FCJ reports billion-dollar haul from scrap metal
Published:Friday | January 10, 2014 | 12:00 AM
Avia Collinder, Staff Reporter
The restructured scrap metal industry has pulled in US$12.73 million (J$1.35 billion) in its first 12 months of operation, and continues to attract hard-currency earnings without traders resorting to the larceny of property, which was previously a feature of the trade, Factories Corporation of Jamaica Chairman Clive Fagan said this week.
The scrap metal trade resumed in January 2013 after suspension since 2011.
According to Factories Corp, the trade now accounts for 80 per cent of export activity through the port of Kingston and has provided employment for 2,000 individuals, directly and indirectly.
The Trade Board, meanwhile, notes that up until December 12, 2013, some 2,092 containers were shipped with 110,596 metric tonnes of scrap.
The FCJ was put in charge of managing the trade after it was decided by Government that there was demand for the product, but that consolidation and strict supervision were necessary.
Scrap trade suspension
The suspension of the trade and subsequent review followed reports of theft of property that wound up feeding the scrap trade.
Trading resumed at three multi-user sites at Riverton and 383 Spanish Town Road, both in Kingston, and at Kurbiton Recycling at Tollgate, Clarendon Park, in Clarendon.
The FCJ "prepared three major sites in record time ... and developed logistics standards to support the efficient operation and security of the industry," said Fagan.
"We undertook the management of this now highly regulated industry, working closely with other major stakeholders such as Jamaica Customs, the Jamaica Constabulary Force and the Trade Board."
He noted that among those directly and indirectly employed are MSMEs, freight forwarders, truckers, and acetylene suppliers. Residents of communities around Riverton are among those who are now engaged in the trade, as well.
The Trade Board lists on its website four companies as licensed industrial dealers, 17 as exporters and 490 as carriers with the same number registered as dealers.
US$9 million in 7 months
Fagan said trade in metals in the last seven months of the year alone contributed more than US$9 million in foreign-exchange earnings.
"It is worth noting that the majority of Jamaica's export earnings through the Kingston Container Terminal is coming from the trade in metals," he said.
Before reopening the scrap metal sector to trading, the Ministry of Industry, Investment & Commerce spearheaded new regulations - The Trade (Scrap Metal) Regulations, 2013, under the Trade Act - aimed largely at reducing theft of metals.
All exporters, except those who generate metal waste in their manufacturing operations, must post a $7-million bond with the Factories Corporation of Jamaica, a portion of which funds compensation for victims of theft.
A convicted exporter will pay a fine of up to $2 million and lose his or her licence to operate.
The regulations require 100 per cent inspection of all containers. Additionally, police and Customs officials are authorised to carry out random checks at both exporter and dealer storage sites.
"What is happening in Riverton is an example of how employment can ease the social pressure. The industry is making business people of individuals who were once looked at as hustlers," said Fagan.
"We are constantly generating waste in metals. What we throw out as waste is another man's treasure," he said.