Solvent Recovery Sector Showing Signs of Improvement

As Oil Prices Climb, Prospects for Solvent Reclamation Facilities Rise

Contacts: Paul C. Evans 952/831-2473, ext. 12
Cary Perket 858/488-4760

January 22, 2001 — For Immediate Release

Edina, MN — The EI Digest: Hazardous Waste Marketplace, North America’s leading research service on hazardous waste management, announced the results of its annual survey of the commercial solvent recovery sector. The results show that volumes of solvents recovered at 47 commercial facilities declined by less than 5 percent between 1998 and 1999.

The decline in volume can be attributed to lower oil prices, because many solvents are organic-based. As the price of oil increases, it becomes more attractive to recover the solvents, rather than purchasing more expensive virgin chemicals. "Unlike most other hazardous waste sectors, such as commercial incineration and landfilling, the solvent recovery sector is benchmarked by the price of oil, rather than general economic growth which fuels increased manufacturing and remediation waste" comments EI Analyst Paul Evans. "Because of the recent increases in crude oil prices, solvent recovery operators have reason to be cautiously optimistic that solvent reclamation is becoming a more cost-effective solution for manufacturers."

The survey also demonstrates that the competition within the sector remains tight. Several facilities reported their exits from the market — at least temporarily — to implement new equipment enabling the facility to accept more profitable waste streams. "Those that compete in the highly competitive solvent recovery marketplace recognize the necessity to make facility upgrades or diversify their service offerings," Evans adds. "Profit margins are extremely tight for high-volume/low-grade solvents. Because of this, companies are exploring ways to increase profitability. Fortunately for larger corporations, they have the customer base and pool of resources from which to draw."

"The expanded solvent recovery business opportunities created by RCRA regulations have been steadily eroded by the phase-out of profitable chlorinated solvents and the replacement by lower-valued ones," comments EI Senior Analyst Cary Perket. "These lower valued solvents have economical values more suited to fuels, so the majority of the solvent recovery firms diversified into fuels blending. While high crude oil prices might increase generators’ incentives to recover solvents, it could have a negative impact on the fuel blending market by reducing the amount of available solvents for us as hazardous waste fuels."

This report appeared in the EI Digest: Hazardous Waste Marketplace, a business research report published 10 times per year that covers hazardous waste management issues. Further information of the EI Digest can be found on ENVIROBIZ.COM (www.envirobiz.com), one of the Internet’s leading sites for proprietary and public environmental business information. Based in Edina, Minnesota, Environmental Information, Ltd. (EI) specializes in information and research on the environmental services and technology marketplace. EI provides original subscription-based research services. Among the services is the comprehensive compilation of the largest directory and database of environmental service firms, landfills and treatment, storage and disposal (TSD) facilities in North America. For further information, contact customer service at 952/831-2473.

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