Date of Award
Master of Business Admin
The aluminum beverage can market is extremely important for Reynolds Metals Company and other aluminum producers being the single largest end-use market for aluminum in the United States. Shipments of 77.9 billion cans in 1988 accounted for 96% of total beverage can shipments, equivalent to 3.6 billion pounds of input canstock or 21% of the estimated 16.9 billion pounds of U .S. aluminum industry shipments. It is also one of the few aluminum markets that has exhibited consistent growth this decade, with canstock shipments increasing 4.6%/yr.versus 1.8% for all other products. Its success can largely be linked to its recyclability and high scrap value . Despite this advantage, however, its recycling rate has stalled in the range of 50 - 55% during the 19BO's, making it a continuing target for environmentalists (Can Manufacturers Institute, Aluminum Association, 1989).
State legislation targeted at used beverage containers (UBC 's as a means to control litter and encourage recycling has been proliferating since the 1970's. While the degree of control varies, there is hardly a state today without some sort of restrictive beverage container law. Provisions range from simple bans on detachable pull tabs to complex mandatory deposit and recycling legislation. Container manufacturers, bottlers, and brewers have long argued that mandatory deposit laws do not appreciably reduce litter and are far more costly than voluntary recycling, and result in increased beverage prices and consequent declines in demand, tax revenue, and employment.
In the late 1980's, however, a much broader issue has emerged. Many states with large urban populations will experience a solid waste disposal crisis within the next decade. Although voluntary efforts and mandatory legislation have removed a portion of aluminum, glass and plastic from the waste stream, a substantial volume still finds its way to landfills. Given the immediate need to reduce the volume of material sent to landfills, legislative activity is intensifying to force waste reduction partially through packaging material recycling and reuse.
Reynolds has continually sided with the industry in opposing mandatory deposit legislation. Recent industry trends, including higher aluminum prices and competitive threats from steel and plastics, coupled with promotion of curbside recycling laws by the glass and plastics industries, have suggested the company might wish to reevaluate its position due to the importance of the aluminum beverage can to both the industry and the company.
This study will examine current trends in solid waste legislation to determine the likely forms of such laws and their implications for the aluminum beverage container.
Whitehouse, Phil, "Trends in solid-waste management and the implications for the aluminum beverage can" (1990). Master's Theses. 1086.