for possible repair

and reuse. Products are then reassembled, usually

on an assembly-line basis, using recovered parts

and new parts where necessary. Product remanufacturing is a rather high-volume factory arrangement similar to new product manufacturing, except that the parts flowing to assembly lines are

mostly reconditioned parts.

Product rework is a process where products are

usually also brought back to some central facility

for processing. However, on disassembly a product’s component parts are kept together and after

cleaning, inspecting, and replacing with new parts

where necessary, the original product is reassembled with most of its original parts. Rework (also

known as “refurbishing” or “reconditioning”) is

not as amenable to mass-production methods as is

remanufacturing.

Lack of recycling of obsolete products does represent a major metal loss. Quality, cost, and other

barriers have limited metal recycling. As a result,

the use of obsolete scrap has increased only marginally during the past 20 years. Component and

product recycling is a possible alternative that offers several distinct advantages over metal recycling.

Product recycling and reuse does have considerable potential to save metal, and it can be applied

to a wide range of products. Indeed, product recycling is already taking place in a variety of forms.

For example, automobile parts are extensively reworked and reused; aircraft are reworked on a

periodic basis; some construction firms separate

and reuse building components; and certain consumer durables like refrigerators are reworked and

sold overseas.

In this assessment, a review was made of a variety of products that are currently recycled in order

to determine if any common elements of successful recycling existed. The results are outlined in

the following paragraphs:

1 Trucks: Several companies rebuild and sell

trucks, and there is a strong demand for such

vehicles. For automobiles, recycling is done

only by the military and certain fleet owners.

Product recycling is not practical for most

autos because of the detail work that must be

done (trim, upholstery, etc.) to restore the appearance to a level acceptable to the customer. In any case, an effective recycling system

already exists. A major portion of the income

of auto wreckers is from parts salvaged from
Ch. VI—Analys\s of the Most Significant Technical Options for Reducing Excess Metals Use ● 65

vehicles of all ages. Auto wreckers know the

market for salvaged parts, and delay the final

scrapping of auto hulks until the valuable

parts have been removed. One of the markets

for components, including engines and transmissions, is remanufacture of such components. The institutional problems and relationships in automobile manufacture, repair,

and components salvaging make it difficult

for any one institution to develop assured

supplies and management control over all

operations.

2. Copying Equipment: One of the major

3.

4.

manufacturers of copying equipment has established a components and products salvage

and remanufacturing operation for its main

lines of copiers. In this case, the supplies of

components and products and management

control are all within one institution. This is

because copying equipment is not sold but instead is leased and therefore remains under

the control of the manufacturer. In this case,

sophisticated diagnostic tools and high-technology repair facilities can be developed. All

service and parts are the responsibility of, and

in the control of, the manufacturer. As a result, the manufacturer has a better knowledge

of service problems and is able to modify the

design so that products are returned in better

condition. The manufacturer can also modify

the design to make the product easier to recycle.

Off-the-Road Equipment: One of the major

producers of off-the-road equipment has a

similar program of component salvage and remanufacture. Unlike copying equipment,

most off-the-road equipment is sold to the

user, and maintenance is the responsibility of

the user. The off-the-road manufacturer has

discovered that he can provide a valuable

customer service in the form of a component

salvage and rework operation. This service is

provided at lower cost than could be achieved

with new parts and components.

Typewriters: Extensive recycling of the IBM

electric model C typewriter is carried out,

both by private industry and by the Government. The General Services Administration

5.

(GSA) maintains a repair facility that repairs

and reworks the IBM model C. Typewriters

are collected during the repair process. The

cost of rework is one man-day of labor plus

miscellaneous parts cost. These typewriters

are then resold to Government agencies at

about one-half the cost of a new typewriter.

The ingredients of success include: an existing collection pipeline, favorable economics

of repair, and most important, a popular product. GSA rebuilds only this model because of

the large volume and high demand. Rework

is not done for other typewriters, which instead are sold as is or for scrap.

Aircraft: Aircraft are extensively refurbished. A study of the costs of rework for one

military aircraft showed that a $6 million

plane could be reworked for $120,000. However, this was done on a production-line basis

with a well-developed system of parts inspection, inventory, and control. Each part is reworked in a prescribed manner and on a prescribed schedule.

Some examples of other recycled products include:

● machine tools,

● mattresses,

● diesel engines,

● auto bumpers,

● furniture,

● motors, and

● air-conditioning compressors.

From these examples, it can be seen that the

major ingredient of success is the existence of a

“pipeline” for pickup and resale where a close relationship has been established between repair or

leasing facilities. Where appearance or style is important, the trend seems to be to salvage the parts

and scrap the body of the product. To achieve

economies of scale, it appears to be essential to use

production-line methodology. Products reworked

on a one-by-one basis are almost always more costly than the new models. Very complicated products with many features are also difficult to recycle.

The major barrier to more widespread product recycling is economic. To be economically attractive,

used products must be reworked or remanufactured at a cost that will allow a resale price at a rea-
66 ● Metal Losses and Conservation Options

sonable discount over the price of the new product. Products for which recycling is most likely to

be economic are those with large volume, where

appearance or styling is not a problem, and which

can be recycled on a production-line basis. For

those products where recycling is economically

sound, the major barrier is the lack of established

industries to recycle that product.

Another impediment is the consumer’s desire

for new products. This barrier was identified in a

survey of consumers carried out by Corm where

“25 percent of the respondents disposed of their

products because they preferred new ones.”1 This

consumer behavior pattern is in part encouraged

by Government regulations that require the labeling of recycled products.

In order to better understand the product disposal pipeline, patterns of disposal were identified

~wi Da\,id Corm, FaCIOr.y Affectinq Product Lifetime, NSF/

RA Report 780219, August 1978. ‘

for selected representative products in widely

separated geographic areas (see Working Paper

Four, vol. II-D, for details). The products covered in

this part of the study include buildings, lathes, office equipment, pipelines, refrigerators, and television sets. The cities selected were: Ashland,

Ohio; Dodge City, Kans.; Knoxville, Term.; Pittsburgh, Pa.; and Phoenix, Ariz.

A typical disposal pattern for refrigerators is

shown in figure 24. A summary of the results of

this investigation for each of four products and four

locations is shown in table 26. The patterns of

disposal are very similar with a few exceptions.

The major finding is that most of these products

when discarded do not go directly to landfills but

are first collected or traded in. An effective collection pipeline already exists. Unfortunately, remanufacturing facilities do not exist. This prevents the

effective rework and reuse of used products and

components.

Figure 24.—Typical Disposal Pattern for Refrigerators

I

.

P c

SOURCE Working Paper Four
Ch. VI—Analysis of the Most Significant Technical Options for Reducing Excess Metals Use ● 67

Table 26.—Disposal Patterns of Selected Products in Percent of Total Disposals

SOURCE Working Paper Four

SUBSTITUTION IN THE CONSTRUCTION INDUSTRY

Of the industrial sectors that account for much

of the metal usage (construction, transportation,

machinery, appliances, and electrical), the construction industry is the most flexible. At almost

any time during the construction process, metal

and nonmetal substitutions can be made for any

given component. Tables 27, 28, and 29 show the

substitutions possible for aluminum, copper, and

steel, respectively. The potential material savings

are 6 to 23 percent, as shown earlier in table 25.

These numbers are quite large, given that only one

option and one industry are involved.

In order to get an estimate of the cost of this saving, the construction cost of a 40-story office building was estimated with and without reduced metal

usage. For this building, all uses of metal were

reviewed and cost estimates for reasonable substitutes were prepared. This data is shown in table

30. The building with reduced metal costs about

$14.5 million less than the total cost of $60 million

without substitution, and would save 4,020 tons of

steel. The only questionable item in this saving is

the sprinkler system that would have to be demonstrated to be fireproof. Thus, the economics of construction are in favor of using less metal. However,

other factors work against substitution in the construction industry, such as the lack of necessary

labor skills and customer preferences for traditional building materials.

ELIMINATE UNNECESSARY METAL IN PRODUCTS

As shown in table 25, the elimination of excess 70 lbs in the shell, 16 lbs in the door

metal in products might save between 5 and 10 the inner liner for a total of 135 lbs.

and 49 lbs in

percent of metal consumption. In order to determine whether this could be realized in practice at a

reasonable cost, a detailed analysis was made of

the metal uses in a variety of products and the

potential for conservation. A summary of the results for refrigerators is presented below to illustrate the problems involved.

The typical metal usage in a refrigerator is

shown in table 31. [t consists of 161 lbs of steel, 12

lbs of aluminum, 6 lbs of copper, and 0.5 lb of

chromium for a total of 179.5 lbs of metal. A majority of the metal is in the box, which consists of

If the refrigerator sides and top are made of steel

with holes cut in the sheet and covered with a

flame-retardant plastic, a considerable weight savings will be realized. An estimated 11 lbs of steel

could be saved of the 70 lbs now used. However,

this metal savings results in manufacturing and

cost penalties. First of all, a manufacturer estimates that this would add $30 to the cost of making the refrigerator, including the cost of the plastic, the adhesives, and some method of finishing

the edges. Also, the use of plastic on the exterior

poses a moisture and flammability problem. In ad-
68 ● Metal Losses and Conservation Options

Table 27.—Opportunities for Saving Aluminum in the Construction Industry

Fiberglass

HSLA

Reinforced

concrete

Steel

Wood

Wood/coating

Surface

coatings

—

●

●

✎

●

●

●

●

●

●

●

●

●

●

●

●

●

●

●

●

●

● ●

●

●

●

●

●

●

s

c

●

●

●

●

●

●

●

●

●

—

●

SOURCE” Working Paper Three

Table 28.—Opportunities for Saving Copper in the Construction Industry

Steel

Wood

Wood/coating

Fiberglass

Aluminum

Plastics

●

●

●

●

SOURCE: Working Paper Three.
Ch. VI—Analysis of the Most Significant Technical Options for Reducing Excess Metals Use ● 69

Table 29.—Opportunities for Saving Steel in the Construction Industry

Aluminum

Copper

Fiberglass

HSLA

Plastics

Reinforced

concrete

Wood

Wood/coating

●

●

●

●

●

●

●

●

●

●

●

—

●

SOURCE Working Paper Three

Table 30.—Construction Cost Estimates for a Metal-Free Building*

Building component

Structure . . . . . . . . . . . . . . . . .

Skin . . . . . . . . . . . . . . . . . . . .

Ductwork. . . . . . . . . . . . . . . . .

Plumbing. , ... , ... , . . . . . . .

Sprinkler . . . . . . . . . . . . . . . . .

Electrical . . . . . . . . . . . . . . . . .

Curtain walls. . . . . . . . . . . . . .

Metal saved

(Fe) 2,117 tons

(Fe) 200 tons

(Fe) 1,300 tons

(Cu) 3 tons

(Fe) 16 tons

(Fe) 125 tons

(Fe) 18 tons

(Fe) 1,100 tons

Substitute

Reinforced concrete

(706 tons steel used)

Sand-blasted concrete

(20 tons steel used)

Plastics (130 tons steel)

Plastics

Plastics

Fiberglass

Block wall

Savings

($1,903,293)

14,041,963

1,587,500

391,420

406,250

—

—

Total. . . . . . . . . . . . . . . . . (Fe) 4,876 tons 856 tons steel

Net savings . . . . . . . . . . . (Fe)4,020).tons $14,523,840

. Forty stories, 1.3 million ft2 of floor space, total cost of $60 million without substitution.

SOURCE: OTA, based on Working Paper Three

dition, plastics do not age as well as steel. The other applications), but, that something else must

manufacturing process would be somewhat more be added to take its place. This would probably be

complicated since the steel would have to be han- true for any application where the metal is used for

died in the conventional way. Then, instead of “containment .“

enameling or coating in a single process, the plastic would have to be attached by hand. Thus, the If the refrigerator sides are made of thinner steel

primary barriers to the use of less steel are the in- (0.010 inch) and ribs are added to bring the stiffcreased manufacturing cost and the uncertainty of ness up to the original level, approximately 58 lbs

the results. The increased cost results from the fact of steel can be saved. The cost of the material

that metal is not just removed (as it could be in saved would be $10.88. This would be counterbal-
70 “ Metal Losses and Conservation Options

Table 31 .—Summary of Refrigerator

Materials Content

Material

Steel

Copper

Aluminum

Chromium

Total

Part

Total. . . . . . . . . . . . . . . . . . . . . . . . .

Outer shell without door . . . . . . . .

Door only. . . . . . . . . . . . . . . . . . . . .

Inner foodliner. . . . . . . . . . . . . . . . .

Compressor shell . . . . . . . . . . . . . .

Other compressor parts. . . . . . . .

Condenser. . . . . . . . . . . . . . . . . . . .

Shelving. . . . . . . . . . . . . . . . . . . . . .

Total . . . . . . . . . . . . . . . . . . . . . . . . .

Condenser (coating) . . . . . . . . . . . .

Tubing for interconnections . . . . .

Motor and wiring. . . . . . . . . . . . . . .

Total . . . . . . . . . . . . . . . . . . . . . . . . .

Compressor and motor

Compressor. . . . . . . . . . . . . . . . .

Motor . . . . . . . . . . . . . . . . . . . . . .

Evaporator. . . . . . . . . . . . . . . . . . . .

Handles and trim. . . . . . . . . . . . . . .

Total. . . . . . . . . . . . . . . . . . . . . . . . .

Plating . . . . . . . . . . . . . . . . . . . . . . .

Refrigerator. . . . . . . . . . . . . . . . . . .

Wt. (lbs.)

161

70

16

49

7

2

11

6

6

1

1

4

12

6

3

2

1

1/2

1/.

SOURCE Working Paper Three

anced by increased handling, reject, and manufacturing costs. If current tooling is used (welding) for

attaching the ribs, then the side would have to be

refinished before the acrylic finish could be applied. Excessive finishing to remove a ’’bad spot”

could drastically weaken that spot so much that

damage could result from handling and usage.

Thin metal is, of course, more damage prone.

More dents in the metal sides would result in increased reject rates and scrapage. Although these

costs were not estimated, they would surely be

larger than the costs of the metal saved.

In addition, for many products a certain amount

of “extra” weight is required for stability or some

other important reason. This is particularly true for

refrigerators. The danger of a child tipping over the

refrigerator by hanging on the door must be reconciled with the saving of metal. This same general

concern applies to almost every other piece of

equipment studied. In machine tools, extra metal

is added for damping out vibrations that would

shorten the life of the equipment and affect the

quality of the work. In tractors, the weight of extra

metal is considered necessary for adequate traction. This excess weight need not be metal, and

substitutes such as concrete and water have been

used with some success. These substitutes were

not reflected in the 5- to 10-percent calculation.

The results presented for refrigerators apply generally to the other products of this report. That is,

although elimination of some excess metal is possible, the difficulties include increased manufacturing costs, increased cost of investment in engineering and equipment, decreased durability, and reduced safety. This is a large price to pay for the

small savings of metal possible. And, if there were

adequate recycling, this small amount would be of

no concern since the metal would be reused. Furthermore, strong economic incentives already act

to encourage the minimum possible use of metal

in the manufacturing process. The fact that these

factors do operate in the interests of conservation

is demonstrated by the data of figure 25. As shown,

the weight of specific models of refrigerators has

dropped substantially in the past, and will undoubtedly continue to do so in the future. Such

data have not been assembled for other products,

but the same considerations would apply.

EXTEND PRODUCT LIFE

Extension of product life was first thought to be The approach used was to (a) determine the

a method of saving a considerable amount of mate- amount of aluminum and copper that could be

rials. However, the design study did not indicate saved by a 50-percent increase in the mechanical

that extended life would save very much (5 to 10 life of refrigerators, automobiles, and shipping conpercent). In order to further check this option, a tainers; (b) apply these results to a range of highmore detailed study was conducted. metal-use products for which life extension was
Ch. VI—Analysis of the Most Significant Technical Options for Reducing Excess Metals Use ● 71

Figure 25. —Refrigerator Weight Reduction for Different Models as a Function of Time

400 -

I 1 J I I 1

Single Door

380 -

-- — 2 Doo r

- 38

360

340

320

300

280

260

240

220

200

180

160

\ 20SXS

\

\

\

\

\

\

16T \

\

1 oft3

\

14T’ \ \

\ \

\ \

\ \

\ \

\ \

- 36

- 34

- 32

- 30

- 28

-

26

- 24

17T

1 5 T

-

22

- 20

- 18

46 50 55 60 65 70 75 77

Year

SOURCE: Data supplied to OTA by a refrigerator manufacturer

considered possible; and (c) identify the practicality, benefits, and costs of product life extension.

The detailed methodology is discussed in the

next section. Basically, a quantitative model was

developed that described the chain of cause and effect underlying each product’s sales, discards, consumption of copper and aluminum, and mechanical lifetime. With this model, a change in one variable (lifetime) allows an estimate to be made of

changes in other variables (copper and aluminum

consumption).

These models were used to estimate the amount

of material that could be saved per year with a 50-

percent increase in mechanical life, as shown in

table 32. For refrigerators, increasing the lifetime

from 15 to 23 years would result in a 15-percent

saving of both aluminum and copper. These results are similar to that found in the design study

for automobiles and refrigerators.

Table 32.—Percent of Metal Saved

Per Product Per Year*

Metal saved per product

Product per year

Refrigerator . . . . . . . . . . . . . . . . . . . . . . . . 1 50/0

Automobile. . . . . . . . . . . . . . . . . . . . . . . . 90/ o

Aluminum vans . . . . . . . . . . . . . . . . . . . . . 25°/0

Air freight containers . . . . . . . . . . . . . . . . 2 7 %

*With a 50-percent Increase in mechanical Iife

SOURCE: OTA, based on Working Paper Five

Although a 50-percent increase in mechanical

lifetime is quite large and more dramatic results

might have been expected, the impact has been

limited by a number of factors. First, nonreplacement refrigerator sales, which arise from the growing number of households, are not affected. Secondly, it takes many years before the new, longer

lived refrigerators gradually replace the large number of older, shorter-lived refrigerators currently in
72 “ Metal Losses and Conservation Options

use. As a result, the discard rate does not change

for a number of years. Third, the continuing demand for refrigerators with more up-to-date features implies that some refrigerators are being replaced before they physically wear out. Thus, the

actual average lifetime of refrigerators does not

keep pace with the increasing mechanical lifetime,

but only rises from the present 15 years to about

20 years by 1990. Finally, the saving of 4,000 to

5,000 tons of aluminum and copper must be balanced against the 15-percent reduction in sales

and employment that the analysis indicated would

result from the longer life.

In sum, increasing the mechanical lifetime by 50

percent reduces 1990 sales and materials consumption of refrigerators by only 15 percent and

automobiles by only 9 percent, largely because

these products are subject to voluntary scrapping

before they reach their full mechanical lifetimes.

The impact of increased durability is greater for industrial products, however, because these goods

tend to be pushed to the limits of their useful lifetimes. For example, a 50-percent increase in the

life of airfreight containers reduces airfreight container sales and materials consumption by 27 percent by 1990. Based on this analysis, industrial

products with short service lifetimes have greater

potential for metal savings than do consumer products with long lifetimes.

To explore the conservation potential of increased product life, a workshop was held in

Washington, D. C., on February 23, 1976. (A summary of the findings is given in appendix A.) Wear

control was chosen as an example of a technology

to increase product durability. Experts from the

field along with representatives from industry discussed the status of wear-control technology and

its application in the design and maintenance of a

range of products (railroad equipment, automobiles, aircraft propulsion, naval aircraft structures,

metal-cutting machinery, tools, and heavy construction equipment). The workshop concluded

that technology is not a limiting factor for increasing product durability. Almost any desired life

could be obtained. Improved product durability is

available if the consumer wants it, demands it, and

is willing to pay for it.

Secondly, the workshop found that product life

is often not limited by the mechanical condition of

the equipment. For almost all of the products considered, obsolescence was the most important

reason for removal from service, not mechanical

life. For household products and appliances, customer preferences are vital in determining the life

expectancy of products. A recent study of small appliances showed that 50 percent of the products

removed from service were still operable.2 Thus,

many consumer products are discarded regardless

of their mechanical conditions. This occurs for a

variety of reasons, such as rising service costs, affluence, appearance, style changes, population

mobility, availability of disposable income, or inability to locate adequate repair facilities or parts.

In sum, the workshop concluded that technically longer mechanical life can be designed into a

product. But a longer mechanical life will probably

cost more, may not result in a significant increase

in the actual average lifetime (due to the fact that

many products are retired because of reasons having nothing to do with lifetime, as listed above),

and at best would take many years to accomplish

(since only the replacement market would be affected).

Furthermore, product life extension is a practical materials-saving strategy for only a limited

number of products, particularly those which have

a short life and are not disposed of, or consumed in

use. Table 33 shows the 1974 distribution of the

eight metals by industry. Product life extension

would apply to transportation and consumer

durables (appliances), which account for 12 to 28

percent of metal usage, depending on the metal.

Even if the maximum savings from the previous

product analysis (27 percent in table 32) were applied to the maximum base of 28 percent, this

would result in only a 7.5-percent metal saving.

However, table 33 shows 43 percent of the iron

in the remainder column and therefore unaccounted for, along with large amounts of manganese, chromium, and nickel that are used primarily as alloys in steel. Accordingly, a second approach was used to doublecheck the results. From

data on metal distribution into end-use products, a

list was compiled of all products for which life extension was even remotely possible. By adding the

ZW. David Corm, Op. Clt
Ch. VI—Analysis of the Most Significant Technical Options for Reducing Excess Metals Use . 73

Table 33.—Distribution of Metal Flows by Industry Sector (percent of 1974 metal shipments)

Al Fe Cu Pt Mn Cr Ni W

Construction 23a 12 2 0 Nil 11 21 9 –

Transportation 18 19 11 2 8 21 17 21 12

Machinery 8 16 19 Nil 16 14 7 71

Appliances 9 2 3 Nil 2 – 7 –

Packaging 17 8 - Nil 7 – —

Electrical 13 2 8 2 8 5 – 13 11

Remainder 12 4 3 19 4 4 3 8 4 3 4 3 6

Alloying & plating 3 - — — 9 7 8 2 6 4 8 4

Amount of metal to which

product life extension 2 7

b

21 14

applies

Nil 2 3 17 2 8 12

Amount of metal to which

product life extension

applies (product-by-product 19 2 6 2 4 Nil 19 5 11

analysis)

aPercentage of aluminum used in construction Industry

bDetermlned from sum of transportation (18 percent) and appliances (9 Percent)

SOURCE: OTA, based on Worktng Paper Two

amount of metal in each of these products, a sec- domestic shipments). These estimates are included

ond estimate was calculated (as a percent of 1974 in the bottom row of table 33 and are quite similar.

EXTEND PRODUCT LIFE OF REFRIGERATORS:

AN EXAMPLE OF SYSTEMS DYNAMICS METHODOLOGY

As summarized in the previous sections, a separate study was conducted to determine the materials saved by a 50-percent increase in mechanical

lifetime. Systems dynamics, an analytical methodology, provided a conceptual framework and mathematical technique for investigating the materials

savings and impacts of product life extension. In

this section, the refrigerator case is described in

detail to illustrate the approach. The details of this

study are given in Volume II— Working Papers,

and Working Paper Five (vol. II-E) in particular.

To assess the impact of extended mechanical

lifetime on materials consumption, a quantitative

model was developed that described the chain of

cause and effect which underlies refrigerator sales,

discards, consumption of copper and aluminum,

and mechanical lifetime. The model developed is

shown in figure 26. The materials consumption of

the refrigerator industry is determined by refrigerator sales and the metal content of aluminum and

copper per unit. Sales of new refrigerators can be

divided into two components: nonreplacement

sales that arise from population growth and an increasing number of units desired per family; and

replacement sales which replace the refrigerators

that are discarded. The difference between the

total number of refrigerators desired and the actual

stock of refrigerators in use is what drives nonreplacement refrigerator sales. The scrapping of

refrigerators that are worn out or that are simply

discarded is what motivates replacement sales.

Based on this description of the refrigerator sales

and materials consumption system, a mathematical representation of the system was developed

using the DYNAMO computer simulation language. Equations were written to represent the

quantitative relationships that determine refrigerator sales and copper and aluminum usage. Numerical parameters used to quantify the model were obtained from a variety of sources (such as Bureau of

the Census reports, journal articles, and industry

data).
74 ● Metal Losses and Conservation Options

Figure 26.—Overview of Refrigerator

Model Structure

{~::::ita\ ~ Households

Size, features \/

desired ~ Refrigerators

/ F

Materials

/

per unit

Copper,

[

aluminum

consumption

Employment

>

desired

\

/~

Replacement

Average sales I

mechanical

I

Replaced

lifetime

\

scrapped ~

refrigerators

refrigerators Ab Used i

// Price,

operating, /

Household

moves

SOURCE: Working Paper Five.

The quantified refrigerator model was then simulated by computer over the period from 1960 to

1990. Starting the simulation in 1960 allows a

comparison of model behavior with the actual

course of events, thus providing one check on the

validity and accuracy of the model. Sensitivity testing, that is, varying the base case assumptions,

provided insights into the critical factors governing

the behavior of the system. Finally, the model was

used to examine the impacts on refrigerator sales,

materials consumption, and employment of potential conservation policies such as increasing product lifetime.

The results of this analysis showed that materials consumed in the production of refrigerators has

grown through the 1960’s and early 1970’s. This

growth of sales and associated materials use is due

to two factors. First, the number of households was

growing rapidly because of the relatively high rate

of population growth and especially because of the

coming of age of the postwar “baby boom” generation. Secondly, the price of refrigerators was declining relative to disposable personal incomes,

tending to increase the average number of refrigerators desired per family. In the future, the forecasting model developed indicates that refrigerator

sales, and thus materials consumption, will increase only slowly. This is due to several factors.

First, census projections indicate that the number

of new households will increase much more slowly

since the postwar generation has already largely

established their own households and population

growth has slackened. Second, there will likely be

little increase in the number of refrigerators desired per family, even if it is assumed that the

relative price of refrigerators continues to decline.

The model indicates that the combination of these

factors will cause the reduced growth rate.

In the forecast, the average lifetime of refrigerators in service remains close to 15 years. This

value is in close agreement with results of several

consumer surveys of appliance lifetimes conducted

since the late-l 950’s. This average service life is,

however, 2 years less than the average mechanical

lifetime of refrigerators. This occurs because some

refrigerators are discarded when their owners

replace them to get larger ones or units with more

up-to-date convenience features. This process contributed to the historical growth of sales, for as incomes rose, people desired larger refrigerators and

replaced their old ones. In the future, the average

desired refrigerator size is not foreseen to increase

as rapidly as in the past. As a result, the model indicates that refrigerator sales will lose some of this

additional source of replacement sales.

Aluminum, due to its cost advantages, has been

making inroads into refrigerator heat exchanger

and some electrical uses that have been held by

copper. Thus, aluminum consumption in refrigerator production increased from about 20 million to

45 million lbs between 1960 and 1974, while copper consumption only increased from 20 million to

35 million lbs. Direct employment in the production of refrigerators grows only slowly in the

future, again due to the slow growth in sales.

Increasing the mechanical lifetime of refrigerators would reduce materials consumption in the

future by reducing the refrigerator discard rate to

some degree and thus the attendant replacement
Ch. VI— Analysis of the Most Significant Technical Options for Reducing Excess Metals Use ● 75

sales. The model was used to test the impacts of (see figure 27). By 1990, refrigerator sales, copper

such a policy by assuming that the average me- and aluminum consumption, and employment are

chanical lifetime of refrigerators produced after 15 percent lower than they would be without the

1977 is increased by 50 percent, to about 23 years longer refrigerator lifetime (see figures 28 and 29).

REDUCED USE OF MATERIALS-INTENSIVE SYSTEMS,

SUCH AS ALLOYS

In part, because of the relatively low cost of

materials, the United States has become “materials

intensive” and has chosen the use of systems that

use a large amount of material. Examples might be

the use of private vehicles instead of public transportation, larger homes rather than small apartments, private equipment ownership rather than

rental, and large sizes rather than small. As metal

resources are depleted, it may be necessary for

society to become more resource-conserving as it

is now attempting to do with energy. One aspect of

this approach was investigated in detail in this

assessment, the use of alloys.

Over the years, the development and use of

alloys has proliferated to meet the needs of increasingly stringent product and manufacturing requirements and specialized production machinery.

A large number of metals are used almost exclusively as alloy additives or coatings. The technical

option explored in this section is the reduced use

of alloys or the reduced-use of metals used in

alloys. In considering this option, it must be recognized that a small change in the alloy ingredients

can drastically change the resulting properties of

the alloy.

The use of metals in alloys is shown in table 34.

This table shows the percent of each metal listed in

the vertical column that is used in each alloy listed

in the horizontal column. This table accounts for a

large percent of metal usage as indicated by the

column totals. The only items not included are

chemical uses of metals and the use of certain

metals, for example, zinc, in their own alloys. In

regard to conservation of alloying metals, the major conclusions using this table are as follows:

● The amount of metal used in any given alloy

is small. Only under very critical circumstances would it be justifiable to conserve the

alloy in order to conserve a few percent of its

ingredients.

● A large amount of metal is used with steel,

either as an alloy or as a coating; the total

percentage is shown in table 35.

If these metals are to be conserved, reductions or

changes in their use with steel will be more effective than reductions or changes in the use of the

steel products themselves.

Two major options are available—use of substitute coatings or substitute materials in alloys. A

large percentage of many metals are used as coatings to protect steel from corrosion and wear. In

addition, a significant percentage of stainless steel

alloys, tool steels, copper alloys, and carbides are

used for corrosion and wear prevention. If nonmetallic coatings (e.g., ceramic or plastic) could be

substituted, appreciable metal would be saved.

This approach would reduce demand for metals

that the United States must import, and would increase the demand for steel, which is in adequate

domestic supply.

A wide variety of nonmetallic coatings are used

for corrosion and wear resistance, although they

do have certain technical limitations such as brittleness, lack of electrochemical effects, etc. A major benefit of the use of substitute coatings is flexibility. It is much easier to change a coating than to

change the whole material. A more detailed investigation of metallic and nonmetallic coatings is

needed.
76 . Metal Losses and Conservation Options

30.0

22.5

15

7

.0

.5

0

Figure 27.— Refrigerator Model: Longer Mechanical Lifetime Case,

Refrigerator Lifetime Over Time

1960 1970 1980 1990

SOURCE Working Paper Five.
Ch. VI—Analysis of the Most Significant Technical Options for Reducing Excess Metals Use ● 77

Figure 28.— Refrigerator Model: Longer Mechanical Lifetime Case,

Employment and Sales Over Time

1960 1970 1980

I 20

30

60

30

0

1990

SOURCE: Working Paper Five
78 . Metal Losses and Conservation Options

Figure 29.— Refrigerator Model: Longer Mechanical Lifetime Case,

Aluminum and Copper Consumption Over Time

Q

a

7 2

5 4

36

18
Ch. VI—Analysis of the Most Significant Technical Options for Reducing Excess Metals Use ● 79

Table 34.—Materials Usage in Alloys (percent)

Cr 50

co 3

Cu

Cb 4 - .

Fe 3

Mg

Mn 3

Mo 2

Ni 3 5

I

Pb

Sb

Fn

Ti

W 1

V .5

Zn

+

8 1.2

-+-

1.3 9

+

.— 9 5 -

16 24

I

*

51 2

1 2

1

,

I

+

3

24 1

SOURCE: OTA based on Working Paper Three

Product

Iron I

Table 35 .—Metals Used With Steel

as Alloys or Coatings

Percent usage

in or on steel

. . . . . . . . . . . . . . . . . . . . 93 ‘

-

Manganese. . . . . . . . . . . . . . . . . . . . .

Columbium. . . . . . . . . . . . . . . . . . . .

Molybdenum . . .

Chromium. . . . . . . . . . . . . . . . . . . . . .

Vanadium . . . . . . . . . . . . . . . . . . . . .

Cadmium . . . . . . . . . . . . . . .

Nickel . . . . . . . . . . . . . . . . . . . . . . . . . . .

Zinc, . . . . . . . . . . . . . . . . . . . . . . . . . .

Tin . . . . . . . . . . . . . . . . . . . . . . . . . .

Cobalt . . . . . . . . . . . . . . . . . . . . . . . . .

Tungsten . . . . . . . . . . . . . . . . . . . . . .

Magnesium. ., . . ..., ..., .

96

95

73

66

66

60

58

41

34

31

22

8

6

I

I 3

SOURCE: OTA based on table 34.
80 ● Metal Losses and Conservation Options

SUMMARY OF OPTIONS AND POTENTIAL SAVINGS

Table 36 summarizes the technical options and

the potential metal savings for each. Three additional categories have been added to this table for

comparison purposes. The first category “savingsminor” indicates the reductions in metal usage

that could be accomplished with relatively minor

effort, primarily through the use of proven substitutes in cottagetype industries where changes in

production equipment would not be necessary.

The “saving-major” category is based on World

War II experience and indicates the amount of

metal diverted from the civilian sector to war production (for details see appendix B). These percentages show the range of flexibility in metal usage.

During wartime when flexibility became absolutely necessary, major metal savings in the

civilian sector were accomplished with a very tight

allocation system that drastically reduced the consumer products that could be manufactured. Production was diverted to war products, so severe

economic consequences were averted. This would

not be the case in peacetime. Table 36 also indicates the amount of metal that went into stocks

during 1974. Although 1974 may not be a typical

year, these numbers given some basis for comparison with the other options.

Clearly, the largest potential savings apply to

three options: substitution, product reuse and remanufacturing, and during wartime or crisis conditions, some sort of an allocation system. The elimination of excess metal would decrease the use of

steel by 9 percent but would save relatively little of

the other metals. The use of nonmetallic coatings

yields potential savings of 13 percent for nickel but

would increase the use of steel by approximately 4

percent. By comparison, the other options (component remanufacturing, reduced product size, and

increased product life) offer very small potential

savings.

Table 36.—Potential Savings From Technical Options by Reducing Excess Metal Usage

Savings as percentage of 1974 shipments

Technical options Iron/steel Aluminum Copper Platinum Manganese Chromium Nickel Tungsten —. . . ————

Metal substitution; . . . . . . . . . 29 60 59 24 — 16 20 32

Metal substitution in

construction. 7 6 20 — — —

Product reuse. . . . . . . . . . . . 11

— —

15 32 — — 6 15

Product remanufacturing . . 30

—

30 43 — 24 12 9

Component

—

remanufacturing . . . . . . 3 1 4 — — 2 2

Eliminate unnecessary

—

metal . . . . . . . . . . . . . . . 9 8 6 — — 4 8

Reduce size . . . . . . . . . . . . 3

—

3 2 — — 1 4

Increased product life . . . . . 8

—

5 9

Nonmetallic coatings . . . . (4) _ _ _ _

—

5 13

Other options

—

(for comparison purposes)

Savings—minor. . . . . . . . . . 11 14 18 — — 4 8

Savings—major . . . . . . . . . 52

—

90 90 57 60 57

Use of stocks . . . . . . . . . . . . —

—

6 13 3 17 — 6 32

— —

SOURCE: OTA. based on Working Paper Three

—
VII.

Preliminary Policy

Considerations
Vll ●

Preliminary Policy Considerations

INTRODUCTION: MATERIALS CONSERVATION OBJECTIVES

In the previous six chapters, the technical options were evaluated for their potential to conserve

metal. Several promising options were identified.

However, these options must also contribute in

some meaningful way to the solution of current or

anticipated materials problems, or to the accomplishment of some recognized materials objectives.

In this chapter, the technical options are evaluated

in terms of materials objectives and problems.

Through the use of systems analysis, the technical

options are matched with materials problems. And

finally, illustrative methods of implementing the

more promising options are presented and briefly

discussed.

Conservation is a response to some real or imagined threat or condition, and conservation options

are implemented in attempting to accomplish

some objective. The primary objective of concern

in this assessment has been materials availability,

either short term or long term. However, there are

a number of other objectives that might be relevant to materials conservation, such as conserving

energy, reducing the volume of waste, stabilizing

materials markets, protecting the environment, or

promoting a resource-conserving society. These

objectives are not independent of each other but

are merely different “end points” which may be

achieved through materials conservation.

Materials availability, either short term (during

critical situations) or long term (with respect to

resource depletions), is a vital concern to both industry and society. Without the proper materials,

many industries would be forced to close unless

alternative plans were made well in advance. As

shown in appendix C, materials shortages have

been commonplace for many years and will undoubtedly continue in the future. If these problems

become severe enough, conservation is a possible

response.

Likewise, energy conservation can affect the

availability of materials. Since metals refining consumes about 9 percent of the energy budget and all

materials 20 percent, materials conservation could

be a response to the need for energy conservation.

Indeed, for the foreseeable future, energy conservation will probably be more important than materials conservation because energy availability is a

prerequisite for materials production and use.

MATERIALS AVAILABILITY PROBLEMS

Conservation is one appropriate strategy to deal conservation measures and whether conservation

with a large number of materials problems that is the best among available strategies.

threaten materials availability, such as the following conditions:

●

●

●

●

●

●

●

chronic lack of capacity,

import dependency,

energy conservation,

cyclical instabilities,

environmental restrictions,

long-term depletion, and

technological changes.

Energy and environmental considerations are

introduced here not as objectives for materials conservation but rather as factors that could and probably will affect materials availability. For example,

weight reduction in vehicles to conserve energy

will affect both steel and aluminum availability.

Use of catalytic converters has greatly increased

the demand for platinum. And installation of solar

This report does not attempt to judge which, if any, energy units in homes will most likely increase the

of these problems are serious enough to justify demand for certain specialty metals.

83
84 ● Metal Losses and Conservation Options

Chronic Lack of Capacity

Chronic lack of capacity occurs when new domestic plant capacity is not built due to lack of sufficient investment incentives. As demand increases, the margin between capacity and average

demand shrinks. Shortages increasingly become

the “rule” rather than the exception. This shortage

condition encourages customers to buy the materials from foreign sources at inflated prices, which

then encourages new capacity overseas. Once installed overseas, strong incentives work to keep

this capacity operational, even if it means operating at a loss. A trend towards shrinking U.S. capacity and growing foreign capacity is thereby established.

Import Dependency

import dependency is a potentially critical problem. Currently, the United States imports approximately 30 percent of its metal needs. Some nations are completely import-dependent and have

learned to live with this situation. However, the

United States is in a unique position as a world

leader and may not find import dependency to be

in the national interest. Even if import dependency

can be tolerated now, it may not be acceptable in

the future under changed world conditions. Some

argue that the United States is import-dependent,

and there is very little that can be done to change

that fact. This is true to a degree. However,

changes in materials usage through conservation

can reduce this dependency to a minimum or

eliminate the use of import-dependent materials

from critical applications. If the supplier countries

become less economically dependent on minerals,

they may become “conservationists” and no longer encourage the exploitation of their natural

resources. Furthermore, import dependency aggravates the U.S. balance of payments, and leaves us

vulnerable to possible supply disruptions from political or military activity.

Energy Conservation

The current campaign for energy conservation

can strongly affect the availability of materials by

influencing the cost, demand, and relative use of

materials. Metals refining consumes about 9 percent of the total U.S. energy budget; ail materials

20 percent. The energy intensity (1,000 Btu/$) at

each stage of the materials cycle is shown in figure

30. Refining and fabricating require several times

the national industrial average. Thus, materials

and energy are intimately associated.

Theoretically, with unlimited energy, any material could be obtained from common rocks as lowgrade ores or from nuclear chemistry. In more

practical terms, the “energy materials’ ’—such as

natural gas, oil, and coal, on which the United

States has come to depend—are being depleted at

rates greater than the materials from which products are made. For the foreseeable future, therefore, energy conservation will be more important

than materials conservation because energy availability is a prerequisite for materials use, and

energy sources are almost universally in shorter

supply than materials for making products. A more

detailed discussion of the energy-materials relationship is included in Working Paper Six. (vol.

11-F.)

In the short run, energy conservation, as well as

the effort to increase energy supplies, will lead to a

greater use of materials rather than reduced demand. This will happen in spite of increasing materials prices, and will aggravate other problems

such as import dependency. Further reduction of

materials losses from industrial processes would in

many cases be energy intensive. On the other

hand, recovering materials by recycling and preventing loss of sunken energy investments in products and their components through remanufacturing promises to save large amounts of energy

while simultaneously conserving materials.

Finally, the flexibility offered by materials substitutions will likely be necessary to improve overall energy efficiency and meet the changing demands for energy supply while maintaining reasonable standards of environmental quality. Materials substitution will more likely be driven by the

need for energy conservation than for materials

conservation or the reduction of materials “waste.”

Cyclical Instabilities

Short-term availability problems occur as supply

shortages and/or price fluctuations. In 1973, a
Ch. VII—Preliminary Policy Considerations ● 85

L
86 ● Metal Losses and Conservation Options

combination of factors made cyclical shortages

unusually severe. At that time, contrary to the

popular notion, certain metals were not available

to some customers at any price. Because of overcommitment, these suppliers would not take new

orders. Since shortages can manifest themselves

within relatively short periods of time, the normal

market responses are not available and severe impacts can occur. Unlike the other problems, this

one is less predictable and could occur at any time,

with any metal.

During the period from 1946 to 1977, interruptions in supply were constantly occurring for the

eight metals analyzed in this study. Factors affecting the supply of such metals include: governmental regulations, capacity limitations, raw materials

shortages, strikes, transportation disruption, import limitations, unusual demand surges, and acts

of nature, for example, severe weather conditions.

While a tight supply situation can result solely

from the general fluctuations of the business cycle,

the occurrence of supply disruptions adversely affecting industry usually involves the combination

of several factors, for example, unusual demand

combined with capacity limitations, and/or demand surges combined with raw materials shortages.

Tight supply situations or actual disruptions in

supply occurred as follows:

●

●

●

●

●

●

●

aluminum was in tight/short supply in

1950-53, 1966, 1972-74, and early 1976;

ferrochromium alloys were insufficient to

meet peak steel demand in 1973-74;

copper was in tight/short supply in 1946-48,

1954-56, 1959, 1965-68, and 1972-74;

nickel was in short supply during 1950-57,

1966, and 1974;

supply shortages of scrap were apparent in

1948, 1952, 1955-57, 1969, and 1973-74;

steel was in short supply in 1947-57, 1959-60,

1969-70, 1972-74, and the first quarter of

1977; and

the supply of tungsten was interrupted during

1972-74.

Thus, the facts indicate that tight/shortage situations in regard to these seven metals did constantly occur over the past 30 years. Since the factors

that combined to cause such supply disruptions

were not metal specific or time specific, the probability of shortage conditions occurring in the future

in regard to such metals is quite high. (See appendix C for further discussion.)

Environmental Restrictions

Concern for the environment may favor the use

of certain materials and restrict the use of others.

Some metal-processing techniques discharge more

pollutants to the atmosphere than others. Since the

damage done to the environment is often not reflected in the metal cost, conservation may be

mandated. The environment is a major consideration and any conservation options should be evaluated for environmental impacts. Municipal solid

waste is a special environmental and economic

problem. Any options that could effectively reduce

the amount of material entering the waste stream

would be beneficial, both from an environmental

as well as a conservation standpoint. Thus, the reduction of the amount of municipal solid waste is a

strong driving force for conservation of those materials that find their way into this waste system.

Long-Term Depletion

The depletion of natural resources is an area of

major materials concern. However, there is little

danger of actual physical exhaustion over the next

20 to 50 years. This is not to say there are no problems. Old mineral deposits are being worked out

and new ones are being discovered, But levels of

ore quality are declining. If new mining technology

does not increase the accessibility of low-grade

ores, then prices will rise and supply shortages

may develop. This will come sooner for materials

such as gold, mercury, silver, tin, lead, and tungsten than for other metals such as iron, aluminum,

and nickel.

Technological Change

Technological changes will require shifts in

materials usages. No unusual technological

changes are expected to radically alter demand

over the next 25 years. However, these estimates

are based primarily on historical data and expected
Ch. VII—Preliminary Policy Considerations ● 87

growth in the gross national product (GNP) and reduce demand for structural metals such as steel

population. Probably the major technological and aluminum. Deep sea mining, if it

change, other than in energy, would be the wide- economically feasible, could increase the

spread use of composite materials. This would certain metals by an order of magnitude.

MATCHING CONSERVATION OPTIONS TO

MATERIALS AVAILABILITY PROBLEMS

becomes

supply of

If a specific materials problem arises (for example, a threat to the supply of nickel), then specific

technical conservation options to address the problem could be selected from table 24 (reducing

losses) or table 36 (reducing excess metal usage).

These tables identify options with the greatest

potential to save metal, but do not indicate the applicability of the options to specific materials availability problems. Given the many possible materials availability’ problems, a technique or approach

is needed to match conservation options to materials problems.

The approach used in this assessment was a systems analysis that classified the problems and the

possible solution (options) in terms of their overall

impact on the parameters that describe the behavior of the system. [n this case, the system is the

materials cycle, and the parameters are efficiency,

stability, and adaptability.

Thus, the systems analysis concepts of materials

efficiency, stability, and adaptability were used to

establish a linkage (or matching) between technical conservation options and materials problems.

These concepts are summaried below and in table

37, and discussed in more depth in Working Paper

Six, (vol. II-F).

Improved efficiency means better utilization of

resources or making the best use of what one has.

It means making products with a minimum expenditure of materials consistent with other accepted values of society. Efficiency does not rate

materials saving as the only priority, but tries to

optimize usage based on a whole spectrum of criteria. Options to improve efficiency attempt to

reduce the total material usage and usually deal

with losses. Efficiency is one appropriate response

to resource depletion, that is, a gradual reduction

in losses and usage over the remaining resource

life.

Improved stability is an attempt to assure a

more adequate and consistent amount of materials

in the material cycle to satisfy demand. It means

Table 37.—Systems Analysis Concepts of Materials Efficiency, Stability, and Adaptability

——.

Goals”. . . . . . ,‘. . . .

Resource emphasis .

Resource management

Resource flows

(along cycle) . .

SOURCE Working Paper SIX

Efficiency

.

Optimize according to

recognized goals and

objectives.

Reduction of wastes; make

sure all resources are fully

utilized (labor, equipment,

energy, capital, materials).

Reduce operating margins

(excess capacity, labor,

inventory, and stockpiles).

Assume predictable controlled

transactions; establish

minimum number of source:

and markets.

Stability

Make sure that all actions will –

suffice in satisfying recognized

goals.

Protect/on against all possible

failure modes or malfunctions;

build in redundancy and

safeguards.

Increase operating margins to

allow for errors or contingencies; provide standby

capacity.

Reduce variability and diversity;

establish overlapping but stable

sources and markets.

Adaptability

Evaluate appropriateness of

existing goals under changing

conditions; identify new goals

or objectives.

Rapid adjustment to change,

capability to cope with

variability, innovation, search

for new opportunities.

Provide substitutes and

alternatives (materials,

processes, facilities, sources

of supply).

Provide fall-back options and

decision mechanisms for

rapidIy redirecting flows under

changing circumstances.
88 . Metal Losses and Conservation Options

taking actions to protect market participants

against possible failure modes, to reduce the cyclical variabilities, and to remove market instabilities. Options consistent with stability are increasing standby capacity, use of multiple sourcing,

economic stockpiling, and improved information

on materials supply and demand.

Improved adaptability, on the other hand,

means more rapidly adjusting to change and

coping with problems as they arise. It means developing the capability to deal with and overcome

problems, difficulties, threats, or conditions as they

occur.

Unfortunately, some options can lead to conflicts among materials efficiency, stability, and

adaptability. That is, all-out efforts to improve efficiency can reduce the slack in the system and lead

to a destabilization of the market and reduced ability of industry to cope with materials problems as

they arise. Moves by the Government to stabilize

markets can reduce efficiency and adaptability.

Finally, efforts to become more adaptive may compromise both efficiency and stability.

For example, options to improve efficiency will

reduce the amount of material used. But as a result, there will be less slack in the system to absorb

unforeseen shortages, and companies will be less

able to adapt. As companies exercise the limited

number of options to reduce the amount of material used in product manufacture, these options are

then no longer available to stabilize supply/demand or cope with unforeseen events,

On the other hand, actions to become adaptive

include developing substitutes, establishing a

variety of sources, multiple ordering, having extra

material on hand, and, in general, developing a

pattern of usage that gives the user a variety of

choices to cope with all uncertainties. All of these

actions are, by nature, materials inefficient. Furthermore, this ability to adapt can be exercised at

the discretion of the materials user for any reason

he chooses. If he is a major user, his action and the

counteractions by other stakeholders might cause

a very unstable market. Materials suppliers might

not be able to predict from year to year what the

demand would be and plan production. They

would either overproduce or underproduce. Overproduction would lead to lower prices and inefficient use. Underproduction would lead to shortages and greater instability.

As indicated earlier, materials problems can be

classified as requiring improved materials efficiency, stability, and/or adaptability. As shown in table

38, all problems cited—except for chronic lack of

capacity and long-term depletion—appear amenable to options that improve adaptability. Balance

of payments, energy conservation, environmental

restrictions, and long-term depletion problems call

for options to improve efficiency. Finally, lack of

capacity and cyclical instabilities suggest options to

improve stability.

Table 38.—Materials Problems Require Improved

Efficiency, Stability, and/or Adaptability

Improved Improved Improved

Materials problems efficiency stability adaptability

Chronic lack of capacity. . — @ —

Import dependency

Balance of payments . . K — /

Threat of disruption . . . — — /

Energy conservation. . . . . K — #

Cyclical instabilities

Stable prices/shortages — / @

Unstable prices/steady

demand. . . . . . . . . . . . — @ @

Environmental restrictions z — @

Long-term depletion . . . . . ~ — —

Technological changes . . — — /

SOURCE: Working Paper Six.

Thus, based on this analysis, most future materials problems seem to be more amenable to improved industrial adaptability rather than to improved efficiency or efforts to stabilize the materials markets. This does not mean that industry

should become less efficient or that markets

should be destabilized. It also does not mean that

adaptability should be stressed to the exclusion of

efficiency and stability. Rather, it does suggest that

a balance between efficiency, stability, and adaptability should be maintained. And at this time conservation options that increase adaptability require

primary consideration. However, at the same time,

care should be taken that this increased adaptability does not sacrifice efficiency or stability to any

great degree.

Thus, the analysis suggests that competition

among organizations and alternative technologies
Ch. VII—Preliminary Policy Considerations ● 8.9

will continue to produce relatively great efficiency,

including materials conservation. The greater need

at present is for options to better anticipate societal

vulnerabilities, to devise strategies to cope with

recognized uncertainties, to establish norms for

orderly interactions among organizations, and to

assess the need for better adaptability in the face of

future contingencies. Under these conditions, private stakeholders would be able to plan for efficiency with a clear understanding of the opportunities and attendant risks.

In table 39, some of the more promising technical conservation options are classified according to

their ability to improve materials efficiency, stability, and adaptability. These options—with the exception of major savings (allocation) —apply to improving efficiency and/or adaptability. Also included in table 39 are illustrative methods of implementing some of the technical options. These

implementation options are discussed in the next

section.

Table 39.—Ability of Conservation Options to Improve Efficiency, Stability, and Adaptability

Improved efficiency Improved market stability Improved adaptability

Technical Options -

— — .

Increased metal recycling Metal savings (e.g., through Major savings (e.g., through

allocations) allocations)

Increased product remanufacturing Metal substitution

Increased product reuse Use of stocks

Reduced dissipative uses Export controls

Illustrative Implementation Options

Public data base Public data base Public data base

Improve product after-market Contingency planning Contingency planning market for

contingency shares certificates

Establish scrap inventory Market for contingency shares R&D on metal substitution.

certificates

—..

SOURCE: OTA, based on Working Paper SIX

\

ILLUSTRATIVE IMPLEMENTATION OPTIONS

In the previous sections, preliminary consideration was given to options with respect to their ability to solve materials problems that may arise in the

future. The purpose of this section is to briefly present illustrative methods of implementation applicable to the most promising options.

However, this report does not assess in detail

the impacts of the options on the economy, energy

conservation, environmental quality, employment, and other important impact areas.

A more detailed discussion of the implementation options can be found in Working Paper Six,

(vol. II-F). The implementation options listed

below are illustrative of the range of options that

could be considered.

Establish a Governmental Contingency

Planning Function

Periodic shortages and oversupply along with

price variation have been a part of the materials

supply system since the beginning of the industrial

age. Industry and consumers have learned to live

with this condition and in some situations to take

advantage of it. In most of these shortage situations, warning has been adequate. In the materials

field, suppliers and users maintain a close working

relationship and the suppliers are usually aware of

developing threats. [n addition, the Bureau of

Mines, the State Department, the Defense Department, and the Central Intelligence Agency monitor

materials supply and in most cases provide an adequate alert. Materials users whose business depends on a given material initiate their own information network independent of the suppliers
90 . Metal Losses and Conservation Options

and are often the first to anticipate a problem.

Through trade publications and the technical literature, this information is available to those who

choose to avail themselves of it.

The primary difficulty comes in responding to

the threat. Each organization moves independently to cover their own position and often overreacts,

which tends to make the situation worse. When

the supply does become limited, the suppliers invoke an allocation system that provides for an

orderly distribution to current customers. But this

system locks out other customers and provides little incentive to increase capacity. In addition, certain industries are more dependent on critical

materials than others and will suffer more during

times of shortage, with a greater negative impact

on the economy and total employment. The question is: What could the Government do now, if

anything, to be ready for such a situation?

One option available to Congress is to assign a

materials contingency planning function to one

Government organization. This organization

would be responsible for evaluating the severity of

perceived threats in materials supply and to

develop contingency plans to cope with these

problems should they arise. Such a function could

bean extension of the scope of work now provided

by various existing offices and bureaus. The main

advantage of this option is that it would provide, at

a small additional cost, a continuous appraisal of

the seriousness of the threats to be faced and the

ability of current mechanisms to counter those

threats.

Establish a Public Data System

Decisionmaking with regard to materials management in both the private and public sectors appears to suffer from a lack of comprehensive information and integrated analysis, insufficient

R&D on generic problems, and lack of a long-range

holistic view of materials problems.

The Federal Government is the only participant

in the process with the scope of concern and the

authority to collect, integrate, and disseminate information necessary to compensate for imperfections in market mechanisms and inequalities in

resources of the various actors. It may also be the

only participant with the resources, capabilities,

facilities, and long-range interest to fund the

research necessary to solve the technical problems

inherent in the transition to an economy of finite

resources.

A public data base would help to improve the

quality and quantity of information available to

Government and to industry for better analysis and

forecasting of materials supply and demand problems. It would also help identify R&D needs for

solving or alleviating technical problems in the

materials cycle (e.g., substitutions for temporarily

or chronically scarce materials, techniques for

separating and reclaiming scrap materials). Some

R&D support needs were discussed in an earlier

section.

New Government sponsored and operated information systems are favored by nearly all academic

observers and professional societies, by labor, by

Government experts (with a few exceptions, noted

below), and by some industry representatives.

Such actions have been opposed by the Departments of the Interior and Commerce. They maintain that existing systems, such as that of the

Bureau of Mines, are adequate. Some industries

oppose such systems on the grounds that they

would be a step toward a “nationally planned

economy” and an infringement on proprietary information rights.

A public data base would be the foundation

stone for many forms of private planning, public

policy review, and contingency planning. All the

basic public implementation options would require

specific evaluative information in the formulation,

operation, and modification of standards and

guidelines. The greatest need is for additional information on the end uses of materials and the

total quantities of a given material used in any

given product. Supplier inventories would also be

valuable information to assist in assessing the

need for implementing contingency plans and to

assist industry in locating scarce materials.

These two implementation options, contingency

planning and public data base, have been studied

in detail in an earlier OTA report Assessment of Information Systems Capabilities Required to Support

U.S. Materials Policy Decisions (December 1976).

Option 3 in that study, known as the Bureau of Ma-
Ch. VII— Preliminary Policy Considerations ● 91

terials Statistics and Forecasting, encompasses

these two options. Chapters VII and VIII of the Information Systems report provide a detailed discussion of the impacts and issues associated with implementation of such a Bureau with contingency

planning and public data base capabilities.

Establish a Market for Contingency

Shares Certificates

In this implementation option, a private sector

market for contingency shares certificates would

be established between materials suppliers and industrial customers of basic materials. This option

would be a private allocation system. The Government would not be involved in-these private sector

transactions. This market would be an extension of

the emergency allocation scheme that the metals

suppliers use now during shortages in which

shares are based on the previous year’s proportion

of total orders. In the contingency shares market,

customers would have to pay in advance for the

privilege of obtaining a share of limited supply

capacity during periods of shortage.

The contingency shares certificates sold in a

private marketplace between suppliers and users

would designate the fraction of available production capacity allocated to the certificate holder (and

guaranteed by the supplier) under the contingency

condition that all orders could not be met on

schedule.

Furthermore, the certificates would designate a

priority for the filling of the order. Those with the

highest priority would have their orders filled first.

But , unlike the successful wartime priority

scheme, lower priority orders would automatically

receive a higher priority following a specified

period of delay (possibly 1 month). In this way, all

orders are eventually filled because even those

orders with the lowest initial priority will eventually arrive at the highest level and receive attention.

The period of incremental increasing of priorities would be calculated according to the number

and size of the contingency shares sold. In this

way, the fact that a fraction of capacity is allocated

to each certificate holder and that those holding

lower priorities eventually receive attention prevents the highest priority certificates holders from

usurping the total supply by placing a large

number of orders.

The major effect of using these certificates to

allocate available capacity during periods of shortage would be to allow materials buyers to realistically assess their needs for an assured supply in

anticipation of possible shortages. The assessment

is based on a price mechanism, that is, the recognition that they will have to pay more for large capacity share and high priority.

The contingency shares arrangements allow’

market participants to anticipate the relative competitive pressure for materials under shortage conditions in order to make intelligent decisions about

substitutions while there is time to implement a

substitute, or to reconsider whether the material is

so important that their needs could not be deferred

in time of shortage. Revenues from the contingency shares would enable suppliers to attract investment capital for expansion if demand were running high. Movement in the contingency shares

market could give suppliers warning of shifts in demand enabling them to stockpile in advance or sell

potential surplus. Also, speculators would receive

much better price signals from the technically

astute stakeholders and would thereby be much

more likely to act to stabilize the market.

During periods of plenty, all orders would be

filled as they come in with no change from business as usual. Only during shortages would the

provisions and privileges of the certificates be important. The competition among various buyers

would determine the specific selling price of the

certificates, as in any securities or futures markets.

Speculators could buy certificates and gamble on a

shortage occurring to produce high profits in reselling these privileges and offering latecomers entry

into the market even though it may be tight.

Brokers would hold certificates and resell their

privileges in smaller blocks to make it easier for

small, intermittent, or new buyers to gain market

entry.

Additional provisions may be necessary for very

small customers so that they are not locked out of

the market as happens today during shortages.

The normal fraction of the market going to the

many small users (probably 10 percent of the total

market) could be set aside for bids during the
92 “ Metal Losses and Conservation Options

shortage—with only the small or intermittent user

or new entrants being qualified to place orders on

this fraction. This provision would require oversight inspection to prevent resale and speculation.

It remains to be seen whether brokers and speculators could provide this function better than the formal provision of set-aside capacity and the costly

oversight to go with it.

The prices for contingency shares certificates

would be a valuable indicator of “criticality” for

metals under abnormal market conditions; it

would also indicate beforehand which sectors

would be most hard hit (those bidding highest for

shares). Both public and private organizations

could benefit from these price signals to improve

their planning and coping strategies.

The contingency shares certificates market

would virtually eliminate the cause of materials

markets’ imperfections during periods of shortage.

Double ordering would be impossible without having paid for the privilege through the purchase of

certificates; this would reestablish the rates of

ordering as a useful indicator of real demand to the

materials suppliers.

Increasing private stockpiles leading into and

during periods of shortage would be impossible

unless the purchaser had also bought sufficient

certificates to gain the capacity to be able to

stockpile. In either case, the certificates would be a

useful indicator of real demand. The decision to

buy enough shares to stockpile would help to pay

for a needed expansion of productive capacity by

bidding up certificate values.

Price signals for shortage conditions would operate in advance of shortages or true contingency

events. They would thereby reduce the advantage

of “quick response” by major corporations. There

would be real penalties (one cost of the certificates)

for using materials for less essential applications

during shortage periods. By reducing hoarding and

double ordering, the glut following past shortages

would be moderated. In addition, increases in the

certificate prices would induce compensatory actions to cope with anticipated shortages rather

than increase materials prices per se.

Research and Development on

Metal Substitution

Substitution promises substantial savings for

specific metals. Approximately one-third of the

possible substitutions would use other metals; onethird, coatings (metallic and nonmetallic); and the

remaining third, nonmetals. Substitution can provide flexibility in the face of specific materials

shortages. In the long run, substitution is a principal means of coping with shortages.

The Paley Commission in 1952, the National

Materials Board in 1972, and others have recommended greater design efficiency and substitutability. However, Government implementation policies have been proposed only in general terms

such as “tax policy” and international standards.

The options available for harnessing materials substitutions as an instrument of national policy warrant further investigation.

Substitutions are a strategy selected by management to fit conditions of technical desirability,

especially in product performance; efficiency of

operations; and price or availability. Evidence suggests that price is usually not the most critical factor. One industry representative has noted that

material costs represent only 5 percent or less of

the final product cost of an aircraft, although it may

be responsible for 75 percent of Iifecycle costs.

Thus, Government taxing or price control can only

be effective in major applications for mature industries in which small cost differences exert considerable materials selection leverage.

Some have suggested designers and manufacturers make materials choices on the basis of “true

relative value” rather than cost. This “true relative

value” could include disposal costs and long-term

marginal costs of replacement. These policies

would not lead to greater materials substitution

flexibility because the true relative value is an

average market price, not a reflection of the uncertainty of supply and limitations of capacity during

periods of high demand.

Discovering the available substitution options is

in part a product of Government-sponsored R&D.

This should be done within the industries where

substitutions would be desired based on high-volume usage. Congress could establish a research
Ch. VII—Preliminary Policy Considerations ● 93

program to develop practical substitutes for critical

materials, with particular emphasis on products

with high metal use, nonmetallic coatings for corrosion and wear resistance, and dissipative uses.

This would encourage additional private sector

R&D.

Improve Product Aftermarket

Product remanufacturing, reuse, and repair (collectively known as product recycling) offer the

greatest leverage for saving materials and energy.

Improved aftermarket (the market for recycled

products) would prevent the mixing of scarce materials with the landfill waste stream as well as improve the recovery of the major metals—iron,

steel, aluminum, and copper. The aftermarket

changes that could improve efficiency resemble

vertical integration in their managerial and technological efficiency but do not necessarily lead to centralized control. For example, the following trends

are toward vertical integration in the aftermarket

but not by new product manufacturers: the growth

of automotive jobbers and mass merchandisers in

repair markets, greater leasing of products (new or

used) by retail outlets, more efficient diagnostic

and rework procedures in support of these integrated service groups, and greater willingness to

offer guarantees on reworked products.

Improved product recycling to capture the residual value in products through a strengthened aftermarket would eventually have implications for the

entire materials cycle. Table 40 systematically

enumerates the functional requirements that apply

to each step of the materials cycle, if recycling is to

increase. The table also lists the benefits to the Nation and stakeholder groups, the corresponding

disbenefits, possible Government options, and

likely impacts of implementing the options.

in all, there are 20 possible Government options

listed. Fifteen of these would dovetail with improved efficiency; eight directly support improvements in the aftermarket.

The results of this preliminary study of the product aftermarket indicate that four of these options

should receive primary consideration.

●

●

●

●

A

new

pact

jobs

Encourage product leasing through tax

deductions. —Tax deductions could be used

to provide an incentive for leasing of major

products, such as automobiles, appliances,

and machinery. At the end of the lease period, the products would be returned to the

supplier who would have product recycling

capability, rather than being discarded into

the waste stream.

Provide loans to establish aftermarket

business.—Low-cost loans could be provided to assist product recycling firms in attracting the necessary investment capital. At

present, most major products are discarded

rather than recycled, in large part because

very few firms are in the business of product

recycling.

Provide funding to establish a scrap inventory.-Another likely prerequisite to effective product recycling is improved information about the amount, form, and location

of residual scrap and its flow in the aftermarket. Funding could be allocated to establish a

scrap inventory for this purpose. See the

following section for further discussion of a

scrap inventory.

Increase public confidence in recycled

products.—Another major barrier to product recycling is lack of consumer acceptance

of used or remanufactured products. Government regulations (e. g., with regard to product

testing, labeling, specifications, and procurement) could be modified so as to increase

consumer confidence in the quality of recycled products.

direct substitution of recycled products for

ones would probably have a short-term imof reducing net jobs and replacing unskilled

with those requiring somewhat greater skill.

However, the long-term impact would be to increase consumer buying power and generate even

greater product flows and even more jobs in other

nonmanufacturing sectors. Engineering skills and

talent would have to shift toward the aftermarket.

Following this shift, unskilled employment opportunities would likely improve.

Product recycling would also save energy. As

shown earlier in figure 30, metal refining and fabricating are several times above the national average
94 ● Metal Losses and Conservation Options

Table 40.—lmplications and Impacts of Recycling on the Materials Cycle

Functional requirements

if recycling is to

be increased

Constant and rapid feedback of information between extraction of primary materials and recycling to assess scarcity and value of materials

I n order to adjust and

balance rate of depletion

and rigor of recycling.

Toxicity or other dangers

from primary materials,

which wiII eventually

enter recycling process,

must be understood and

tracked to avoid hazards

during reprocessing,

reuse, or disposal.

Application to national

goals; benefits to

stakeholder groups

Future needs and uses

protected, balanced

against today’s needs

and Iikelihood of future

technological development, substitutions, or

changes in usage/demand,

Occupational safety of

recycling, reprocessing

labor force and consumers; reduced IandfilI requirements, reduced environmental degradation.

Avoidance of irreversible

losses of materials

valuable i n the future

Disbenefits to

. stakeholders and

Nation

1. EXTRACTION

Errors in forecasting

supplies and shortages

have economic and security risks

Extraction industry

bears costs.

Government options,

role, and implemental ion strategies

Establish commission to

continually assess scarcity, provide feedback

between recycling and

extraction.

Rare materials which are

byproducts from extraction of other materials

must be preserved for

future use regardless of

current value (e. g.,

helium).

Il. PROCESSING, FABRICATION

EPA research and

Assure energy conservation benefits from using

recycled metal instead

of primary raw materials,

Trace element contamination of recycled materials may require modification of processing

equipment, new equipment, and/or higher

costs in processing.

Some modification in

fabrication.

Reduced energy costs in

production, reduced

energy sensitivity.

Better understanding of

true costs of small alloy

contamination in recycled materials,

Greater flexibility in

meeting materials

demands, reduced fluctuation in supply cycle

Coupling of materials industry energy needs to

availability of recyclable

materials.

Either reduced certainty

about materials quality

or Increased materials

testing.

Could lead to lower

quality primary materials

and higher production/

manufacturing costs

because some forming/

bonding applications

now require higher

quality.

Impacts of

implementing Government options

Competition between recycled and raw materials

may destabilize either or

both: who absorbs costs

of market variability?

Basic materials markets

standards develop- become more sensitive

ment for problem to Government policy

materials, tracking decisions regarding

through cycle. safety, forecasting

needs. and recycling.

Tax credit or other Increased capital resubsidy of differential quirement by industry.

costs of processing

equipment for handling Standards may restrain

contaminated/mixed re- materials development

cycled materials (invest- and innovation.

ment tax incentive?),

Joint sponsorship of

R&D for processes to

handle mixed/contaminated materials or to extract valuable trace

elements,

Procurement Incentives

for use of scrap,

Establish standard of

metal quality for recycle.

= Indirectly Improved efficiency of reworking, repair, and resale of products in the aftermarket

● = Directly supports improvements in the aftermarket activities

SOURCE Working Paper SIX.
Ch. VII—Preliminary Policy Considerations ● 9 5

Table 40.implications and Impacts of Recycling on the Materials Cycle—continued.

‘Government options,

role, and implemen tat ion strategies —

Impacts of

implementing Government options

Functional requirements

if recycling is to

be Increased

Application to national

goals; benefits to

stakeholder groups -.

Disbenefits to

stakeholders and

Nat ion— —

Ill. MANUFACTURING

I Government procurement standards favoring reuse/rehabilitation of products, components.

Repair industry is largely

captive of manufacturers; creation of new

conflicts of interest.

Modularize designs so

that components can be

replaced, refurbished, or

Interchanged.

Reduced costs for product/component repair or

replacement (consumer

satisfaction).

Without vertically integrated companies (or sophisticated purchasers),

additional design costs

are borne by manufacturers for good of the

repair industry.

Constraints on product

design may compromise

optimality of design in

terms of energy efficiency, substitution of materials, rates of innovation.

Design for ease of repair,

diagnostic evaluation,

and recycling.

Easier/less expensive

diagnostics, facilitate

do-it-yourself repair

● Establishment of standards for design and

repairability through officially designated

evaluation laboratories.

Higher priced new products due to higher resale

value compensates manufacturer but new and

used products compete

and tend to destabilize

the market for both.

Easier to meet specific

consumer/user needs

through modularization.

Build in diagnostic

checks and/or electronic

monitoring.

Economies of scale in

reliabiIity studies.

Develop production-line

compatibility with used

components.

Greater volatility in demand for new products if

buyer choice between

new/used products is

dependent on fluctuations in disposable income.

Market research on

reasons for discard/

replacement of nonobsolescent products.

Some additional constraints on design/

marketing decisions;

some reduction in consumer choice and convenience.

IV. DISTRIBUTION

Consumer’s control, independence, autonomy

reduced by leasing.

Share new product distribution system and outlets with recycled products, or devise new distribution systems/

outlets.

Create new small

business opportunities.

Distributor may be

caught in conflict of

interest: higher profits

on new goods than on

rehabilitated goods.

[ Review/revise ICC regulations on transportation rates; end

discrimination or

subsidize recycling.

Reduce costs of collection, transportation—

principal barriers to

recycling.

Prolonged product life

through better maintenance from leasing, or

reduced user care of

leased devices/vehicles.

● Encourage leasing

rather than sale of

products a through

tax advantages and

insurance protect ion

Better informed buyers

may gain advantages

over poorly educated

or poorly informed.

Use distribution system

for consumer in formation/education and for

collecting data on product failure/obsolescence

etc.

Improved relationships

between manufacturer,

selIer, buyer, repair industry.

Government leasing.

Buyers may be victimized by misrepresentat ion of recycled

products, components.

Issues of financial/

legal liability resulting from leasing.

● Government procurement through leasing

rather than purchase.

New customers for

Equitable transportation railroads, truckers.

costs for recycled tradeIn products from dealers. F1 Assistance to small

business to build distribution system and

outlets: guaranteed

loans, training, etc.

a

Leasing of vehicles large appliances, and equipment usually provides more systematic maintenance, greater intensity of utlization aggregated collection for eventual recycling, and

greater motlvation for recycling

—— Indirectly Improved efficiency of reworking, repair, and resale of products in the aftermarket

● = Directly supports Improvements in the aftermarket activities

SOURCE Working Paper SIX

51-680 0 - 79 - 8
96 ● Metal Losses and Conservation Options

Table 40.—lmplications and Impacts of Recycling on the Materials Cycle—continued.

Functional requirements

if recycling is to

be increased —

-.

Application to national

goals; benefits to

stakeholder groups

Disbenefits to

stakeholders and

Nation

V. USE AND REUSE

Government options,

role, and implemental ion strategies

Impacts of

Implementing Government options

Better information about

patterns of obsolescence, discard, etc.

Extended use, avoidance

of premature obsolescence.

More labor requirements, lower profits

for retailers.

I R&Don durability, safety.

Resistance from manufacturers/distributors,

wholesalers/retailers

[ Public education because of competition

Better knowledge of and persuasion.

durability, safety of

rehabilitated, resold

items.

Improved customer confidence in buying decisions.Possibly lower GNP due

to reduced markup between purchase of used

product and sale of reworked product; i.e., less

value added which mostly goes to wages.

New product manufacturers may move into

the aftermarket in competition with existing

repair/rework companies

or new part manufacturers; conversely aftermarket firms could

develop more sophisticated units and encroach on new product

manufacturing.

● Manpower training

for rebuild ing/reImproved discretionary habilitation.

Building of consumer income.

confidence through

standards, warranties,

labeling, etc.

● Development of diagnostic/repair techniques.

Less pressure on individuals and households for excess consumption.

Possibly reduced customer choice and satisfaction. ● Development of insurance warranty systems.

VI. DISPOSAL

Collection systems for

materials, products,

components.

Reduced municipal solid

waste disposal problem:

land and environmental

degradation, costs.

Esthetic/environmental

insults from collection,

sorting, transportation,

stockpiling (local).

Encouragement of

MSWb resource recovery

centers (technical aid).

(MSW centers) requires

changes in State laws/

constitutions; may undercut present secondary suppliers and destabilize prices; requires heavy State/

local investment in

rapidly evolving high

technology; requires

steady flow of waste,

may undercut longer

range conservation in initiatives; centers also

produce energy.

Sorting/evaluating systems for products and

components.

Disposal deposits based

on testing, lab evaluation of recyclability.

Preservation of items

of value

Inhibit substitution of

composite material,

special alloys, and complex designs because it

makes recycle more difficult.

Residual disposal

system.

Enhanced international

image.

Q Inventory of obsolete,

abandoned, discarded

materials (in large or

concentrated deposits)

available for recovery.

Product design for

easier recycle.

General encouragement

of prudence, conserving

society.

Knowledge of availability

and locational access to

obsolete discarded

material items.

● Requirement for manu -

facturers/distributors

to buy back.

Establish learning curve

for recovery of additional material under

increased scarcity.

Disposal charges promote roadside dumping

Disposal charges.

Deposits add to consumer prices, reduce

sales volume, high

administrative costs.

Reduced costs of retrieval through better information.

Inventory may undercut

scrap dealers basis

for business (knowledge of location and

accessibility y of material for recycle).

bMunicipal solid waste

= Indirectly improved efficiency of reworking, repair, and resale of products in the aftermarket

. = Directly supports improvements in the aftermarket activities.

SOURCE: Working Paper SIX.
Ch. VII—Preliminary Policy Considerations ● 97

in energy intensity. Therefore, recycling of metal

products and components—which involves the

maintenance and manufacturing stages of the

materials cycle—is more energy-efficient than

building products from scratch with newly mined,

refined, and fabricated metal parts.

In sum, improvement of the product aftermarket

would provide the institutional mechanism to

achieve many other important objectives such as

energy conservation and environmental protection, as well as contribute to materials conservation.

Establish Scrap Inventory

A complementary approach to recycling would

be to inventory the unused products or abandoned

materials available for recycling when needed.

Discarded products form a large reservoir of materials that has never been accounted for in detail.

Estimates of the magnitude of this resource have

been made, but to support recycling, the types of

metal and their location, physical accessibility, and

unit sites would be needed. A periodically updated

inventory might provide an ongoing assessment of

available resources sufficient to reduce the need

for direct Government action. The inventory

would also provide accurate estimates of true product life and reuse patterns. Many “obsolete” products are in fact acting as backup units or serving as

second systems (refrigerators and machine shop

lathes are clear examples of this).

The most valuable metals (other than common

steels) are found in specialized applications and

may or may not be accessible. By balancing the

books on obsolete products, one could: 1) determine the amount of accessible scrap (scrap that is

not corroded and within a reasonable distance of a

recycling center), 2) the flows of material products

in the aftermarket, 3) the reserves the Nation has

to fall back on in case of shortage, and 4) products

performing nonessential functions or materials

that could be removed from working products and

replaced with substitutes in the event of an emergency.

One objection to such an inventory of unused

products would be the high administrative cost of

the inventory, especially for materials not owned

by organizations with readily available inventory

records. Some form of sampling procedure would

be needed to obtain estimates and focus further

study to keep administrative cost down. Existing

scrap dealers might object to losing the proprietary

information needed to match sellers and their customers. New metal industries may feel their market would be undercut in the short-term, reducing

their capacity, but when the scrap ran out there

would not be enough capacity. Such instabilities or

overreaction would have to be eliminated.

Owners of the scrap might fear that proprietary

information would be released to competitors by

revealing the amount of material or equipment in

current inventory. The data base would need some

security protection; this would raise costs. If

owners of products lost some control over these

products—as in a recall during a materials

shortage—this would complicate the present owners’ planning for future needs.

Summary

The illustrative implementation options presented were selected so as to avoid Government

intervention in private decision processes to the

greatest extent possible. Instead, they enable the

private sector to more efficiently deal with their

own needs while reducing the uncertainties and

vulnerabilities for all parties. These means of implementation are to a great extent self-correcting.

They do not require constant Government adjustment of standards or regulations in order to

achieve a balance of interests.

These options were also selected so as to maximize the potential for reducing materials losses,

and to increase the adaptability, stability, and efficiency of the materials cycle.

The set of illustrative options discussed are

mutually reinforcing. The public data base supports all the other options. Contingency planning

primarily strengthens adaptability and stability.

The contingency shares certificate market would

moderate the extremes of tight materials markets

and diminish the frequently self-defeating responses of stakeholders during short-term crises.

Substitution is very much the result of a private

decision process, but it also can be an important
98 ● Metal Losses and Conservation Options

instrument of national materials and energy policy. Improvements in the aftermarket will contribute to greater efficiency but will also provide the

institutional mechanism to achieve many other

goals such as energy conservation and environmental protection.

These options if implemented would depend on

cooperative action by the private and public sectors. By initiating a private/public sector partnership now, when crisis conditions do not yet exist,

all parties could fully assess these and other options without the overriding pressure of emergency situations obscuring their underlying and longterm needs. Through such a partnership, options

like those illustrated in this section could strengthen the ability of the United States to avoid crisis

conditions in materials such as now exist with

regard to energy resources.
Appendixes

/ ’
Appendix A.—Proceedings of a Workshop on

Wear Control to Achieve Product Durability*

BACKGROUND

The Office of Technology Assessment, U.S. Wear control was chosen as an example of a

Congress, is analyzing the potential for materials technology which can increase product durability.

conservation in the manufacturing and use of Experts from the field of wear along with represenproducts. This assessment will determine at which tatives from industry discussed the status of wear

stages in the materials cycle materials can be con- control technology and its application in the design

served and the potential economic and other im- and maintenance of a range of products (railroad

pacts of such conservation. equipment, automobiles, aircraft, propulsion,

One possible strategy for conservation would

be to increase product life through improved corrosion, wear, and fracture control. To explore the

conservation potential of increased product life, a

workshop was held in Washington, D. C., on the

23rd, 24th, and 25th of February 1976. This document presents the proceedings of that workshop.

(See table A-1 for Agenda.)

naval aircraft structures, metal-cutting machinery

and tools, and heavy construction equipment).

*Excerpted from Martin J. Devine, Editor, Proceedings of a

Workshop on Wear Control to Achieve Product Durability,

1977, Analytical Rework/Service Life Project Office, Naval Air

Development Center, Warminister, Pa. 18974. The workshop

was sponsored by the Office of Technology Assessment, U.S.

Congress.

Table A-1 .—Agenda for the Workshop on Wear Reduction

(Sponsored by the Office of Technology Assessment, U.S. Congress, February 23-25, 1976)

Theme: “Materials Conservation—improved Product Durability by the-Application of Wear-Control Technology”

——-—

Morning Session, Monday, Feb. 23, 1976

Chairman— Dr. Elio Passaglia

Opening Remarks— Purpose

M.J. Devine

Office of Technology Assessment

Welcome

Emilio Q. Daddario, Director

Office of Technology Assessment

Materials Program Overview

A. E. Paladino

Office of Technology Assessment

Workshop Background

E. Passaglia

National Bureau of Standards

Session A.1

Session Chairman:

Dr. J. B. Wachtman, Jr.

National Bureau of Standards

Wear Technology

M. Peterson

Wear Sciences

Incentives for Longer Product Life

W. Flanagan

Center for Policy AIternatives

Massachusetts Institute of

Technology

Manufacturing Technology for Materials

Conservation

R. Matt

Aerojet General

Economic Factors in Product Durability

C. H. Madden/R. S. Landry

Chamber of Commerce of the United

States —. —

SOURCE: OTA.

Technology for Estimating Product Advanced-Research Projects Agency

Durability Wear Program

J. John E. Van RuethlR. Miller

IRT Corporation Advanced Research Projects Office

Financial and Taxation lmplication of Office of Naval Research

Equipment Replacement

P. Lerman

Fairleigh-Dickinson

Safety Aspects of Improved Product

Durability

H. Azzam

Interrad Corporation

Automobile Durability

D. Barrett

Ford Motor Company

Economic impact of Tribology (U.K.

Experience)

D. Scott

National Engineering Laboratory/

Wear Publications

Improved Product Durability Navy

Program

A. Koury

Naval Air Systems Command

Bell Systems Wear Control Program

G. Kitchen

Bell Laboratories

Life-Cycle Costing

T. Brennan

Naval Air Development Center

National Science Foundation

Tribology Program

M. Gaus

National Science Foundation

— ————

Maintenance Improvements Within the

Airlines

T. Matteson

United Airlines

Session A-2 (Evening)

ASME Wear Control Handbook

W. Wirier

Georgia Institute of Technology

ASLE Replacement Costs Survey

R.L. Johnston

Rensselaer Polytechnic Institute

ASTM Wear Program

K.C. Ludema

University of Michigan

MFPG— Wear Control

1.

2.

3.

4.

5.

6.

E. Klaus

Pennsylvania State University

Session B—Seminars

Automobiles/automobiIe spare parts

Naval aircraft structures/

materials/components

Aircraft/aircraft propulsion systems

Metal cutting machinery and tools

Railroad rolling stock

Construction equipment

a. Track-laying tractors

b. Rubber-tired earth-moving equipment —

101
102 ● Metal Losses and Conservation Options

The workshop explored whether product life and 4) the methodology and information available.

could be extended by improved wear control and The fact that only a few products were studied what would be the cost and other consequences of limits the conclusions. However, these products such extension. These questions were explored

from various viewpoints: 1) the status of technol- are sufficiently representative of a cross section of

ogy to support increases in durability, 2) economic industry so that the question of product durability

could, indeed, be qualitatively explored. considerations, 3) current policies and programs,

FINDINGS

Methodology of Economic Appraisal

A large amount of economic data was presented

at the workshop establishing that the real cost of

wear can be evaluated for a range of products

and/or industries. Such information is essential to

judge the need for and the significance of new

technology.

No standard techniques for acquiring the real

costs of wear are available. It is not apparent that a

standard technique would suffice; each product

might require its own separate analysis.

Standard methodologies are available for economic appraisals, and these could be applied to

wear, corrosion, or any other degradation process.

Some illustrative procedures are: 1) National

Association of Corrosion Engineers (NACE) standards for corrosion economies, and 2) lifecycle

costing.

Wear Costs and Consequences

It is clear from information provided during the

presentations and seminars of the workshop that:

1) data on the cost of wear in several different

product areas are available, and 2) that cost appraisal standards or techniques have been developed for this purpose. As expected, the greater part

of this information is available from Government

sources. However, further contacts with representatives from other product sectors are expected to

yield additional cost data.

At the workshop, examples of specific cost data

were presented. These data, if shown to be generally applicable, would in themselves provide

strong economic incentives for improved product

durability and therefore, for increased materials

conservation. It is recommended that such data be

collected. A major data source would be the military, which retains computerized malfunction

maintenance records. Some examples of specific

cost

●

●

●

It

data discussed at the workshop include:

Data on Wear Costs in Naval Aircraft.

Data provided on the wear costs in naval aircraft show that the scheduled maintenance

for wear for one aircraft amounted to $67 per

flight hour, unscheduled maintenance $140

per flight hour, and overhaul $36.87 per flight

hour. Thus, the total cost of wear is $243.87

per flight hour. This can be compared with

the cost of fuel of $376 per flight hour. Data

was also provided on the lifecycle costing of

naval aircraft tires. The Navy uses 20,500

tires per year at a cost of $3.48 per landing for

a total yearly cost of $1,853,200.

Data on Wear Cost of Diesel Engines.

Data provided on the diesel engine maintenance and repair for 20 ships (120 engines)

indicated that wear costs were $38.92 per

ship per hour. Fuel costs were $75.00 per ship

hour.

Data on Wear Costs of Tools. The purchased cost of high-speed steel tools (U. S. A.)

was $470 million per year; carbide tools $435

million per year, It was also learned at the

workshop that the best estimates of the cost of

wear came from users rather than manufacturers of products. The relationship of these

costs to manufacturing design decisions was

not defined. However, where responsibility is

divided between the user and the manufacturers the chief concern of the latter is marketability with durability being an indirect

consideration.

is clear from the data presented that ignorance

as to the wear control costs a significant amount

not only from the resultant necessity to overdesign
Appendix A—Proceedings of a Workshop on Wear Control to Achieve Product Durability ● 103

but also from the discard of components. Another

important factor regarding wear costs was that few

product areas use lifecycle costing. And those

areas that do use lifecycle costing employ it only at

certain stages of decisionmaking. Also, there is little agreement as to how the appropriate interest

rate should be calculated in order to compare different development and procurement plans from

the present-worth point of view. Present high rates

of interest tilt decisions to labor-intensive rather

than capital-intensive projects, with a resulting loss

in concern for product durability and hence wear

control. The possibilities of technological obsolescence further aggravate the problem. Those responsible for development and procurement are

frequently career people who will move on and

whose current responsibility is to keep down

capital cost, not to assure succeeding low-cost

maintenance programs.

Thus, the above findings, which are but representative of the material that was covered during

the workshop, all point to the fact that wear considerations cannot be isolated from the other considerations that go into the design of consumer

products. Wear control simply does not appear to

be a primary goal anywhere. Since responsibility

for wear control changes hands as the product

changes hands during its lifecycle, lifecycle costing

will not be used. The heart of the analysis of wear

and wear programs, or the lack of them, lies in the

understanding of the objective functions of the producers and the consumers as well as the constraints under which they operate.

State of the Technology

It was pointed out at the workshop that tribology, the branch of science concerned chiefly

with improvements in wear control for greater

product durability, has not received sufficient attention in U.S. academic, industrial, and Government institutions. The benefits of increased emphasis have not been defined sufficiently by the

scientists involved. Further research in the field of

wear could result in improved techniques to control damage resulting from sources such as contamination, vibration, misalignment, etc. Thus, the

most pressing need is for a centralized source of information on wear control technology which can

be effectively used in product design.

At the same time, technology does not limit

product durability, since many newly developed

techniques are now currently used by industry. implementation of this technology in design and

maintenance varies from one product to another

and one industry to another and is generally

limited by many other factors such as cost-effectiveness.

At present, several professional and technical

societies sponsor activities which contribute to and

facilitate efforts to control wear. Some examples of

these societies are as follows:

●

●

●

●

American Society of Lubrication Engineers

(ASLE) documentation of wear and failure

costs;

American Society for Testing and Materials

(ASTM) Committee G-2 on erosion and wear;

Mechanical Failure Prevention Group (MFPG)

sponsored by the National Bureau of Standards; and

American Society of Mechanical Engineers

(ASME) Lubrication Division and Research

Committee on Lubrication.

Existing technology is shared by various

manufacturers or industries by communication

with each other through these societies.

It was also noted that support programs oriented

toward tribology and wear control are sponsored

by the National Science Foundation, the Advanced

Research Projects Agency of the Department of

Defense, the Office of Naval Research, the National

Bureau of Standards, and the National Aeronautics

and Space Administration.

Product Durability

Concise definitions of product durability are not

available; however, it relates both to the maximum

life achieved and the ability of the product to survive both normal and abnormal usage. High product durability appears desirable from the point of

view of reliability and materials conservation. In

practice this is usually achieved at a higher purchase price. Secondly, longer life products may

have a tendency to reduce the application of technical innovations.
104 ● Metal Losses and Conservation Options

The conclusions of this workshop indicate that

considerable improvement in the durability of

some products can be achieved if desired. The

question which ultimately must be answered is

whether increased durability is worth the added

costs to the consumer and whether it can be effectively achieved. Product durability is the prerogative of the consumer. It is available if he wants

and demands it.

During the workshop several different actions

were discussed which could lead to improved durability.

Industries with close working relationships

between manufacturer and user, e.g., the Bell

System and the heavy construction equipment industry, could provide an active feedback system yielding improved durability of

products.

Inspection requirements and inspection frequency may be utilized to achieve increased

useful life of products, e.g., based on data

from Sweden, and comparison of States in the

United States, with and without periodic

motor vehicle inspection (PMVI), median car

life was shown to be extended as a result of

PMVI programs.

At the workshop, active product-durability

programs were reported by the Navy Department. These programs, which have been designated the analytical-rework and service-life

programs (ARP), are concerned with: 1) reducing the cost of aircraft maintenance; 2) applying new technology to aircraft repairrework aimed at increasing service life and

improving performance/safety /quality; 3)

conducting the optimum strategy for a more

efficient application of materials and processes generated under ARP; and 4) increasing

component and product durability through

the application of the rapid and precise nondestructive inspection techniques (with the

minimum disassembly of components) currently available.

However, product life is often not limited by

product durability. For example, many products

are removed from service which still have some remaining useful life, Among the reasons for early

product retirement are: 1) cost of operation or

repair, 2) productivity or functionality, 3) esthetics,

4) accidents, 5) physical loss, and 6) style preferences. Nevertheless, the extent to which useful

product life can be extended without decreased

product durability is not known. The primary factors that can affect useful product life are: 1) use, 2)

environment, 3) maintenance, 4) procedures, 5)

personnel qualifications, 6) inherent durability, 7)

design, 8) manufacturing process, and 9) material

characteristics.

In addition, product durability is only one approach to materials conservation. Due consideration should be given to other approaches. At this

workshop, reducing materials wastage in manufacturing was frequently cited as one means of achieving materials conservation and should be investigated.

Capital and Labor

From the manufacturer’s point of view there are

many factors in the development of a product: performance, safety, development cost, schedule,

energy consumption, maintenance costs, first

costs, appearance, styling, and durability. These

factors must be balanced in such a way as to find

widespread consumer acceptance. Where durability has a high value to the consumer, that attribute

will be accentuated in the product. Even without

this demand, the manufacturer has compelling

reasons for maintaining high durability standards.

First and foremost, a good service record for durability helps to ensure that the customer will return.

This is particularly true for industrial consumers

who maintain detailed maintenance records and

perform component evaluations.

The manufacturers in general cannot design for

a given product life. However, they do know and

keep records of service problems (warranty or

otherwise) and strive to eliminate these. Where

there is a close working relationship between the

manufacturer and the user, more success and

greater durability result. However, the manufacturer is limited in this regard since he seldom has

information on the life of a product or a component based upon the service condition in which it

operates. Thus, it can be concluded that the acquisition and distribution of such data would provide
Appendix A—Proceedings of a Workshop on Wear Control to Achieve Product Durability ● 105

a necessary base to initiate the engineering development actions for achieving increased product

durability.

The results of this workshop suggest that it is

primarily the consumer who determines product

durability. First of all, in a free-market system,

products reflect consumer demands. Secondly, evidence presented at the workshop suggests that

many failures are service-related and that product

durability is often a function of the kind of usage

and maintenance it receives rather than its designrelated deficiencies. Market surveys have shown

that product durability is very high on the list of

customer wants. However, consumers are generally not willing to pay more for increased durability

and often when given the choice, they select the

lower cost, less durable items (e.g., power tools are

often made in different quality lines; even professionals often select lower cost quality). It was further pointed out at the workshop that even sophisticated corporate “buy” decisions of capital equipment are based on maximizing the immediate cash

flow (net present value computation) to the company. Thus, longer life at increased cost achieved

by greater durability will not be sufficient justification for purchase. The incentive to buy must be

lower operating or maintenance costs since these

directly influence cash flow.

Thus it seems clear, based on the conclusions of

this workshop, that one point of action for increased durability is the consumer, and two areas

of appropriate investigation concern maintenance

cost reductions and improved durability at equal

cost. Programs which identify and correct service

related malfunctions, for example, Navy’s ARP,

should be encouraged since they achieve the

above mentioned goals as well as provide reciprocal information to the manufacturer.

Another incentive for the consumer would be

the further acquisition of cost data. At this

workshop, wear costs were shown to be surprisingly high in a variety of product areas. The same can

undoubtedly be said for corrosion, fatigue, and

other durability factors. If consumers realized

these costs, they might be prompted to take remedial action. It was also pointed out at the workshop

that there are acceptable techniques (e.g., cost

modeling, economic system analysis) for both

assessing durability (wear) costs and in determining how changes in durability would result in

system cost savings for a number of products.

The Lifecycle

Product life is not a clear concept. As an individual product reaches the end of its useful life (as

determined by its owner), it is not necessarily

scrapped. A product may be reconditioned or rebuilt. Or, when a product is finally considered unusable, it may be used as a spare part for a similar

model. Thus, it is possible to recycle parts as well

as materials. It was also learned at the workshop

that scrapped products and components could not

be considered waste. For example, the majority of

workshop participants felt that for those products

considered, the recycling of materials reached 80

to 90 percent. Thus, while recycling can sometimes result in a combination of materials having

different properties, it cannot be considered waste.

Furthermore, scrapped products often find value

as completely different products.

It should also be noted that the workshop participants expressed one area of concern regarding

product life. It was reported that inventories for

spare parts often reach a high of 20 to 1. Such an

excess in inventory could cause severe economic

loss. It was decided that this subject should receive

careful consideration in the final assessment on

materials conservation.

Materials Wastage

It was also found at the workshop that except for

spare parts, wastage due to poor product durability

seemed small for those products considered. Those

products that do not enter the spare parts inventory are often recycled. And, as the supply of material decreases, one would expect more use of

spares and more recycling. It was felt by the workshop participants that specific areas of possible

wastage should be identified and corrections

should be made when possible.
106 ● Metal Losses and Conservation Options

Significance for Research

Although this workshop was called to explore

the questions of wear, product durability, and

materials conservation, certain implications for

research become obvious when that work is taken

in its broadest context. A great proportion of the

research undertaken in this country has been related to innovation, that is, finding new ways to accomplish a stated objective. Composite materials

are a good example of this type of research. Much

less attention has been devoted to disciplines such

as wear, mechanical failures, corrosion, fatigue,

etc., which affect our knowledge of such factors.

It is clear from the results of this workshop that

the wearing of materials produces significant costs

in the overall materials cycle. And even more particularly, wear degrades performance so that much

of the original value of the product is lost. An emphasis on wear research, particularly those studies

which emphasize predicitve capability, would be

desirable. This emphasis need not be limited only

to wear but to all life-limiting technologies. Product

durability and life prediction are basically the same

concept and increased durability will not be attainable without better concepts of component life.

Improved knowledge of component life and the

factors which affect it would not only lead to improved durability but allow tradeoff decisions to be

made relative to such factors as materials conservation, lifecycle costs, reimbursement for defective

products, maintenance costs, net value, and depreciation. At the present time, these are largely

guesses.

Life prediction need not be a priori. Diagnostic

techniques such as those being used on naval aircraft should be further developed. Estimates of

product life remaining allow “use” decisions to be

made which result in longer life and improved

utilization. Research emphasis on this subject

could lead to considerable improvements in materials utilization.

A greater priority could be given to research that

extends product life. That is,

1.

2.

3.

4

Improved research and knowledge on what

malfunctions actually limit product service

life.

Increased research on those technologies

responsible for life determination such as

wear, fatigue, etc.

Increased support of research that allows

estimates or predictions to be made of product

and component life.

Expanded research on the subject of

diagnostic instrumentation that will allow

residual life estimates to be made.
Appendix B.— Conservation in World War II: 1933-45

INTRODUCTION

Over 35 years ago, the United States had to

mobilize for a global war. The demand for war

material such as aircraft, ammunition, ships, and

tanks, plus the loss of foreign sources of supply,

created threats of shortages for materials such as:

aluminum, chromium, copper, iron and steel,

manganese, nickel, tungsten, and others. Strong

production and conservation measures had to be

established to meet the threats of shortage. This

appendix examines the production and conservation strategies and their implementation, and the

technical and institutional impediments and associated impacts. This appendix is developed in a

scenario format to allow for easy comparisons with

future scenarios of materials shortages, and is

based primarily on information from the historical

publication Industrial Mobilization for War, Vol. I,

Program and Administration, Bureau of Demobilization, U.S. Civilian Production Administration

(1947).

ELEMENTS OF THE WORLD WAR II SCENARIO

Table B-1 provides basic information describing

the World War 11 period. War production rose from

2 percent of total output in 1939 to 40 percent of

total output in 1943 and 1944, as shown in figure

B-1. Expansion of total output was so great that

consumer purchases of goods increased by 12 percent. The impact of the war on civilians, in spite of

the human misery, was an economic improvement

over the great depression.

Strategic and Critical Materials

Table B-2 lists the materials “strategic” to the

Nation’s military needs in World War 11. Listed as

“critical” are other materials that were less difficult

to procure than the strategic materials. Table B-3

shows the materials stockpiled just before the war

erupted.

Military Requirements for

Selected Materials

Table B-4 list the maximum percentages of

selected materials allocated to military and foreign

requirements. Although 90 percent of the aluminum was used to meet military and foreign demands, sufficient capacity was reached in 1943 to

make aluminum more generally available than it

was before the war. The high use of copper for the

military did not seriously harm the civilian sector,

although supply fluctuations were a source of irritation. Originally, drastic cuts for iron and steel

were proposed in the civilian sector, but the actual

maximum amount used by the military never exceeded 57 percent.

National Objectives and Policies

The general war objective was to supply the

United States and its allies with war materials as a

first priority. Second priority went to basic civilian

needs for public services, food, clothing, and

health care. The remainder went to other civilian

consumer needs. Table B-5 lists major national objectives based on the January 1942 Address of the

President. For comparison purposes, the actual

production of munitions in 1945 dollars for the war

period is shown in table B-6. Table B-7 describes

the production of selected materials prior to 1942.

At the beginning of the war in 1942, expansion of

production capacity was of greater importance

than conservation.

107
108 ● Metal Losses and Conservation Options

Table B-1 .—Elements of the World War II Scenario

Elements Remarks

Overall economic

conditions. . . . . . . . . .

Availability of materials,

Energy . . . . . . . . . . . . . . .

Weather/climate. . . . . . .

Labor . . . . . . . . . . . . . . . .

Patterns of social values

GNP . . . . . . . . . . . . . . . . .

Inflation. . . . . . . . . . . . . .

Interest rates. . . . . . . . . .

Population. . . . . . . . . . . .

Population distribution

Concentration of

businesses . . . . . . . . .

Leisure and recreation. .

Recent turnaround from the Great

Depression.

Critical (see table B-2).

Generally abundant except for

100-octane gasoline.

Favorable (some droughts affected hydroelectric power supply).

Full employment, labor scarce.

Strong group achievement efforts

to meet war needs.

(See figure B-1.)

Inflationary pressures held down

by price controls with some twotier pricing.

Low-rate Government financing

(60-percent private financing).

137,000,000.

Northeastern States concentration.

Northeastern States with emerging aircraft industry on the West

Coast.

Limited by long work weeks and

military service.

Crime. . . . . . . . . . . . . . . . Limited by high employment and

military service.

Elements Remarks

Domestic policies. . . . . . Recently established social security and labor laws. Isolationist

pressures before the war were

followed by strong war emphasis

with attempts to maintain civiIian

democratic relationships in war

production efforts.

Environment concern. . . Little concern, smoke, etc., meant

product ion.

Education trends . . . . . . Crash training programs in warrelated areas. Education for veterans followed the War.

Technology trends . . . . . Steel industry was healthy before

the War. Synthetic rubber was in

pilot plant status. War needs

spurred innovation. Atomic

energy unleashed. Radar introduced and expanded. Basic

materials industries generally expanded with known technology.

Foreign relationships. . . Strong ties with England to supply

war goods. Conquest of friendly

countries changed supply relationships. Russia became an ally.

SOURCE: OTA, based on data supplied from Civilian Product Ion Administration

Figure B-1.— Gross National Product, World War II

[Total output of goods and services]

Annual Rate - Adjusted for seasonal variation and for

changes in the price level.

Non war Gov’t. War outlays

expenditures

4

I I I Consumer expenditures

1939 1940 1941 1942 1943 1944 1945

SOURCE: Civilian Production Administration.
Appendix B—Conservation in World War II: 1933-45 ● 109

Table B-2.—Strategic and Critical Materials

(World War II)

Strategic (essential to defense)

Aluminum for aircraft

Copper for ammunition

Carbon steel for weapons

Alloys steel for weapons

Also: Antimony, chromium, manganese, coconut shell char,

manila fiber, mercury, mica, nickel, quartz crystal,

quinine, silk, tin, tungsten

Critical” (less difficult to procure but essential

to the Nation)

Steel in the form of shapes, plate, tubing rail, shell, tin plate

Zinc

Aluminum (other than aircraft purposes)

Magnesium

Copper (other than for ammunition purposes)

Brass

Bronze

Tin

Nickel

Rubber

Also: asbestos, cork, graphite, hides, iodine, kapok, opium,

optical glass, phenol platinum, tanning materials,

tolunol, vanadium, wool

“

-Conservation controls were Imposed on all materials critical enough to war.

rant stockpiling

SOURCE: OTA, based on data supplied from Civilian Product Ion Administration

Table B-3.—Status of Government Stockpiles

(12/27/41)

Percent of

objective on

Commodity Objective hand 12/27/41

Metals and minerals

Antimony . ..............27,000 short tons

Beryllium ore . ...........3,000 metric tons

Cadmium. . ..............6,000 short tons

Chrome ore. . ............1,950,000 long tons

Cobalt . .................2,500 short tons

Iridium. . . . . . . . . . . . . . . . . . 7,750 troy ounces

Lead. . ..................200,000 short tons

Manganese ore. . .........3,300,000 long tons

Mercury. . ...............25,500 flasks

Tin . . . . . . . . . . . . . . . . . . . . . 207,434 long tons

Tungsten ore . ...........27,209 short tons

Zinc concentrates . .......150,000 short tons

Asbestos. . ..............30,700 short tons

Corundum ore . . . . . . . . . . . 3,000 long tons

Diamonds, industrial . .....6,410,000 carats

Graphite . ...............34,000 short tons

Kyanite . ................3,000 short tons

Mica. . ..................13,850 short tons

Nitrate of soda . ..........300,000 short tons

Quartz crystals. . .........702,000 pounds

Miscellaneous

Rubber. . . . . . . . . . . . . . . . . . 1,200,000 long tons

aStored in Chile

29

0

1

16

0

0

9

16

25

24

28

59

2

0

13

1

0

20

67a

?b

30

bConsiderable quantity delivered, but not yet tested against Government specifications.

SOURCE: WPB Dec. 30, Feb 24, 1942, file 025

Table B-4.—Supply to the Military and Relevant Materials Policies

Maximum percent to

Material

Aluminum . . . . . . . . . . . . . . .

military and export

90

Copper . . . . . . . . . . . . . . . . .

Iron and steel . . . . . . . . . . . .

Alloy materials:

Chromium. . . . . . . . . . . . .

Manganese. . . . . . . . .

Nickel . . . . . . . . . . . . . .

Tungsten, . . . . . . . . . . . . .

90

57

60

Same as steel

Approximately all to

military

Same as steel

Relevant materials policies

Policy of production expansion solved basic supply problem

by 1943 with some remaining shortages in shapes and

forms.

Policy of heavy foreign purchases from South America. Little

U.S. expansion made until a premium price system established. Erratic supply problems.

Policy of expansion relieved shortages later in the war with a

30-percent increase in capacity.

Policy to buy as much ore as possible from all sources.

Domestic low-grade production established as an insurance

policy, but less than 2 percent of that produced was used.

Policy of stockpiling worked well with l-year supply available

throughout the war. Manganese was used as a substitute for

more critical materials. Conservation attention only to highgrade ores.

Policy of strict conservation controls on use and distribution. Overconfidence in Canadian supply resulted in early

shortages. Substitutions, leaner alloys, and recycling improved materials flow.

Policy of expansion in domestic mining plus price supports

and assistance to foreign producers. Miscalculations resulted in excess of supply and inventory surpluses at the

end of the war.

Policy of expansion of synthetic rubber production as 90

percent of natural rubber was unavailable.

Rubber. . . . . . . . . . . . . . . . 60

Other important metals not included in the chart: magnesium, cobalt, molybdenum, vanadium; an important fuel was 100-

octane gasoline.

SOURCE: OTA, based on data supplied from Civilian Production Administration
110 ● Metal Losses and Conservation Options

Table B-5.—National Objectives (1942), Presidential Goals

1. To increase our production rate of airplanes so rapidly 3. To increase our production rate of antiaircraft guns so

that in this year, 1942, we shall produce 60,000 planes, rapidly that in this year, 1942, we shall produce 20,000 of

10,000 more than the goal set a year and a half ago. This them; and to continue that increase so that next year,

includes 45,000 combat planes—bombers, dive bombers, 1943, we shall produce 35,000 antiaircraft guns.

pursuit planes. The rate of increase will be continued so 4. To increase our production rate of merchant ships so rapthat next year, 1943, we shall produce 125,000 airplanes, idly that in this year, 1942, we shall build 8 million dead- including 100,000 combat planes. weight tons as compared with a 1941 production of 1.1

2. To increase our production rate of tanks so rapidly that in mill ion. We shall continue that increase so that next year,

this year, 1942, we shall produce 45,000 tanks; and to con- 1943, we shall build 10 million tons.

tinue that increase so that next year, 1943, we shall produce 75,000 tanks.

SOURCE: 77th Cong., 2d sess , Address of the President of the United States, H. Doc. 501, pp. 3-4, Jan, 6, 1942

Table B-6.–Munitions Production by Type (July 1940 to August 1945)

(in millions of standard 1945 munitions dollars)

1940 1945

(July- (January- Percent

Item December) 1941 1942 1943 1944 August) Total of total

Munitions totala

. . . . . . . . . . . . . . . . . 2,047 8,442 30,168 51,745 57.594 33,153 183.149 100.0

Aircraft . . . . . . . . . . . . . . . . . . . . . . . . 370 1,804 5,817 12,514 16,047 8,279 44,831 24.5

Ships. . . . . . . . . . . . . . . . . . . . . . . . . . 391 1,852 6,957 12,498 13,429 6,011 41,138 22.5

Guns and fire control . . . . . . . . . . . . 78 355 1,794 3,180 2,926 1,471 9,804 5.3

Ammunition . . . . . . . . . . . . . . . . . . . . 87 427 2,743 4,908 5,768 4,173 18,106 9.9

Combat and motor vehicles . . . . . . . 238 1,285 4,778 5,926 4,951 3,138 20,316 11.1

Communicant ion and electronic

equipment . . . . . . . . . . . . . . . . . . . 27 226 1,512 3,043 3,739 2,212 10,759 5.9

Other equipment and supplies. . . . . 856 2,493 6,567 9,676 10,734 7,869 38,195 20.8

aExcludes net increases in naval stock fund value of goods in store and stock in transit between supply offices, as follows: July-December 1940 (28); 1941 (194); 1942

(320); 1943 (613); 1944 (148); 1945(68); cumulative, July 1940-August 1945 (1,326)

SOURCE: War Production Board, Program and Statistics Bureau,

Table B-7.–Production of Selected Metals (July 1940 to December 1941)

Third Fourth First Second Third Fourth

quarter quarter quarter quarter quarter

Metal Total 1940

quarter

1940 1941 1941 1941 1941

Aluminum (thousand pounds) . 848,254 108,390a 121 ,553a 127,085b

147,888b

164,939b

178,399b

Copper (tons). . . . . . . . . . . . . . . 1,596,750 254,089 276,394 282,816 267,637 253,858 261,356

Lead (tons) . . . . . . . . . . . . . . . . . 954,971 143,651 176,432 177,782 164,819 145,049 147,238

Steel (tons). . . . . . . . . . . . . . . . . 120,416,094 17,967,529 19,609,306 20,277,275 20,592,070 20,622,050 21,347,864

Zinc (tons) . . . . . . . . . . . . . . . . . 1,120,050 178,620 190,154 186,604 188,277 188,198 188,197

aLetter J. L._ Honey to G. C Bateman, Apr. 29, 1941, file 523.4.

bReport "The Aluminum situation, ” table Vll, files 523.01 and 523.4.

SOURCE. Metal Statistics, 1945, New York: American Metal Market, 1946, except where otherwise noted.
Appendix B—Conservation in World Warn: 1933-45 . 111

CONSERVATION APPROACHES

Figure B-2 presents a schematic flow of conservation policy in World War II. Although the policies varied as the war emerged, peaked, and subsided, the general conservation policy was centralized Government control of materials supply and

production in the basic framework of a private enterprise system. Conservation was just one tool

among several for meeting the objectives of supplying the United States and its allies with needed

goods for war as well as providing basic needs for

the civilian sector. The prominent conservation

options implemented were substitution, simplification and standardization, curtailment, and salvage.

Conservation options such as design efficiency,

life extension of products, reducing exports, and

reducing dissipative uses were not given much attention because of the crisis conditions and lack of

leadtime and advance planning.

Figure B-2.—Conservation Policies During World War II

*

Policies

Centralized control of materials supply

& production in a private enterprise system

I

Conditions {

Threats

I

r strategies 3

World Expand

sourcing production

[ Stockpile 1I I t

1 I

I

Salvage 1

War Resources Board (1939)

Advisory Commission to the Council of

National Defense (1940)

[

Implementation Office of Production Management (1941)

War Production Board (1941-45)

(6,000 to 18,000 employed)

Civilian Production Administration (1945-47)

SOURCE OTA, based on data supplted from Cwlllan Production Admmtstrat(on

51-680 0 - 79 - 9
772 . #eta/ Losses and Conservation Options

Substitution

The largest substitution project in World War 11

was the substitution of synthetic rubber for natural

rubber. Ninety percent of the supplies of natural

rubber were cut off. Just before Pearl Harbor, the

synthetic rubber process was in a semiexperimental state. Six companies hoped to produce 10,000

tons by 1941. For war expansion, businessmen

estimated that each 100,000-ton requirement

would involve a 12- to 18-month leadtime and $50

million in costs. In 1942, a rubber “Czar” was

given production and conservation powers to increase production and meet supply requirements.

By early 1943, 241,000 long tons were produced.

By late 1943,850,000 long tons were produced. By

March 1944, 50 plants had been either built or converted to rubber production. Table B-8 shows the

estimated economics of the substitution of synthetic for natural rubber.

Conservation was emphasized in greater degrees as the war progressed and resources became

taxed to the utmost, In the early stages of the conservation program, substitution was the method

most commonly used. Excessively heavy demands

on certain materials, for which there was insufficient supply, frequently made substitution the

quickest and easiest way to relieve the problem.

Many of the substitutes used in these crisis times

proved unsatisfactory.

Three substitution methods were prominent: (a)

complete materials change, for example, steel cartridge cases substituted for brass cartridge cases,

(b) changes to reduce the use of the critical material, for example, substituting a different production

process, and (c) downgrading the same material for

the same product, for example, downgrading the

use of compositions in production of tube bushings.

Simplification and Standardization

Simplification was the elimination of items,

types, sizes, and colors of products that might hinder the flow of essential products in periods of

Table B-8.—Estimated Economics of Substitution

Material or product. . . . . . . . .

Make v. buy . . . . . . . . . . . . . . .

Required capital

investment. . . . . . . . . . . . . . .

Operating and

maintenance costs. . . . . . . .

Cost increase/decrease

due to the substitution. . . . .

Synthetic rubber for natural rubber World War II period.

The choice to buy was not possible because of the loss of Asian sources during

the war. Only 10 percent of the natural rubber supply was available.

Before the war, in 1940, the synthetic rubber process was in a semiexperimental

state requiring new process development including learning curve experiences

with input materials and operating characteristics. Existing capacity was 5,000

tons/yr. Six companies expected to have a combined capacity of 10,000 tons/yr by

1941.

Financial estimates were $50 million for providing each 100,000 ton/yr of

capacity with 12- to 18-month Ieadtimes.

Ultimate production desired was 877,000 long tons/yr including:

40,000 tons neoprene rubber (raised later to 60,000)

132,000 tons butyl-rubber

705,000 tons buna-S-rubber (raised later to 877,000)

In early 1943, there were 241,000 tons/yr. produced. In later 1943, there were

850,000 tons/yr. produced. By early 1944, the program was complete with 50

plants in operation.

Assuming $50 million/100,000 tons time approximately 1 million tons gives an

estimate of total expansion cost of one-half billion dollars (1945 dollars).

Assuming 50 plants were in operation with approximately 1,000 employees

estimated per plant making $3,000 per year, then the annual operating costs were

probably around $150 million per year.

Standard tire cost—Approximately the same to the buyer but he couldn’t get a

natural rubber tire.

Total cost of the synthetic rubber—The Defense Plant Corporation provided the

financing and the costs were subsidized making comparisons difficult.

Total cost to the customer—The cost is mixed because of the amount directly

paid does not include general taxes to the war effort.

SOURCE: OTA, based on data supplied from Civilian Production Administration
Appendix B— Conservation in World War II: 1933-45 ● 113

short supply. It was a means to break the wasteful

use of critical materials and facilities. It was also a

means to protect the buying public against excessively low quality. Standardization included building in the feature of interchangeability. As an example, through standardization, electrical indicating instruments could be transferred from one

combat vehicle to another with substantial increases in production and elimination of waste.

Simplification and standardization were not effective early in the war because of the hurried

startup production efforts. Around 1943, the production efforts smoothed sufficiently to allow the

refinements necessary to simplify and standardize.

The driving force for simplification and standardization was the taxing of nearly every type of

resource to the utmost, in order to meet the enormous war production goals and maximize facilities, manpower, and materials usage.

The Office of Civilian Requirements took the

leadership in establishing minimum standards of

essential consumer goods and limiting production

of higher priced luxury goods or unnecessary

models and sizes that were wasteful of scarce resources. Attention was given to: (a) the quantities

and types of goods and services needed by civilians; (b) the materials required to produce them;

and (c) the broad price ranges in which the bulk of

production would be sold.

Curtailment

In a war time mood, it was possible to have a

program of direct orders from Washington for conservation by curtailment. Curtailment involved

preference rating orders, allocation orders, conservation orders, limitation orders, and inventory

control.

a. Preference Rating Orders. The preference

rating order was a priority rating given to manufacturers whose products were vital to the defense

program, but entered only indirectly into military

items. Some examples of industries receiving

blanket preference ratings were building materials,

mining machinery, farm machinery, chemicals,

and health and medical supplies. Military production had an A-1 rating. The preference rating system was difficult to administer for two basic reasons: 1) quantities were not included in the ratings

and hence only A-1 really meant anything; and 2)

the paper work was excessive. Over 7,000 pieces

of mail came in each day, and applications arrived

at about twice the rate at which they could be processed.

b. Allocations. Allocations were a mandatory

form of distribution. Manufacturers were directed

to fill all defense orders in preference to nondefense uses. Rating provisions were included, but

went further toward actual allocation by requiring

that complete booking of orders be submitted once

a month from manufacturers. Nondefense uses

were divided into categories, and each was allowed

a quantity of metal equal to a percentage of an

amount used for the same purpose before the war.

Deliveries were contingent upon receipt of a sworn

statement of inventory and a sworn statement that

no other order had been placed with another supplier for metal for the same purpose. The system

did not work well because of the extensive paperwork involved.

The system later evolved into primarily focusing

on three key materials: 1) carbon and alloy steel, 2)

copper, and 3) aluminum.

Seven claimant agencies dealt directly with the

War Production Board: the War Department, the

Navy Department, the Maritime Commission, the

Aircraft Scheduling Unit, the Office of Lend Lease,

the Board of Economic Welfare, and the Office of

Civilian Supply. The claimants broke down their

requirements by major programs and related them

to monthly production schedules. Requirements

included not just raw materials, but also specific

forms and shapes. The requirements were earmarked as to programs for: production, construction, and maintenance. The sum of the materials

requirements of all the agencies were to make up

the total demand. On receiving their allotment,

each claimant agency had to bring its programs

and schedules into line with its allotment. Allotment numbers were then given to contractors and

were in effect a “certified check” to obtain materials needed.

c. Limitation Orders. These orders were curtailment directions to the civilian manufacturers to

limit the production or use of consumer goods and
114 . Metal Losses and Conservation Options

services. There were two reasons for the curtailment: 1) to add pressure on industry to convert to

war production, and 2) to conserve scarce materials. For example, a truck manufacturer would be

given assistance by the Government in getting

scarce material if the manufacturer would agree to

cut back on the amount of civilian vehicles producd. A percent of the average annual output of a

selected prewar period might be the quota set in

the limitation order. These limitation orders applied not only to manufactured goods like vehicles

and refrigerators, but also applied to energy conservation. Drought conditions, for example, reduced the amount of hydroelectric power for aluminum production. Limitation orders had to be issued to restrict electrical consumption.

d. Conservation Orders. These were orders

to eliminate scarce materials in products or to

reduce the amount of such natural use in products.

As an example, in order to conserve copper, the

use of copper in building construction was prohibited and specific articles containing copper

were given quotas based on 60 percent of previous

usage before the war. In the case of tool steels,

substitution compelled the use of molybdenum

alloying element in place of scarce tungsten alloying element.

e. Inventory Control Orders. Inventory control orders attempted to curb overbuying of materials and hoarding in anticipation of future scarcities. Under the orders, suppliers were forbidden

knowingly to deliver any of the named metals considered critical in amounts that would increase the

customer’s inventory for any calendar month beyond the quantity necessary. The basis for determining quantities was the customer’s usual method and rate of operation, and his required deliveries for products produced.

Salvage

The War Production Board had a Salvage Group

in its Conservation Division. The group conducted

campaigns for the salvage of cutting tools, cordage,

twine, fuel, and paper. Salvage was encouraged for

all critical materials. As the war began to wind

down, the Salvage Division watched only tin and

paper, which were still in short supply.

IMPLEMENTATION OF PRODUCTION

AND CONSERVATION POLICIES

The implementation of war production and conservation policies started slowly with limited contingency planning by advisers just before the war,

building into a super operating agency during the

war, and finally, shrinking to a demobilization

agency for peacetime preparations. At its peak,

6,000 to 18,000 people were directly engaged in

carrying out the national materials policies for the

war effort. In 1939, a War Resources Board consisting of Government, industry, and labor advisers attempted to determine possible wartime needs.

Through its efforts, a limited stockpile of material

was accumulated to meet contingencies. In 1940,

an attempt was made to create a stronger organization. Civilian isolationist pressures allowed only a

modest change with the establishment of an Advisory Commission to the Council of National Defense. This council had no single leader. Efforts

were geared at converting segments of industry to

producing war goods. Resistance was met from industry, labor, and local government, for example,

when curtailment of civilian automobile production hurt brisk sales.

In 1941, a stronger organization was formed

with two leaders, one from industry and one from

labor. The organization was called the Office of

Production Management (OPM). Large orders from

England were coming into the United States for

war goods when the lend-lease program was initiated. The OPM had to balance production for these

war goods against civilian requirements. Efforts

were aimed at increasing productive capacities and

building the stockpile. This organization had the

authority to apply priorities for needed materials

and goods.

After the war broke out in late-1941, the Nation

was in total war effort mood, and a centralized
Appendix B—Conservation in World War II: 1933-45 ● 115

superagency was established, called the War Pro- changed from a two front to a single front, presduction Board (WPB). By 1943, the superagency sures formed to eliminate WPB and reduce Govwas in firm control, and production and conserva- ernment controls. The Civilian Production Admintion procedures were fairly well established except istration replaced WPB and carried out the transifor conflicts concerning military estimates of tion task. The Civilian Production Administration

needs. Most of the discussions in this paper cover was finally phased out in 1947.

the activities and policies of WPB. After the war

IMPACTED STAKEHOLDERS AND THEIR RESPONSES

Table B-9 shows a selected listing of stakeholders and their problems in the World War II period.

The conflict between the military and the civilian

needs was the most prominent of stakeholder

problems. The civilian sector lost out to the military as the war approached. When the war was

ending, the civilian influence grew as evidenced

by the isolationist pressures on Congress and the

President to slow the shift to war production. An

example of military influence was the strength of

the Army-Navy Munitions Board in demanding

that its needs be given priorities during the heat of

the war. An example of reemerging civilian influence, as the war ended, was the pressures to let

price do the allocation rather than formal Government controls.

The second prominent stakeholder problem involved industry, which had to look to the superagency for its needed materials and product

quotas. Industry representatives were very vocal

about the delays, confusions, and contradictions of

the new Government bureaucracy. Special interest

groups in the industrial sector would also push for

gains that would put them in a favorable future

competitive position.

The third prominent stakeholder problem involved management and labor. Before the war,

labor had just accomplished a great deal of gains

through labor legislation and confrontations with

management. Labor was afraid that gains would be

lost under wartime emergency actions. The President and Congress were pressured to include both

labor and management people on the wartime

boards involved with materials policies.

The fourth prominent stakeholder problem involved the established executive agencies and the

wartime superagency. Overlapping of functions

and power caused confusions and strained relationships. As an example, both the Department of

the Interior and the Federal Power Commission

wanted more say in the development of hydroelectric sources.

England and the allies were also important

stakeholders that placed demands on the war

agency. Supplies had to be portioned out. England’s huge demands had to be reduced to a balance with U.S. needs. Russia’s needs had to be portioned in the light of possible collapse of that nation. South America had to have sufficient goods to

remain good neighbors. The War Production people in the United States did not always see the

global picture of resources and alternatives and

risks. As an example, British Empire resources

around the world were still available in many

cases and the English had to point this out to WPB.

Internal stakeholders emerged within WPB. The

field organizations differed with the central organization on how to work with industry. Often the

field groups were left confused without information or authority while having to meet the industrial user face to face.
116 . Metal Losses and Conservation Options

Table B-9.–Examples of Impacted Stakeholders and Their Responses (World War 11)

—.. — — ——

1942 . . . . . . . . .

1943, . . . . . . . .

1944 -45. . . . . . .

Stakeholders Nature or the problem Stakeholder responses Results Time period . — —

-. . . . . . . . . -. . . . . - . .

1939 . . . . . . . . .

1940 . . . . . . . . .

1941, . . . . . .

Military v. civilians

Industry v. antitrust units

Military v. civilians

Industry v. Govt.

production agency

U.S. v. foreign

Military v. civilians

Civilian v. Production

Agency

Interest groups v.

interest groups

Joint Chiefs of Staff

v. WPB

Free enterprise v.

Govt. control

interests

Amount of military influence

in production plans

Isolationist pressures

Firms reluctant to accept

defense contracts involving

negotiated

Consumers worried about

new priorities extended by

Congress

Overlapping functions by

new agency

Aid to England, Russia,

South America

Overlapping authorities

Appeals by civilians for

materials

Oil groups wanted rubber

from oil, Agriculture wanted

the synthetic rubber

from alcohol

Lack of production control

Pressures for allocation

by price v. Government

determination of need

industry delays

Consumer complaints

Pressures by industry for

less confusion

U.S. concern over loss of

vital goods

Production Agency disturbed over free hand of

the military

Civilian demand for democratic treatment

Interest groups pressure

on Congress

Inability of War Production

Board to validate military

claims for materials

Interagency arguments over

consumer quality and price

problems

Hesitancy of President to

establish War Resources

Admin.

Attorney General promises

freedom from prosecution

Vice President had to intervene

to resolve conflicts

Delays, contradictions

Lend-lease program and closer

foreign cooperation

Production agency reorganization but problem persists

Appeals Board established

Synthetic rubber made from

alcohol

Paper committee set up but

resolved. Dislocation in

materials flow.

Trends to decontrol as war

wound down. Reorganization

favored less Government

involvement

SOURCE: OTA, based on data supplied from Civilian Production Administration

SUMMARY 1939945

In the World War II period, there were four basic

conservation options: 1) substitution, 2) simplification and standardization, 3) curtailment, and 4) salvage. The major strategy for materials supply was

not conservation, but increased production. Other

materials supply strategies included stockpiling

and world sourcing.

Strategic materials were those essential to defense, including aluminum for aircraft, copper for

ammunition, and carbon and alloy steel for weap

ens. Critical materials were those less difficult to

procure but essential to the Nation.

Substitution was the conservation option used

first and most frequently. Many of the substitutes

used under crisis conditions were unsatisfactory.

Users were eager to return to the original material

or product. Three prominent substitution methods

were: 1) complete materials change,

reduce use of critical materials, and

ing the material for a given product.

Simplification and standardization

2) changes to

3) downgradwas a conservation-option that came later in the war as production began to smooth out and consumer demands

for better quality increased.

Curtailment was a conservation option involving

direct orders. The orders included: 1) preference

rating orders, 2) allocation orders, 3) conservation

orders, 4) limitation orders, and 5) inventory control.

Salvage was the recycling conservation option.

Recycling of steels became an important part of re-
Appendix B—Conservation in World War/l: 1933-45 117

ducing alloy element requirements later in the

war.

Implementation of production and conservation

policies was accomplished during World War 11 by

a new superagency called WPB. At its peak, 6,000

to 18,000 people were directly engaged in the activity.

In addition to the production and conservation

strategies, two additional strategies were applied:

1) stockpiling; and 2) world sourcing. Manganese

was stockpiled successfully with a l-year supply

available throughout the war. World sourcing of

minerals like chromium and tungsten ores provided sufficient needed material to make subeconomic mining in the United States questionable in

spite of foreign military occupations and hazardous

transportation problems.

Two general observations can be made concerning materials conservation. First, availability of

materials shifted in a short period of time, for example, steel was scarce and lumber abundant and

then the reverse occurred within a couple of years

as the war progressed. Policies had to be shifted

with the mood of the people, for example, the people would accept controls of a “Rubber Czar” during the heat of the war, yet they objected to Government intervention and leaned to private sector

allocation as the war was ending.
Appendix C.-- Conservation and Shortages: 1946-77

INTRODUCTION

In analyzing whether the occurrence of materials

shortages should affect the conservation of materials, one needs to look at all types of materials

shortages, both general and specific. As most materials experts will agree, there have only been two

major materials shortages of any duration from the

end of World War 11 through 1977: the Korean War

and the materials shortages occurring during

1973-74 (see figure C-l). However, at the same

time, experts in both the public and private sectors

note that interruptions in supply are constantly occurring on a short-term basis. As a result, industries are constantly having to adjust their supply

decisions regarding production needs, etc., due to

such factors as cartels, environmental regulations,

fiscal and monetary policies, capacity limitations,

and domestic and international demand pressures.

As illustrative of the types of materials shortages

that have occurred in the United States, the following discussion] examines the supply of seven

metals from 1946 to 1977. The metals that are examined include: aluminum, chromium, copper,

nickel, scrap, steel, and tungsten.

SHORTAGES IN ALUMINUM SUPPLY

1. Aluminum Supply in 1950-53. Aluminum

was in tight supply during this period as a result of

the Department of Defense (DOD) requirements

for the Korean War. Restrictions were placed on

civilian use of aluminum until 1953, and the percentage of aluminum use by the military increased

from 5 percent in 1950 to 28 percent in 1952.

During this period, the Government offered the

aluminum industry financial incentives to increase

production capacity. Under this program, 613,000

tons of new capacity were added between 1951

and 1954.

2. Aluminum Supply in 1966. During late

1965 and early 1966, aluminum supply was again

in tight supply due to an increase in military activities as a result of the Vietnam War. The DOD

requirements for aluminum increased from 2 percent in the second quarter of 1965 to 11 percent

I

The data for this appendix is based on the following

sources: (1) literature survey in the New York Times, Wall

Street Journal, and American Metal Market newspapers; (2)

working paper prepared by the Department of Commerce for

the National Commission on Supplies and Shortages on

“Shortages and Surpluses in Selected Commodities–1976;”

(3) report prepared by A. D. Little for the Department of Commerce entitled, Material Shortage Study; and (4) hearings held

by the Senate Government Operations Committee, August

1974, on Materials Shortages, The Industry Perception.

118

during the third period of 1966. A shortage situation was avoided by the release of aluminum from

the Government stockpile.

3. Aluminum Supply in 1972-74. During the

period 1972-74, aluminum was reported as being

one of the major metal shortages. In the survey

undertaken by the Senate Government Operations

Committee regarding the industry perceptions of

the materials shortages, 74 companies indicated

that they had experienced aluminum supply problems. The survey indicated that aluminum mill

products, for example, sheet, plate, rod, bar, tube,

extrusions, casting, foil, forgings, etc., were all in

short supply. The major problem the industries

were facing was an increase in demand and a static

supply of aluminum. An additional factor that affected production capacity was an electric power

shortage which occurred in the Pacific Northwest

in 1973. This shortage was responsible for reducing aluminum production capacity by 9.5 percent.

Other factors that aggravated aluminum production were: (a) the difficulties encountered in obtaining aluminum scrap and alumina catalysts from

foreign markets (due to very high prices); (b) the

unavailability of adequate metal and rolling capacity to produce aluminum foil; (c) the costs of compliance with environmental protection regulations;

and (d) price controls.
Appendix C—Conservation and Shortages 1946-77 ● 119

Figure C-1.— Metal Shortages 1939-77

1 [ r

1955

1956

1957

1958

1959

1960

1961

1962

1963

1964

1

--l

1968

1969

1970 I I

1971

7 —————— ————— -

1972 -––--–––––––_–_–-- — — —— ——

--- - ~:–~-~_:_:_:_ —-———_—— — — — ——-— —————————

1975

1976 --:-:-:–––––––––--

1977

= Shortages, specific

~ General shortage periods

SOURCE: OTA based on data from references cited in footnote 1 p 118

It was found that independent fabricators and

smaller customers were hit the hardest by the increase in prices, the shortages of selected types of

aluminum products, and the allocations instituted

by some producers and suppliers.

4. Aluminum Supply in 1975-77. At the

beginning of 1975, the demand for aluminum

dropped off due to the reduction of construction

jobs. In response to this reduction in demand,

aluminum producers began to curb their output. In

addition, the General Services Administration further aggravated the situation by releasing 15

million lbs of aluminum from the Government

stockpile. Thus, both the United States and Canada

further limited their production of aluminum.

In late 1975 and early 1976, demand for aluminum was on the rise. The construction industry

began to pick up, and the Ford Motor Company

decided to expand its output of cars. As a result of

these two factors, demand and increased supplies

began to tighten (a result of reduced capacity during 1975). The tight aluminum supply situation

was eased to a certain degree by the recycling of

aluminum cans during 1976.

Articles indicate that while some spot shortages

of aluminum occurred on the east coast due to unusually severe winter weather conditions, the

overall outlook for aluminum supplies remained

positive. However, it is possible that due to capacity limitations the production of aluminum might

have been bottlenecked as economic recovery continued.
120 ● Metal Losses and Conservation Options

SHORTAGES IN CHROMIUM SUPPLY

The United States is dependent on foreign

sources for its chromium requirements, either as

chromite or as ferrochromium. Up until 1968, the

United States imported a large amount of chromite.

However, in 1968, the United States shifted its importation of chromite to the importation of ferrochrome. One reason for this shift was the United

Nations sanction against Southern Rhodesia,

which was the U.S. principal supplier of chromite.

As a result, the United States shifted its dependence to the Soviet Union. While many companies

expressed the fear that raw materials might be cut

off from either Rhodesia or Russia—thus limiting

production—such a shortage did not materialize.

1. Copper Supply

lustrates the periods of

SHORTAGES IN COPPER

in 1946-71. Table C-1 ilsurplus and tight supply in

regard to copper and the major factors influencing

the supply from 1946-71.

Table C-1 .—Copper Supply

Period Incident —

1946-49 . .

1949 . . . . .

1950-53 . .

1954-56 . .

1957-58 .

1959 . . . . .

1960-64 . .

1965-68 . .

1969-71 . .

Tight supply

Excess supply

Relative balance

Tight supply

Excess supply

Tight supply

Relative balance

Tight supply

Relative balance

At the same time, however, another type of

shortage did occur during 1972-74. This shortage

related to the ability of the United States to produce

ferrochromium alloys at peak steel demand. Peak

demand was reached in 1973-74 and could be

reached again in any type of national emergency.

Thus, the shortage in regard to chromium results

not from the unavailability of the raw materials,

but rather from the inability to convert the ore to

ferrochromium alloys.2

2

The conversion problem stems from the availability of

electric furnaces. Apparently, industry switched its electric

furnaces from the production of ferrochromium alloys to

silicon ferroalloys, which are more profitable.

Influencing Factors

Strong post-World War II

demand and Government

action.

Weak demand.

Strong demand and

production. Government

price controls.

Strong demand and copper

strike.

Weak demand due to

recession.

Strike reduces available

supply.

Demand and supply

increase.

Strong demand. Government actions including

Vietnam War and 8-month

copper strike.

Supply able to keep pace

with demand.

2. Copper

considered to

SUPPLY

Supply in 1972-74. Copper was

be in short supply during 1972-74.

Sixty-two companies, as reported by the survey

undertaken by the Senate Government Operations

Committee on industry perceptions, indicated supply shortages. The reason most cited for the apparent shortage was an increase in world demand

combined with limited production capacity.

Other factors that were mentioned as producing

a tight supply situation included: (a) the exportation of domestic copper to foreign countries due to

higher prices overseas, (b) price controls, and (c)

the possibility of formation of a copper cartel that

would restrict the sale of copper to the United

States.

3. Copper Supply in 1975-77. Demand for

copper began to fall during the first quarter of 1974

and plunged in 1975 due to a worldwide recession.

As a result, copper production was cut back and

prices fell. However, by early 1977 an oversupply

of copper existed due to the very low level of demand.

SOURCE: Department of Commerce
Appendix C—Conservation and Shortages 1946-77 ● 121

SHORTAGES IN NICKEL SUPPLY

1. Nickel Supply in 1946-71. A primary

nickel shortage was experienced in the United

States from 1950 to 1957. This shortage was the

result of rationing by Canadian producers, from

which the United States imports about two-thirds

of its nickel. This rationing caused U.S. steel producers (nickel is used in the production of stainless

steel) to revert to the production of low-nickel

steels. The Government continued to buy metal for

defense stockpiles and placed nickel under allocation from August 15, 1951, to November 1953. The

nickel shortage was less severe in 1955 due to the

diversion of nickel, scheduled to be stockpiled, to

the consumer sector.

In 1958, supply .exceeded demand and nickel

producers reduced operating capacity. As a result,

the Government terminated all contracts for nickel

delivery, and DOD lifted all restrictions on the use

of nickel.

During 1964, a nickel shortage would

curred, due to an increase in demand for

have ocstainless

steel, except for the fact that the Government

released nickel from the strategic stockpile.

2. Nickel Supply in 1972-74. Nickel operations were fairly normal from 1972 through 1973.

However, in early 1974, the nickel supply began to

tighten due to a record consumption. In response

to the tight market, many companies began to import additional nickel from the U.S.S.R. Additional

responses to the demand/supply situation were

the allocation of metal by nickel producers and the

resistance by nickel producers to accept defenserelated orders from new customers. The major industry that was adversely affected by the tightened

supply of nickel during 1974 was the steel industry, that is, in the production of stainless steel.

3. Nickel Supply in 1975-77. Nickel was in

excess during this period due to weakened demand.

SHORTAGES IN SCRAP SUPPLY

Ferrous Scrap Supply From

1946 to 1971

1. Ferrous Scrap Supply From 1946 to

1949. Steel production steadily increased from

1946 through 1948, thus increasing the demand

for ferrous scrap. By 1948, ferrous scrap was in

short supply. Also, price controls were lifted on

November 10, 1946, thus allowing prices to rise.

A drive was begun by the Secretary of Commerce in November 1948 to assist in increasing

the flow of scrap. The program was terminated in

May 1949 as a result of an improved scrap situation. Also, imports of scrap during this period

helped to ease overall scrap supply.

(b) Ferrous Scrap Supply During 1950-53.

The demand for scrap increased during the Korean

War due to increased steel production. Purchased

scrap receipts increased between 1949 and 1950

by about 35 percent. Some spot shortages of scrap

caused the closing of some open-hearth furnaces in

early 1952. However, widespread closings of furnaces were averted due to the National Production

Authority allocation program and by the maintenance of adequate flow of scrap from processors.

(c) Ferrous Scrap Supply During 1955-57.

Ferrous scrap was in tight supply due to a record

increase in the production of steel during this

period. Also, scrap demand was especially high

due to large export volumes.

(d) Ferrous Scrap Supply During 1969-70.

Ferrous scrap again moved into a tight supply

situation due to an increase in steel production.

While steel production started to ease in 1970, exports increased the total scrap demand.
122 . Metal Losses and Conservation Options

Scrap Supply From 1972 to 1974

(a) Ferrous Scrap. Tight supply of ferrous

scrap is usually associated with a rising demand for

steel. When steel demand increases, so does the

price of scrap. Scrap prices are constantly changing, up and down, in response to changes in demand. A second factor that affects the supply and

price of ferrous scrap is export demand. And in

1973-74, a rapid increase in scrap exports took

place.

During 1972 and early 1973, the steel industry

began to recover from the severe recession of

1971. The demand for domestic steel increased

due to: (1) a lesser availability of foreign steel as a

result of the devaluation of the dollar,3 and (2) the

overall increase in worldwide demand. Thus, the

demand for U.S. domestic-steel and scrap sharply

increased both domestically and internationally

during this period.

Scrap prices began to increase and ranged from

$48 per ton in January 1973 to $55 at the end of

June, to a high of $81 per ton in November 1973.

Also, scrap prices were not only high, but in some

cases the supply of scrap was limited due to the exportation of scrap to foreign markets. Some small

scrap companies were able to export their scrap for

higher profits due to the fact that they were not affected by the wage/price control constraints. A further factor that aggravated the supply of scrap was

the shortage of gondola cars that are used to ship

the scrap to markets.

The situation was most serious in regard to the

availability of scrap on the west coast. This was

due to the large amounts of scrap being exported

in proportion to the supply of scrap available for

production.

(b) Aluminum Scrap. Aluminum scrap is the

prime raw material used in the production of secondary aluminum ingot.4 During this period, aluminum scrap was in short supply due to a number

of factors: (1) as the demand for primary aluminum

increased, so did the demand for aluminum scrap;

(2) more scrap was exported due to increased

worldwide demand and higher prices received for

scrap on the foreign market; and (3) scrap that was

normally available from fabricating plants of integrated producers was no longer offered for sale.

3Due to the devaluation of the dollar, domestic steel was

priced about 25 to 35 percent lower than foreign steel.

4

secondary ingot accounts for approximately 20 percent of

the total U.S. aluminum supplied.

SHORTAGES IN STEEL SUPPLY

1. Steel Supply in 1946-71. The period

following the end of World War 11 included periods

of peak steel demand with tight supply or shortages of steel and periods of weak demand at the

low point of the business cycle, as well as the more

normal demand periods. Steel was in tight or short

supply three times during 1946-71: (a) 1947-57

when the European and Japanese steel industries

were rebuilding, (b) 1959-60 caused by the 116-day

steel strike in the United States, and (c) 1969-70

due to a worldwide increase in steel demand.

2. Steel Supply in 1972-74. During the period

1972-74, one of the major shortages of materials

experienced by industry was steel. Approximately

106 companies indicated to the Senate Government Operations Committee in their survey on

“Industry Perceptions of Materials Shortages” that

they were having difficulty obtaining steel, that is,

stainless, castings, forgings, plate, sheet, and steel

products.

Major factors to the tight demand/supply situation included: (a) a lack of adequate steel production capacity to meet demand, (b) wage and price

controls, (c) a shortage of iron, and (d) an overall

increase in worldwide demand for steel.

3. Steel Supply in 1975-77. During the first

quarter of 1975, the demand for steel reached an

all-time low. As a result, the production of steel

was cut back drastically, However, by the end of

1975, the demand for steel began to improve, causing spot shortages to occur in various steel products. By the end of 1976, the demand/supply situation began to balance out.
123

Spot shortages also occurred in the availability quate fuel to operate the steel mills. However, as

of steel products during the first quarter of 1977 weather conditions began to ease, so did the tightdue to severe weather conditions and a lack of ade- ened steel supply.

SHORTAGES IN TUNGSTEN SUPPLY

During the materials

companies indicated to

Government Operations

shortages of 1972-74, two the lack of capacity. Factors influencing capacity,

the Senate Committee on as with other metals, were wage and price conthat tungsten was in short trols, environmental protection regulations, and

supply. The reason given for such a shortage was foreign competition.

SUMMARY 1946-77

From 1946 to 1977, interruptions in supply were

constantly occurring in regard to the seven metals

analyzed in this study. Factors affecting the supply

of such metals include: governmental regulations,

capacity limitation, direct raw materials shortages,

strikes, transportation disruptions, import limitations, unusual demand surges, and acts of nature,

for example, severe weather conditions. While a

tight supply situation can result solely from the

general fluctuations of the business cycle, the occurrence of supply disruptions adversely affecting

industry usually involves the combination of several factors, for example, unusual demand surges

combined with capacity limitations, and/or demand surges combined with direct raw materials

shortages.

Tight supply situations or actual disruptions in

supply occurred as follows: 1) aluminum was in

tight/short supply in 1950-53, 1966, 1972-74, and

early 1976; 2) ferrochromium alloys were insufficient to meet peak steel demand in 1973-74; 3)

copper was in tight/short supply in 1946-48,

1954-56, 1959, 1965-68, and 1972-74; 4) nickel

was in short supply during 1950-57, 1966, and

1974; 5) supply shortages were apparent in the

supply of scrap in 1948, 1952, 1955-57, 1969, and

1973-74; 6) steel was in short supply in 1947-57,

1959-60, 1969-70, 1972-74, and the first quarter of

1977; and 7) the supply of tungsten was interrupted during 1972-74.

The above facts indicate that tight/shortage

situations with regard to the seven metals constantly occurred over the past 38 years. Since the

factors that have combined to cause such supply

disruptions can reoccur, the probability of specific

shortage conditions in the future is quite high.

There is less certainty about the reoccurrence of

general non-war-related shortages.
Appendix D.—Glossary of Terms

Corrosion and Wear Losses-Metal that is lost

in the actual process of corrosion and wear

(e.g., the gradual wearing down of saw blades

or drills due to cutting friction) in the utilization

of products; does not include metal lost

because of a shortened product life due to corrosion and wear.

Dissipative Losses-Metal that is lost or consumed in use (e.g., used as catalysts and in

paints and fertilizers) or dispersed beyond practical recovery (paper clips, nails, etc.).

Excess Metal in the Material Cycle—Material

in use at each step in the material cycle that

could be eliminated through applications of

one or more conservation options.

Materials Cycle—The total flow of a material

from mining to its ultimate return to the Earth

(e.g., in landfills). Includes several steps or

stages: mining, ore processing, metal production, transportation and handling, product

manufacturing, distribution, use, storage, and

disposal.

Metal Conservation Options–A technique by

which metals can be conserved (their usage

reduced). Example include: substitution of one

material for another, prevention of losses in

manufacture, making products smaller or with

less metal, and recycling.

Metal Losses From the Materials Cycle—Residual metal from each step in the material cycle; examples include: the metal remaining in

the ore that is not recovered, the slags of

byproducts of metal processing, industrial

scrap from product manufacture, material

dispersed in use (e.g., pencil lead), and postconsumer waste.

Metal Processing Losses—Metal that is lost in

the conversion of ore to metal, usually in the

form of slags and dresses.

Metal Recycling-Recovering of metal from all

sources including used products.

Milling and Concentrating Losses-Metal that

is not recovered from the mined ore and remains in the mine “tailings.”

Nonmetallic Losses-Metal that is lost when the

ore is not actually converted to metal but is

used in nonmetallic applications, such as

abrasives, refractories, insulation, and

ceramics.

Product Manufacturing Losses-Metal that is

lost in the form of industrial scrap remaining

from the manufacture of products: examples

are chips, grinding dusts, unused metal, and

product rejects.

Postconsumer Waste-Metal that is lost in

household wastes discarded into the municipal

solid waste stream.

Product After Market-The business of product

recycling, resale, and reuse.

Product Recycling-All forms of recycling including metal recycling, product or component

rework or remanufacture, or product or component reuse.

Product Rework or Remanufacture-The

process by which an old product is restored to

a condition approaching or equaling its original

condition by replacing worn parts, cleaning,

and refinishing.

Substitution-The use of one material or metal

in place of another in a product or application.

Transportation and Handling Losses—Ore

that is lost in transit between the mine and the

mill.

Unrecovered (and Unknown) Material-Metal

that is lost due to lack of recycling; calculated

by subtracting the amount of scrap available

from obsolete products in a given year from the

amount actually recycled. The amount of scrap

available is based on the products manufactured in previous years and estimates of their

lifetimes.

Wastes-Metal losses or excess usage.

124
Appendix E.— List of Working Papers

Working Papers contain the complete texts of

six working papers prepared by contractors in

support of this assessment. The papers will be

available in the near future from the National

Technical Information Service (NTIS), Department

of Commerce, Springfield, Va. 22161. Please call

OTA’s Public Affairs Office on (202) 224-8996 for

NTIS availability and ordering information.

OTA staff have drawn heavily on these working

papers for data and analyses. Their public release

by OTA does not imply that OTA endorses the assumptions, data, findings, or conclusions of any of

the papers or their authors. Neither OTA nor its

contractors endorse specific named products, processes, or firms.

OTA wishes to acknowledge the considerable efforts of the staffs of Battelle Columbus Laboratories, The George Washington University, Rensselaer Polytechnic Institute, and Pugh Roberts

Associates, Inc., who cooperated in providing the

valuable data and analysis contained in the working papers.

Working Paper One

A Preliminary Assessment of Options for

Reducing Wastage of Materials, Volume II-A

by Battelle Columbus Laboratories

o

Working Paper Two

Flows of Selected Materials, 1974, Volume II-B

by Battelle Columbus Laboratories

Working Paper Three

Identification and Evaluation of Metal

Conservation Approaches for Products,

Volume II-C

by Rensselaer Polytechnic Institute

Working Paper Four

Alternative Methods for Implementing a

Recycling Policy, Volume II-D

by Battelle Columbus Laboratories

Working Paper Five

Analysis of the Impacts of Changing Product

Service Life and Material Content, Volume

II-E

by Pugh Roberts Associates, Inc.

Working Paper Six

Preliminary Technology Assessment of

Materials Conservation Strategies, Volume

II-F

by The George Washington University Program

of Policy Studies in Science and Technology

125