‘We are more than satisfied, looking back on 2022. It was a hectic year for the world but one of the best in our company’s history,’ says Clemens Hensel, managing partner of Hensel Recycling. Here he sits down with Recycling International to discuss the company’s recent milestones and its 25th anniversary.
That this is a big year for Hensel Recycling is evident from the energy pulsing through the company’s headquarters in Aschaffenburg, Germany. The site was recently expanded in line with the recycler’s growth strategy and the yard is buzzing with activity.
Big bags filled with printed circuit boards line the walls of one hall while another a dedicated team is handling various types of catalytic converters. Some are as big as a fridge, having come from large haulage trucks rather than passenger vehicles.
Resilient leadership
‘There’s a lot of interest in precious metals and technology metals and we are definitely benefiting from that,’ managing partner Clemens Hensel says. ‘We’re lucky to have a stable and loyal customer base and we have even been able to expand our business a little. It helps that we’ve been a market leader in this sector for over two decades now. People know us; they’re aware of our expertise.’
Hensel notes that, despite challenging market conditions and the post-pandemic reshuffle, processed volumes have been high for both e-scrap and catalytic converters and prices are still at good levels. Although the company has witnessed a downturn in the last six months or so, this has not yet affected the books as the financial year has already closed.
‘No doubt, the war between Russia and Ukraine, lower car sales, inflation, soaring energy prices and, most of all, volatile metals prices will impact our results in 2023 – how could they not?’ the entrepreneur asks. ‘I’m confident, though, we can withstand a little turbulence. We’re well positioned to stay on top of our game.’
As always, commodity prices are the main factor. ‘There was a huge upwards trend in the last few years, this is now normalising. We don’t know how far down prices will go; there are highs and lows and everything in-between. Now we’re on a relative downward spiral but we’ll see where it ends. The good thing is, there is more than enough business in the precious metals segment. We’re not worried in the short-term.’
Hensel recalls that, even during the height of the pandemic, the economy was actually pretty good for European waste managers. ‘Recyclers kept going. The same is true for us.’
Bracing the ‘perfect storm’
Hensel Recycling is therefore keeping its eyes on the horizon, anticipating long-term changes in the market. ‘Naturally, what’s happening in the automotive sector also has a direct impact on our operations. This includes whether producers are buying more or less material, shifting to different materials or launching new vehicle types,’ Hensel adds.
Let’s not forget that consumers are keeping their cars for longer and that has been a trend for the last two years or so. ‘Down the line, it will reach recyclers. Fewer new cars on the road mean fewer scrapped cars. Maybe not today or tomorrow but we’ll notice the difference.’
All these factors combined to create a perfect storm. ‘Everybody is hoping it will get better. It’s another reason for us to explore new recycling opportunities.’ Not least because catalytic converters won’t be produced forever and some brands are already phasing them out. ‘The world’s existing fleet still has plenty of material to last us for several decades but what comes after that?’ Hensel wonders. ‘We don’t want to wait and see.’
At the moment, the company enjoys high prices and high volumes but it is preparing for a different scenario in which prices will be lower with fewer autocats available for recycling. ‘First, we have to adopt our business model to deal with lower prices. Then we have to figure out what else to recycle when the input runs dry.’
The right balance
The company is already looking into potential new material sources, notably fuel cells. ‘We’re still in exploratory mode, getting a handful of cells every month,’ comments managing director Oliver Krestin as he shows Recycling International around the facility. ‘We’re getting acquainted with this emerging market. We’re building our expertise, setting up a team,’ he says, stopping at a new R&D workstation dedicated to fuel cells.
Krestin points out a row of neatly organised cells that have just been dismantled to demonstrate the various layers and the precious metal content. ‘By building our expertise in the start-up phase, we believe that, in 20 years from now when the volumes are there, we can take action.’
On our way back to the office, Krestin points out that most of the material coming in for processing is printed circuit boards of virtually all grades. Krestin values them, the new ones especially, by colour. ‘Autocats are a bit slow t the moment. This is part of the reason we’re looking to diversify our business rather than relying on one type of waste flow. In our experience, if one market is down, another market will balance it out.’
Either way, Hensel Recycling is always busy. ‘We hope this will act as a replacement for any material we will be missing out on,’ Krestin says.
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