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March 15, 1999 01:00 AM

MARKET FACTORS DRIVE TDF USAGE DOWN

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    HILTON HEAD, S.C.—The use of tire-derived fuel (TDF) hit a bump in the road last year, reducing the overall recycling/reuse rate for waste tires in the U.S. After reaching 135 million tires in 1996, the amount of scrap tires burned as fuel fell more than 17 percent to 115 million units in 1998, said Michael Blumenthal, executive director of the Scrap Tire Management Council.

    Meanwhile, the number of scrap tires used for civil engineering projects doubled over the same period, while the total for ground rubber remained the same.

    With TDF representing the largest single market for scrap tires, the downturn meant fewer scrap tires—about 65 percent of the 273 million generated—were recycled/reused in 1998. This compares with 76 percent two years ago, Mr. Blumenthal said.

    ``It's going to take longer than we originally anticipated to reach as close to 100 percent as possible,'' he said.

    Mr. Blumenthal blamed the decline in TDF usage on several factors, none involving environmental issues.

    Since 1996, six cement kilns that previously had burned tires as fuel stopped using them for economic reasons, he said in a speech at the Clemson Tire Conference, March 3 in Hilton Head.

    While burning scrap tires is cheaper than using coal in cement kilns, they require more oxygen which slows the production cycle, he said.

    With the cement industry running at capacity, the need for greater production efficiency is outweighing the savings in fuel costs at some plants.

    Several other kilns with permits to use TDF are burning fewer tires for the same reason, he added.

    Deregulation in the utility industry also has impacted TDF usage, as several older plants have shut down and others have stopped using alternative fuels.

    Mr. Blumenthal also cited the Environmental Protection Agency's Clean Air Act Amendment and Wisconsin's termination of its subsidy for TDF in late 1996 as factors contributing to the downturn.

    Still, he predicted, TDF usage will recover, albeit slowly.

    Meanwhile, civil engineering uses for scrap tires, which were all but dead two years ago after fires erupted spontaneously in three road projects, has surged.

    In 1998, Mr. Blumenthal expects this market sector will have consumed about 20 million tires, double 1996's total.

    He attributed this rebound to the development of guidelines for civil engineering construction projects, new American Society for Testing and Materials specifications on civil engineering applications and a series of educational and technical seminars held throughout the country for state transporation engineers.

    The market for ground rubber, often called crumb rubber, is not nearly as rosy.

    While ground rubber use appears to offer the greatest return on investment for any scrap tire, this market segment has not realized anticipated growth, Mr. Blumenthal said.

    For the past two years, the amount of crumb rubber produced has held steady at 480 million pounds, consuming 12 million to 14 million scrap tires.

    The key for the crumb rubber segment is to develop, promote and sustain the markets, Mr. Blumenthal said. If the markets fail to expand but production capacity does, the business could very well ``implode,'' he said.

    The Scrap Tire Management Council currently is conducting a survey to determine the number of scrap tires stockpiled in the U.S., Mr. Blumenthal said. In 1994, the number was 850 million tires; two years later it had dropped to 800 million.

    With many states aggressively reducing stockpiles and with better accounting methods, Mr. Blumenthal expects a further decrease this year.

    Going forward, Mr. Blumenthal said the Scrap Tire Management Council is looking to expand the markets for scrap tires used in civil engineering projects and to shore up the infrastructure for ground rubber.

    As for TDF, Mr. Blumenthal said he is ``clearly concerned.''

    With the causes varied and not directly correlated to the use of tires, he said the council plans to: work with current TDF users to help them deal with various issues; work with potential users; and contact former users to get them back.

    ``We want to continue to work with major end markets of the tires,'' he said. ``This industry has come too far to let the markets come down.''

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