Gold and the rising costs of e-waste recycling
A major reason the recycling of old electronics, i.e. e-waste recycling, has become such a large and rapidly growing industry is due to the amount of precious metals used in manufacturing electronics. As the commodities market skyrocketed over the past 6-7 years it attracted a lot of interest from the recycling and investment communities. Virtually everyone wants to be “green” and recycle. However, for many others the true “green” motivation is “cash”! And gold, in particular, continues to be a major factor in this market.
Gold and other precious metals such as copper, silver, and platinum are found in many types of electronic devices. They are found in computers, monitors, cell phones and many other gadgets. In fact, one metric ton of circuit boards can contain 40-800 times the amount of gold as one metric ton of raw gold ore*, which contains just five grams. This creates an inverse relationship between trending gold prices and the cost of recycling e-waste. In other words, when gold prices are high then the cost of recycling will decline and vice versa.
Beginning in late 2012 gold began its downward trend. It reached its peak at almost $1600 per ounce in August 2011 and has declined to roughly $1200 per ounce. This is a 25% loss in just 3 years and future projections indicate a continued decline. Many experts suggest gold’s value is dropping because of the stabilization of the global economy and the value of the U.S dollar, both of which show signs of strengthening in coming years. That’s great for the US economy, but it’s not so wonderful for consumers and businesses that need to recycle.
Another contributing factor to rising e-waste recycling costs is the fact that new computers and other electronic devices continue to decrease in size and weight. This poses a major challenge for recyclers and commodity-driven businesses that are focused on processing tons and tons of materials . Further, manufacturers are producing more equipment using smaller amounts of gold and precious metals. So, as time passes the e-recyclers will have to process significantly more equipment and materials to capture the same amount of gold per ton of recyclables than they are producing today.
Less weight, less gold and declining gold values will result in continued rising costs to recycle e-waste. It’s that simple.
Author: Cam Deery, Castaway Technologies LLC