Survey finds asphalt producers among top recyclers in US
According to a recent national survey, asphalt mix producers reclaimed 97 million tons of old asphalt–enough to fill up the dome of the U.S. Capitol 1,223 times.
According to the latest industry survey by the National Asphalt Pavement Association (NAPA) in partnership with the Federal Highway Administration (FHWA), the pavement industry reclaimed 97 million tons of RAP for future use, saving about 58.9 million cubic yards, or enough landfill space to fill up the dome of the U.S. Capitol 1,223 times. This massive reclamation effort also saved $5.3 billion in gate fees for disposal in landfills.
"NAPA is proud to release the results of our annual Asphalt Pavement Industry Survey on Recycled Materials and Warm-Mix Asphalt Usage,” said NAPA Chairman James Winford Jr., president of Prairie Contractors Inc. in Opelousas, Louisiana. “This survey not only quantifies our industry’s commitment to recycling but also supports our objective to remaining the most recycled material in the nation. NAPA and its members are committed to building and maintaining our country’s infrastructure with the utmost goal of recycling, sustainability, and concern for our environment and resources while, at the same time, providing the travelling public with the smoothest, quietest, safest, and most perpetual pavement surface available."
Of the 97 million tons of RAP reclaimed, contractors reused 89.2 million tons in new asphalt pavements in 2019. This is a nearly 8.5 percent increase from the 2018 construction season and represents a nearly 59.3 percent increase from the total estimated tons of RAP used in 2009, when this annual survey was first conducted. For the first time, the survey evaluated greenhouse gas emissions, finding RAP usage saved 2.4 million metric tons of CO2e, the equivalent of removing 520,000 passenger vehicles from the road.
“Over the years, we’ve seen steady advancement in RAP use across the country. Through collaboration on research and applied best practices among industry engineers and road owners, we maintain or improve performance while increasing the use of recycled materials,” stated NAPA President and CEO Audrey Copeland.
Additional survey results show that asphalt producers used an estimated 921,000 tons of reclaimed asphalt shingles (RAS) in asphalt mixtures in 2019. RAS usage during the 2019 construction season is estimated to have reduced the need for 184,200 tons (more than 1 million barrels) of asphalt binder and about 460,000 tons of aggregate with a total estimated value of more than $103 million.
Other recycled materials commonly reported include recycled tire rubber, blast furnace slag, steel slag, cellulose fibers and fly ash. Fifty-two companies in 24 states reported nearly 1.3 million tons of these other recycled materials in the production of nearly 8.3 million tons of asphalt mixtures.
Asphalt mix producers also continue to make significant use of energy-saving warm-mix asphalt (WMA) technologies. In 2019, contractors used WMA technologies for the production of 164.5 million tons of asphalt mix. A number of environmental, worker safety, and construction benefits have been realized through the adoption of WMA technologies. Nearly half of the WMA production was at reduced temperatures decreasing the energy required to manufacture the mix. The most common WMA technology used is plant-based foaming, which injects a small amount of water into the asphalt binder during production.
NAPA collected survey responses over the first half of 2020. The report compiles results from 212 companies with 1,101 plants in 48 U.S. states, the District of Columbia, and one U.S. territory.
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MUFG cites sustained strength in waste sector
Financial firm says sector has proven resilient during COVID-19 pandemic.
The Environmental Services banking team at the New York office of Japan-based Mitsubishi UFJ Financial Group (MUFG) says despite a reduction in waste volumes during the COVID-19 pandemic, “the waste management industry has proven strong, with increasingly agile companies operating in what has historically been a resilient business.”
MUFG issued its perspective in concert with Climate Week—an annual summit on environmental and policy issues that took place in late September in New York City and other cities around the world.
The MUFG Environmental Services banking team includes Managing Director Robert Jones, Director Maria Maia and Vice President Fabio Lauro. The team is part of the wider MUFG organization, which describes itself as one of the world's largest financial institutions by assets, with approximately $3.2 trillion in assets.
“In the latter part of the first quarter and in the second quarter of 2020, most waste services companies experienced a reduction in waste volumes across sectors because of the COVID-19 pandemic,” says Maia. “Commercial volumes declined the most—roughly by 15 to 25 percent for some companies—because of widespread closures of offices, shopping malls, restaurants and other business establishments.”
She added that waste and recycling volumes from construction and demolition (C&D)—which tend to be susceptible to economic slowdowns affecting housing and construction at large—also declined, albeit to a lesser extent, as many construction projects continued throughout government-imposed restrictions.
“Residential waste volumes have actually increased because of the larger population of people working from home,” she adds. “However, since the pricing of residential waste collections is generally based on volume—not weight—few waste services companies were able to pass on higher residential pricing in the second quarter.”
“Despite the pandemic, the industry was able to maintain consistently strong cash flows, service its debt and provide returns to shareholders,” says Maia.
Jones says environmental initiatives mean “the waste management industry is serving an instrumental role on the front lines of environmental stewardship, supporting broader sustainability goals in the United States.”
He says technology is playing a larger part in the industry to enhance operational efficiencies, reduce costs and strengthen competitiveness. “Examples include new technologies that improve route planning for waste-collection vehicles, modernize the vehicles themselves, and enable sophisticated maintenance programs and data tracking of key operating metrics.”
Lauro refers to the U.S. waste management industry as highly fragmented, ripe for continued consolidation and attracting investors, including private equity sponsors. “A large portion of the industry’s revenue today is concentrated among the four largest public waste services companies, while the remainder of the industry is fragmented among thousands of companies that are identified as solid-waste collection and disposal businesses,” says Lauro.
“Consolidation activity—especially among the large players—has been accelerating in deal volume and transaction amount over the past 3-4 years,” adds Lauro.
Industry consolidation, financing and growth opportunities will be the focus of the day-long Waste TodayCorporate Growth Conference online broadcast event. The broadcast will take place Thursday, Oct. 1, and those seeking registration information can find it on this web page.
Mills in China and Turkey outpaced their 2019 output rates in August, but that rebound has not been matched in many other nations.
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Global steel output rises in August, but imbalances remain
Output in U.S., Western Europe remains subdued; Turkey roars back with 22.9 percent growth compared with August 2019.
Global crude steel output in August showed a 0.6 percent increase compared with August 2019, with the return to pre-COVID-19 levels of production largely attributable to mills in China—which produces half of the world’s steel—churning out 8.9 percent more tonnage compared with one year earlier.
Figures gathered and released by the Brussels-based World Steel Association (Worldsteel) also showed Turkey’s steel production for August 2020 was 3.2 million metric tons, up by 22.9 percent compared with August 2019. That surge in electric arc furnace (EAF) output in Turkey helped boost ferrous scrap demand in the United States and other parts of the world.
According to Worldsteel, the 64 countries that report to it produced a combined 156.2 million metric tons in August, a 2.3 percent boost from the July figure of 152.7 million metric tons. The August figure marks a 13.9 percent rebound from the COVID-19 related low point of 137.1 metric tons produced in April.
While the global steel output figure has returned to a prepandemic level, it has not been a balanced rebound. Among those nations at or above their year-ago output figures in August, in addition to China (8.9 percent) and Turkey (22.9 percent), were Brazil (6.5 percent), Iran (14.6 percent) and Vietnam (32.9 percent).
The list of nations with a decline in production this August compared with August 2019 is longer and includes major steel producers such as the United States (-24.4 percent), Germany (-13.4 percent), India (-4.4 percent) and Japan (-20.6 percent) .
Year to date, North American production is down 19 percent compared with last year’s output; the European Union is down 18.6 percent; South America’s output has fallen by 15.6 percent; and the former Soviet Union nations have produced a combined 4.5 percent less steel.
China has produced 22 million metric tons more steel year to date compared with the first eight months of 2019, but six of its neighbors in Asia (India, Japan, South Korea, Pakistan, Taiwan and Thailand) have made about 34.1 million metric tons less steel so far this year.
Frontline Machinery has become the distributor of Terex Ecotec wood processing equipment in Ontario and Manitoba, Canada.
Newton, New Hampshire-based Terex Ecotec has named Frontline Machinery as its official distributor in the Canadian provinces of Ontario and Manitoba. Terex Ecotec describes Frontline as a family-owned business dedicated to construction, mining, quarry, recycling, and organics applications since 2013, with its headquarters in Chilliwack, British Columbia, and another location in Woodstock, Ontario.
“Frontline Machinery is a proven dealership across Canada’s material processing industries, and Terex Ecotec’s product range aligns with Ontario and Manitoba’s strong environmental and recycling markets,” says George Wilcox, North American Sales and Marketing Director for Terex Ecotec and sister company CBI. “We’re excited to increase Terex’s partnership with Frontline Machinery and have full confidence in their ability to serve customers and represent our equipment.”
“We are pleased to see our partnership with Terex further strengthened by Frontline’s representation of the Ecotec product line,” says Daryl Todd, President of Frontline Machinery. “We are confident in our ability to support their reliable and innovative products through world-class after-sales service and support.”
Terex Ecotec designs and makes wood processing, biomass, and recycling equipment, including slow, medium, and high-speed shredders, trommels and recycling screens, waste handlers, windrow turners, and conveyors.
The State of the Demolition Industry
We polled the industry and spoke with a pair of demolition contractors who shared their thoughts on the current state of the business amidst routine challenges and a global pandemic.
Like many industries, the demolition sector is no stranger to adapting to change. This year more than ever, though, the changes have been universal thanks to the COVID-19 pandemic. At Construction & Demolition Recycling (C&DR) magazine, we want to share the impact those changes have had to both individual companies and the industry at large. Through the information we’ve gathered, we have put together the 2020 State of the Demolition Industry Report.
This report came together through several interviews and a C&DR survey of demolition professionals who work in the United States. The information paints a detailed picture of the current state of the industry as well as potential challenges that might be looming as business picks back up post-COVID-19.
COVID-19 impacts
While the COVID-19 pandemic isn’t the only factor impacting the demolition industry in 2020, it is safe to say that it has been the most substantial.
With work stoppages, delays and strict health and safety guidelines being put into place all across the country, the pandemic has had a large impact on the status of many projects, how quickly those projects could be completed and even how many employees were able to work on site.
Over 36 percent of survey participants say there were stoppages or delays between 1-2 months because of COVID-19, while 21 percent say stoppages or delays of 3-4 months have been experienced. However, 18 percent were fortunate to have no delays or stoppages. On the opposite end of the spectrum, about 18 percent of participants saw much longer delays of 5-6 months, and 6 percent said they have experienced delays or stoppages more than 8 months.
“We experienced delays in project mobilizations and releases of phased work through April and May on existing projects, in addition to a decrease in RFPs/client responsiveness through April,” Mark Klotzbach Jr., VP and owner of Stryker Demolition & Environmental Services LLC (Stryker DES), says. “We had a lot of discussions with our clients to determine a path forward on existing work—most of which revolved around our preparedness and response to the virus.”
When it comes to the impact of COVID on work backlogs, around 36 percent of participants say the pandemic had no impact, 30 percent say their backlog has been extended 1-2 months, 21 percent say backlog has been extended 3-4 months, and 12 percent say backlog has been extended 5-6 months.
Of course, keeping employees safe from the virus while working was a major priority for demolition businesses that remained in operation throughout the pandemic.
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“We certainly changed hotel room policy for jobs out of state, from two occupants in a hotel room to one,” Scott Knightly, president and founder of EnviroVantage says.
The New Hampshire-based company, which has projects across New England, says driving to and from sites has also changed, with fewer employees in each car. Plus, Knightly says the company staggers breaks on the job sites to prevent workers from congregating in groups.
“The quarantining is working, the face masks are working, taking the temperatures of workers is working,“ Knightly says. “Everybody’s aware [of the seriousness of taking precautions] and people are becoming more aware. The problem isn’t doing the work, it’s getting to and from work, the breaks, things like that.”
Klotzbach Jr. says he plans to keep all safety regulations in place as long as necessary for his employees’ best interest.
“Until the CDC releases information stating that masks, social distancing, and other practices to control the spread of the virus are no longer necessary, we will continue to implement these guidelines in our everyday operations,” Klotzbach says. “We will also continue with the reinforcement, as well as the communication, to our staff.”
According to our survey, only about 6 percent of companies shut down operations due to COVID. Fifteen percent said they reduced the number of workers on site, 72 percent increased social distancing, 64 percent offered more PPE, and 61 percent instituted more training and oversight.
Knightly says he believes all safety measures contractors are currently taking will remain in place until there is a vaccine.
Staying on schedule
As the world economy continues to change due to various factors, our survey shows that for many, there has been an increase in work in the past year. Nearly 25 percent say they increased the number of projects completed over the last 12 months by more than 15 percent compared to the year prior and 27 percent say they increased work by 5-14 percent more. Fifteen percent say work stayed the same, while 3 percent say work decreased less than 5 percent; 6 percent say work decreased between 5 and 14 percent; and 24 percent say work decreased by 15 percent or more.
However, going forward over the next 12 months, the answers were a bit more divided. More than 36 percent of participants say the number of projects completed will decrease in the upcoming year from the previous 12 months. More than 21 percent expect work to stay the same, and 42 percent say they will complete more projects in the next 12-month period than they have in the last 12 months.
“Frankly, it seems to be a moving target and it is really hard to predict how the rest of the year will look. Right now, we had some projects get put on hold, but we also had some new projects released that were a bit of a surprise,” Klotzbach Jr. says.
Klotzbach Jr. adds that for his Pennsylvania-based company, there is much uncertainty about the future, with the potential for more shutdowns as cases increase in certain parts of the country. However, he notes that he remains optimistic for the upcoming year.
Knightly says EnviroVantage remained open throughout the early shutdowns of 2020, although there were a few projects the company was working on that did ultimately shut down and require contingency plans
“We had a few job sites completely shut down, mainly because of the market,” Knightly says. “Because who wants to build a hotel right now? Commercial construction and office buildings may be dampened.”
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Employee retention and hiring
When it comes to hiring, the respondents of our survey were fairly split. Just over 25 percent of respondents said both full- and part-time workers increased over the last year, more than a quarter said the number of full- and part-time workers decreased over the last year, and 45 percent say the number of employees remained consistent.
For Knightly, he says layoffs weren’t something EnviroVantage had to think about during the pandemic. He says there were people on each site dedicated to cleaning, so other employees could safely continue their work. He adds that EnviroVantage does a large amount of federal and military work, which has remained steady over the last few months, keeping employees busy.
It doesn’t appear, according to our survey, that layoffs are in the plans for many companies either over the next 12 months. About 85 percent of participants say they’ll either keep the same number of employees or hire more. While just 15 percent say a decrease in employees is in their future plans.
While COVID-19 has prompted many companies to send corporate employees to work from home as on-site workers continue to report to the job, Knightly says that isn’t something he imagines will last forever.
“One thing that I see from my standpoint, and people that I’ve talked to in the industry see, is that people still need socialization,” Knightly says. “You can’t work from your basement forever; it’s a big problem and you don’t know what people’s home lives are like.”
Keeping open lines of communication with employees regarding ongoing work, how the company planned to take care of them and plans for the future were essential in keeping things running well over the last 6 months, Knightly says.
“Your employees are your biggest asset, so you have to protect them,” he adds.
Past and future investments
The slowdown of work for many businesses has impacted financials. That means some companies are having to rethink plans for the near- and long-term future to make sure the best decisions are made with respect to the changes over the first half of the year.
When it comes to investing in equipment, about 58 percent of our survey participants say they’ve remained steady over the last year in that area, while 24 percent have scaled back on equipment investments and 18 percent are investing more.
Looking towards the future, about 39 percent plan to invest more in equipment over the next year. Just 21 percent plan to invest less and the other 39 percent plan to keep investments steady.
With the impact of the last year on the economy as a whole, and on the demolition sector specifically, investment activity is something that bears watching in the coming months.
“When there is any level of uncertainty, particularly when talking about our client base halting funding on demolition projects, there needs to be modifications made with regards to capital expenditures,” Klotzbach Jr. says. “We became much more cautious on capital expenditures. However, due to so many travel restrictions, our travel budget was indirectly reduced as well as our corporate marketing activities.”
This article originally ran in the Sept.-Oct. issue of Construction & Demolition Recycling. The author is the digital editor of Construction & Demolition Recycling and can be reached at kcunningham@gie.net.