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Electronic Waste: A Small but Growing Source of Secondary Supply to the Precious Metals Market

Erica Rannestad

The generation of electronic waste has increased significantly over the past few decades, giving way to increased need for greater management of this waste stream. The regulatory environment has become increasingly stringent, particularly in the European Union and the United States, home to the largest sources of e-waste globally. Western Europe and the US accounted for 40% of the 42 million metric tonnes of e-waste generated in 2014, according to a report produced by the United Nations University. As a result, more end-of-life (EOL) electronics are being recycled. GFMS estimates that recycling rates have increased from 14% of total e-waste generation in 2000 to 27% in 2014. This means that more raw materials used in the fabrication of these EOL electronics are re-entering commodities markets as secondary supply. This is especially true for precious metals, whose relatively higher value-to-volume ratio make recycling of precious metals-bearing e-scrap economically attractive.

At present, the most common precious metals-bearing electronics entering the recycling circuit are computers and cell phones. Major components of these electronics containing precious metals include printed circuit boards, SIM cards, connectors, brackets and solders. GFMS estimates that 2.7 million metric tonnes of computer and cell phone scrap was generated last year. This volume amounts to a mere 6% of total e-waste generated. Scrap generation of these products has increased at a 10% compounded annual growth rate (CAGR) since 2000. Meanwhile the volume of computers and cell phones recycled has increased at a 15% CAGR. This faster rate of growth is a testament to the impact of more stringent e-waste regulation, but also to improving recycling economics due to higher commodities prices and better recycling technology.

When e-waste is generated, the scrap will go to landfill, be recycled for its raw materials value, or refurbished and reused by a second owner.  At present, around 35% to 45% of global e-waste generated is actually collected by recyclers and/or reburbishers. This low collection rate suggests the scope for growth in recycling is significant going forward, as governments and industry push toward reducing the flow of recyclable waste to landfill. An estimated 16% of e-waste collected goes to refurbishers and as mentioned earlier, about 27% is estimated to be entering the recycling circuit. In recent years, the growth in recycling has been curbed by rapid growth in the refurbishment market. This is particularly true in the United States where reuse is increasingly being given more focus.

E-scrap entering the recycling circuit first goes to a disassembler who will separate electronic components by value profile. The precious metals-bearing components will then be shredded to reduce the size of the scrap feed. This material will then be sent to a recycler who will incinerate the feed, further reducing the particle size and homogenizing the material. The output from the incinerator, called ash, will then be shipped to a smelter. There is an estimated 800,000 metric tonnes of capacity to smelt e-waste ash. GFMS estimates that around 460,000 metric tonnes of e-waste ash was smelted in 2014, which suggests a 57% capacity utilization rate for the year. E-waste feedstock to precious metals smelters increased by 19% in 2014 and has increased at a 13% CAGR since 2000, nearly in line with the 15% CAGR of recycling volumes of computer and cell phone scrap.

Most of the smelters worldwide that accept e-scrap feedstock started out as copper ore smelters, building capability to handle e-scrap in the 1990s or early 2000s. The other e-scrap smelters are highly specialised in precious metals product fabrication. Most of the smelting capacity, around 55%, is located in Western Europe. The balance is mostly in Canada, Japan, and South Korea.

GFMS estimates that 3.7 million ounces of precious metals were recovered from recycled computers and cell phones in 2014, a 5% increase over the previous year and more than five times the volume recovered in 2000.  This volume only represents around 2% of precious metals scrap supply to the market in 2014. Approximately 10% of last year’s total volume was gold, 84% was silver, and 6% was palladium. Additionally, 97% of precious metals recovered came from computer scrap while the balance came from cell phone scrap. While there are other EOL electronics with precious metals value, GFMS has focused on computers and cell phones as these two products are the most sought after EOL electronics among precious metals recyclers at present due to their positive recycling economics. Most precious metals e-scrap recyclers focus on these sources of feedstock while receiving additional material from recyclers that focus on other electronics for their bulk metals value. That said it should be noted that total precious metals recovered from e-waste may be higher than the 3.7 million ounces coming from computers and cell phones.

Going forward, there are many positive factors that point toward rising precious metals supply from e-waste recycling. The ongoing diversion of e-waste from landfill to the recycling circuit, better and more profitable recycling and smelting technologies, more stringent regulations over e-waste management, and increasing concern about mine supply constraints all point toward increased e-scrap recycling. Negative factors, expected to weigh on scrap supply growth, include increasing diversion of potential recycling volumes to the refurbishment market, consumer electronics miniaturization which reduces to an extent the per unit precious metals content, and medium-term commodities price weakness. GFMS expects precious metals supply from recycling of computers and cell phones to increase at a 0.3% CAGR from 2014 through 2019. This reduced growth rate relative to the past 14 years is mostly due to lower precious metals content in computers and cell phones that are expected to enter the recycling circuit in the medium term. 


Erica Rannestad is a Senior Precious Metals Analyst on the GFMS team at Thomson Reuters, specializing in the development of demand and scrap statistics and forecasts. Erica is the first North American-based analyst for GFMS, managing and executing GFMS’ primary field research program in the region.

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