From Alcoa Inc (NYSE:AA) to Boeing, aluminum traveling the “closed loop” route

Posted by Chris Bell June 27, 2013 0 Comment 1226 views

Alcoa Inc (NYSE:AA) and Boeing announced at the Paris Air Show held at Le Bourget, France, that they have formed a closed-loop program. This program will go a long way in increasing recycling of any internal aluminum-aerospace alloys that are used during Boeing airplane production. The closed-loop recycling program will allow inter-modal transport of aluminum alloy scrap material. This includes advanced alloys from the Auburn and Wichita Boeing facilities and third-party processors in Auburn. These will be transported to the aluminum company’s Lafayette, Indiana facility where it will be melted and recycled into brand-new aerospace materials.

Expansion plans
Via this program, 2XXX and 7XXX-series aluminum-alloys will be recycled. These are used in the fuselage and wing component production, of Boeing airplanes. Forms such as aluminum sheet, extrusions and plate products will be included. Initially, it is expected that around 8M pounds of aluminum will be recycled on an annual basis.
This program also lays the foundation for expanding the effort to capture all scrap from various Boeing sub-contractors. Later this will include other forms of aluminum such as chips that are a by-product of machining aircraft parts.

What exactly is “closed loop” recycling?
“Closed loop” recycling is essentially a production process via which waste is collected, recycled and then used in the manufacture of new products. This process may be really as simple as using recycled aluminium in the manufacture of new cans or as complex as collecting aluminium machine scrap and recycling it to produce new products. In order that the closed loop system function properly, the consumers, recyclers as well as manufacturers have to work in a seamless manner to gather materials from the waste stream and then use them to manufacture new products.

Collection is the first step of the closed-loop recycling system and manufacturing that recycled material into entirely new products is the second step. The third and in most probability, the most critical step is purchasing. Alcoa Inc (NYSE:AA) and Boeing are ensuring that all bases are covered –right from the foundry to the manufacturing units.

About Chris Bell

Chris Bell is an investing reporter for GDP Insider. Chris covers financial markets and Wall Street, concentrating on developments affecting individual investors and their portfolios. Chris is also over consumer reporter and covers a wide variety of issues ranging from housing to immigration to urban poverty. Chris graduated from the University of Scranton with a degree in Communication and Philosophy. Chris's diligent investigations earned him the honor of being named "Best Reporter" once by the Headliners Foundation of Texas and once by the Houston Press Club.

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