Metallic Raw Material Tracing at ME Elecmetal: Efficiently Coordinating Supply with Production

Since its inception, ME Elecmetal has been dedicated to enhancing the circularity of its raw materials to produce high-quality steel castings, aligning with its production technology (electric arc furnace) and, above all, adding value to its customers.

Founded in Chile in 1917, ME Elecmetal pioneered the use of electric arc furnace (EAF) metallurgical casting technology in Latin America. This technology relies primarily on scrap as its main raw material, making the process inherently circular. Instead of treating scrap as waste, ME Elecmetal manages it as a valuable resource that can be recycled and reintegrated into the production cycle. In South America and North America, scrap is recovered and centralized in specialized facilities for processing before being reused. ME Elecmetal China adapts its scrap recovery methods to comply with local regulations and geographic considerations.

This shift towards circular operations reflects a broader evolution in the mining sector and customer expectations, moving away from linear models that end with landfill disposal of non-hazardous waste. Instead, waste is viewed as a potential by-product that can be managed for reuse, exemplified by ME Elecmetal’s treatment of scrap.

This aspect is fundamental to ME Elecmetal’s casting production and forms the foundation of its business model, driven by its technology that globally recycles 95% of all raw materials across its three regional production plants.

A key component of ME Elecmetal’s success in raw material management is its effective coordination of supply with production operations. This process is primarily monitored through two types of indicators, both on a regional and consolidated basis. This meticulous approach ensures that resources are utilized efficiently and sustainably, supporting the company’s commitment to environmental stewardship and operational excellence.

ME ELECMETAL SOUTH AMERICA  

ME Elecmetal South America’s Rancagua Plant in Chile achieved significant milestones by 2023, producing 27,380 tons of high-quality steel, with 96% of the total inputs coming from recycled raw materials.

This achievement was made possible through coordinated efforts across the Commercial, Operations, Procurement, and Supply Chain departments, along with the Maipu Facility in the case of ME South America. This facility, managed and led by women, operates with a team of 55 professionals and operators. Together with the procurement team, they successfully recovered an annual surplus of metallic raw materials amounting to 123%, ensuring continuous supply to the plant and maintaining inventory reserves for almost six months.

In addition to their core casting supply agreements, ME Elecmetal South America has implemented a scrap recovery contract. Through this initiative, they have achieved a remarkable 91% recovery rate of scrap, which not only secures better services for customers but also enables traceability of raw materials back to their origin. Impressively, in 81% of cases, the scrap is sourced directly from ME Elecmetal’s operations.

These efforts underscore ME Elecmetal’s commitment to sustainability, efficiency, and customer satisfaction, positioning them as a leader in responsible resource management within the industry.

ME ELECMETAL NORTH AMERICA  

In 2023, the Tempe and Duluth plants in the United States achieved significant production milestones, with Tempe producing 13,618 tons and Duluth producing 25,401 tons of high-quality steel. These figures were achieved using 95% and 93% recycled raw materials, respectively, in each foundry.

The supply area played a crucial role, recovering 78% of the raw materials used. Notably, 61% of these materials were traced back to their origin, including parts reclaimed from the end of their lifecycle within the mills and purchases from third parties. This comprehensive approach ensures the sustainability and efficiency of raw material use, supporting ME Elecmetal North America’s commitment to responsible resource management.

ME ELECMETAL CHINA 

In 2023, the Changhzou Plant in China produced a total of 27,356 tons of steel, utilizing 95% recycled raw materials. Efficient operations and supply management allowed for the recovery of 56% of metallic raw materials, with 3% traceable to their origin, primarily consisting of parts reclaimed at the end of their useful life within the mill.

Despite challenges related to import restrictions, ME Elecmetal China maintained a 95% export rate of high-quality steel castings. This strategy underscores their commitment to sustainable practices and efficient resource utilization, crucial in reducing their carbon footprint downstream and enhancing collaboration throughout the supply chain.

Having visibility and control over the circular path of raw materials not only ensures operational continuity and production quality but also enables customers to manage their disposal processes more effectively. This integrated approach contributes to closing the loop on resource usage, thereby improving services and environmental outcomes.

Having visibility and control over the circular route of raw materials enables the metallurgical industry to ensure operational continuity and enhance the quality of final production through efficiencies. It also enables customers to better manage their disposal processes, thereby improving logistics handling. Moreover, this approach is critical for reducing carbon footprints downstream and fostering collaboration within the same scope, effectively closing the loop and enhancing services. ME Elecmetal's objectives related to the circularity of raw materials include:

The use of recycled metallic raw materials in our manufacturing process has always been integral to ME Elecmetal’s circular economy approach and a cornerstone of our integral solutions for customers. We are dedicated to expanding our recycling capacity, establishing clear traceability from origin, and enhancing efficiency across the supply chain. This not only reduces our own carbon footprint but also supports our customers in lowering theirs, all while ensuring the high quality of our final products.
— Roberto Lecaros, VP Marketing, Sustainability and Technical Development. 

 

We strive for complete visibility of our raw materials across all our global production points. Our focus on recovery rates, traceability, and the utilization of recycled materials, alongside meticulous emissions monitoring, underscores our commitment to delivering increasingly sustainable steel solutions for the global mining industry.
— Constanza Echeverría, Global Sustainability Director 

Metallic Raw Material Main Indicators:  

Supply: 

2023   CHILE  US  CHINA  ME ELECMETAL 
Total annual production (tons)  27.380  39.019  27.356  93.755 
Percentage of annual recovery of total metallic raw material over the total annual production    123%  71%  93%  93% 
Percentage of traceable recovery from source out of the total annual production    81%  61%  3%  50% 

 Production:  

2023   RANCAGUA  TEMPE  DULUTH  CHANGZHOU  ME ELECMETAL 
Percentage of recycled raw material out of the total inputs  95%  95%  93%  95%  94% 

Three indicators aid in the monitoring and management of metallic raw materials: 

  • Tons of metallic raw material recovered per annual total produced.  
  • Percentage of metallic raw material recovered and traceable to origin   
  • Percentage of recycled material over total raw material in a production year.   

 

Source: Maipu facility, 2024 

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