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'Arms race' has benefits for scrap recycling

As the world arms itself to the back teeth, ironically it seems that the recycling industry could be a major beneficiary.

While fighter jets, tanks and warheads sound as if they would be more likely to destroy the planet rather than save it, the production of these is providing a huge market for scrap high temperature alloys, titanium alloys and refractory metals.

To put the production into context, the USA - as it wages military offences in Afghanistan and Iraq - has budgeted $556 billion for this year alone which includes repairs, replacement of equipment and new hardware purchases. 

The US Pentagon has also cleared funding for the purchase of 183 F22 Fighters in the 2007, which if approved by Congress will extend the production line until 2012.

With the UK, French and German governments also increasing their spending and China raising its military budget by almost 15%, it seems we could be in the midst of another arms race.

Algeria is spending US$7.5 billion on jet fighters, while India has 200 fighters, tanks and ships on its shopping list before 2012.

What all this means though is that there is an unprecedented demand for titanium and nickel alloys. And with aerospace businesses fully booked for production through to 2012, and 500 light jets set to be built each year from 2007 by Honda, Cessna, Adams and Embraer, the potential for reuse in the sector appears to have no limit.

Massachusetts-based Universal Metal Corporation president Stuart Freilich said: The estimated industrys backlog [in the USA] as of June stood at US$280 billion and if you add these amounts with the other aircraft producers worldwide, you can see the tremendous amount of business ahead of us.

While the past few months have seen a slowing of demand, Freilich added that this is just a temporary blip with commercial operators also offering future opportunities.

What we have been seeing is a temporary slow down of demand for titanium and nickel alloy scraps due solely to the inability of [commercial airlines] Boeing to ramp up production of the 787 and Airbus technical problems for the A-380. Soon these problems will be corrected and we will have smooth sailing ahead, with steady pricing and demand, he concluded.

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