Precious metals company Heraeus expands recycling business in China to tap environmental protection efforts

The company will launch a plant in Nanjing by September next year to recycle and refine precious metals, which are mainly used as catalysts to help reduce carbon emissions.

Germany-based precious metals company Heraeus said it will enhance its recycling business in China as it leverages the nation’s rising efforts on environmental protection.

The company will launch a plant in Nanjing, Jiangsu Province by September next year to recycle and refine precious metals, which are mainly used as catalysts to help reduce carbon emissions and speed up chemical reactions, it told Shanghai Daily.

China is short of natural precious metals such as platinum and palladium, but has a strong demand. Last year China consumed 22 percent of platinum and 24 percent of palladium produced globally, according to SFA Oxford, a UK-based metals and commodities consultancy.

“That means great potential for recycling,” said André Christl, president for global precious metal business at Heraeus.

Apart from being used in jewelleries, platinum is also a key catalyst in exhaust pipes. It, together with palladium, purifies gas emissions of vehicles. They are also widely used in oil and chemicals refining.

The company has already chalked up robust sales in China on trading of precious metals. Forty percent of global sales last year were derived from Asia, and most of them came from China. “Recycling will greatly enhance our production in China to boost trading and services,” Christl said.

The company didn’t unveil production capacity for its Nanjing plant, but said its output will be equal to one third of that in its largest refining company in Germany. The Nanjing plant will recycle precious metals from used cars and chemical refining companies before processing them back into catalysts.

As China tightens rules for gas emissions and industrial pollution in a bid to enhance air quality, demand for precious metals as main catalysts will continue to rise, said Stephen Forrest, chairman of SFA. “That means long-term opportunities for precious metal companies,” he said.

China has been stepping up efforts to industrial production with high pollution in the north region since last month. The aim is to ensure that the level of hazardous PM2.5 particles in winter falls by 15 percent year on year within the Beijing-Tianjin-Hebei Region, according to the Ministry of Environmental Protection.

A chemical giant in North China has signed long-term contracts with Heraeus for precious metal supply, as “we have to enhance energy-saving and reduce pollution with the help of catalysts,” said an official surnamed Wang, who asked not to disclose the name of the company. “Many low-efficient chemical companies have been phased out due to more stringent controls over pollution.”

Recycling of precious metals also helps counter declining production, given the world’s supply of platinum is predicted to shrink 110,000 ounces from 2017 to 2022, dragged by depletion and output cuts in South Africa, according to SFA.

Amid the supply shortage, the average price of platinum and palladium in September were US$969 per ounce and US$939 per ounce respectively at the London Bullion Market Association, close to the gold’s price of around US$1,280 per ounce.

Chemical producers have been motivated to develop new materials to replace precious metals. Dai Liming, professor at Kent Hale Smith, and Guy Berterand, professor at University of California, respectively proved carbon and carbene can replace platinum as catalysts if mixed with other elements such as nitrogen.

But such replacements only apply to limited chemical reactions.

“Precious metals companies will have to tap recycling in a bid to address depletion,” said Pascal Metivier, science and technology director at Solvay, a Belgian chemical group. “Although more and more renewable and less expensive materials will be found to replace precious metals, it takes decades for chemists to put the lab applications into industries.”

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