THE PULSE

Newsletter of the Canadian Association of Recycling Industries

Volume 13, No. 1, January 2008.

This issue of THE PULSE is sponsored by

Visit http://www.cowangroup.ca/cari-07 for information.

 2007 IN SUMMARY

CARI membership grew by 15% in 2007 to include some 265 companies and 35 branch plants.  We worked with members, government officials and police representatives on the issue of metal theft and lobbied forcefully to prevent invasive and impractical municipal bylaws designed to combat the problem.  In addition to our annual convention, golf tournaments, chapter meetings, and consumers’ night CARI hosted a workshop for companies and suppliers involved in the E-Recycling sector and held a mini convention forQuebec members.

 YARD FOR SALE ?

A multinational company engaged in scrap and metals trading is seeking to buy a large Canadian scrap yard or business. Please contact canscrap@gmail.com

 CARI SERVICES

The National Association Supply Cooperative (NASCO-OP) has declared a 1.5% patronage dividend for 2007.  NASCO-OP is the recycling industry’s purchasing cooperative and is available at no additional cost to members of ISRI, CARI and NDA.  The dividend, calculated on the purchases a member or associate made at the cooperative, further reduces the purchase price of supplies and equipment.  Cooperatives give members and users of all sizes the purchasing clout of an entire industry while still maintaining their independence.  For more information on NASCO-OP, contact them at 800-321-3396 or visit their web site at www.nascoop.com

INSURANCE TIPS

BUSINESS INTERRUPTION INSURANCE

Business interruptions can be caused in any of the following ways:

1.      Physical damage to property or contents.

2.      Interruption of water, electrical or telephone use due to a loss caused by an insured peril off-premise.

3.      A transportation related accident which subsequently causes delays due to an insured peril.

4.      Loss of access and hence income due to physical damage to neighbouring premises due to an insured peril.

5.      A loss at a major supplier or customer.  

6.      An Order of Civil Authority caused by emergency conditions.

7.      Strikes or employee lock-outs at a time when an insured is trying to rebuild after a loss.

Property insurance generally covers the financial loss to buildings, stock, equipment and office contents, but it does NOT cover the lost business income or extra expenses incurred when a disaster occurs.  There are, however, 2 principle ways to insure against such losses - Profits Form or Gross Earnings Form. 

The former insures the net profit (before taxes) of the business, plus all fixed expenses which continue during the business interruption while the latter insures the total sales and service revenue, less the cost of goods and services which do not continue during the business interruption. 

Both forms require the insured to insure the total payroll costs of executives, department managers, key employees and employees under contract but offer an option to cover “ordinary” employee payroll expenses for a period of 90 or 180 days.  Both allow for a Premium Adjustment Endorsement which sets the final premium after the years' financial statements have been finalized.  Each form needs to be calculated based on future trends, not where the insured's revenue or profits are today and both forms only cover extra expenses that are incurred to reduce the payout for the loss. 

The calculation for both forms tends to lead to insuring for the same limits, but there are some major differences in coverage between them.  The Gross Earnings Form only covers the insured until property reinstatement and the business can re-open for business in its current location.  It also allows for 50% or 80% co-insurance.

The Profits Form covers the insured for 12 months or until profit levels are restored to pre-loss conditions.  With this coverage you must insure for 100% of value.  It does, however compensation for loss due to:

·        Bylaws or Zoning Delays

·        Building Plan Delays

·        Slowness of Landlord in Reinstating the Property

·        Strikes or other Labour Disturbances

·        Failure of Building Contractors or Suppliers to Meet Obligations or Deadlines

To determining the proper coverage for a business the following should be considered:

1.      How important is your current location to carrying on business if a substantial loss should occur?

2.      How long would it take for you to resume business somewhere else?

3.      Do you have any pieces of equipment which substantially contribute to the bottom line which would require considerable time to re-acquire or re-build?

4.      Would you lose any major customers or contracts if you were required to delay delivery of a product or service?

Finally, additional coverage, such as contingent business interruption endorsement, extra expense endorsement, and rent or rental value endorsement, are available and may be worth consideration to broaden coverage.

 BUSINESS OPPORTUNITIES

Offers are invited for the supply of vessel loads (30,000 tonnes) of ferrous every month on a yearly contract. We are also interested in offers for sale of non ferrous on an on-going basis. Interested members should contact Ajay Rao at (416) 648-9861or by e-mail at canscrap@gmail.com

 FAST FACTS

• World crude steel production for the first 11 months of 2007 was 1.2 billion metric tons or an increase of 7.7% over 2006.   China remained the world’s leader but higher production has been achieved in India, Russia, Turkey and South Korea.  The 27 EU countries also showed a slight increase while the U.S. declined.  Additional detail can be found at the IISI Web site at http://www.worldsteel.org

• The U.S. Energy Independence and Security Act was passed out of Congress and signed by the President late last year.  The bill includes increased fuel efficiency standards for cars, requires the production of over 36 billion gallons of alternative fuel sources by 2022, and adds other energy efficiency and conservation requirements earlier this week but not the energy tax package.  The accelerated deprecation allowance for recycling equipment (RISE) was included in the energy tax package. ISRI anticipates that the energy tax package will likely be included in a future energy initiative next year.

• Under a new rule by the U.S. EPA electric furnace steelmakers will only be able to purchase shredded ferrous scrap from vehicles from dealers that are participants in the National Vehicle Mercury Switch Recovery Program.  The steelmakers have 3 year to comply with the new rule.

·        To avoid becoming a dumping ground for unwanted waste China plans to examine scrap imports more thoroughly in the future.  The new regulations will ban all materials that can only be disposed of by incineration.  They will also require international shippers to provide a more detailed description of scrap sent to China.

·        In order to make it difficult for thieves to sell stolen copper anywhere in Mississippi an ordinance has been drafted that would create a statewide copper sales registry that would include the names, addresses, and photos of anyone who sells scrap copper to metal recycling companies in Mississippi.

CARI EVENTS

CARI’s 67^th Annual Convention "Melting of the Cultures”

June 20 to 22

at the Fairmont Le Manoir Richelieu

in La Malbaie, Charlevoix, Quebec.

_________________________________

CARI’s Annual Golf Tournament

August 14

At The Club at Bond Head

_________________________________

CARI’s 11^th Annual Consumers’ Night

November 10

at the Fairmont Royal York

in Toronto

__________________________________

For information on CARI events contact Donna Turner

at (905) 426-9313 or visit www.cari-acir.org

OTHER UPCOMING EVENTS