Where The Customers Are

April 22, 2005

MBA Polymers locates plastics recycling plant in Guangzhou.

Richmond, Calif.-based MBA Polymers Inc. is not in China because of the vast Asian nation's famed supply of relatively cheap labor. "It's all about the size of the marketplace in southern China," stresses Richard McCombs, president and CFO of MBA Polymers, a privately held plastics recycling firm founded in 1994. "It just makes a lot of sense, from a marketing point of view, to be located where a lot of our customers are."

Initial target customers, indicates Michael Biddle, MBA Polymers' founder and CEO, are the appliance, automotive, consumer electronics and IT equipment industries. "The consumption of plastics is so huge that we anticipate that most of [our output of recycled material] will be consumed domestically," says Biddle.

With Guangzhou Iron & Steel Enterprises Holdings Ltd., its state-owned joint-venture partner, MBA Polymers is building a 6,000-square-meter plastics recycling facility on a 20,000-square-meter site in Guangzhou, a major manufacturing area northwest of Hong Kong. It expects equipment to be installed by June of this year and the plant to be commissioned in July. The plant, which will have a feed capacity of 40,000 tons, when fully ramped up is expected to operate in three shifts 24 hours a day and five days a week and employ 60 to 80 people. About half the plant's output of recycled plastics will be in the form of flakes, the other half in pellets. The total employee count will depend on "how much we decide to involve some manual labor," explains McCombs.

Although many of the Guangzhou plant's customers will be in China, a large percentage of its shredded material feedstock will be imported from Japan, Europe and the U.S. "We are going to install a shredder, but we are not going to do that immediately," says McCombs. "We anticipate having more than an ample supply of shredded plastic. And that's really where our success is -- in our ability to take a shredded plastic and separate it as opposed to a whole part or bigger piece."

MBA Polymer's relationship with Guangzhou Iron and Steel Enterprises, one of the People's Republic's largest steel companies, was established unusually quickly by Chinese business standards. Introduced by an intermediary in July 2003, MBA Polymers had a signed letter of intent within three months. "The relationship was a good one from the very beginning," relates McCombs. "They showed [an] understanding of our business and appreciation of what we had to offer quicker and faster than some of the other companies we were talking to. . . . And so for them to be able to move as quickly as they did told us that they were really interested in our project." MBA Polymers holds a 55% interest in the joint venture; its partner has 45%.

Biddle believes the Chinese government "is so supportive of us" not only because his is an environmentally green company, but also because its processes consume far less water and energy than would a comparably-sized chemical plant turning out virgin plastics.

MBA Polymers figures that more than 5 million metric tons of shredded residue from appliances, automobiles, office equipment and computers are discarded across the globe each year and could be recycled using its process technology. Its Richmond, Calif., headquarters is a demonstration and research operation of 45,000 square feet and 21 employees.

About the Author

John McClenahen | Former Senior Editor, IndustryWeek

John S. McClenahen, is an occasional essayist on the Web site of IndustryWeek, the executive management publication from which he retired in 2006. He began his journalism career as a broadcast journalist at Westinghouse Broadcasting’s KYW in Cleveland, Ohio. In May 1967, he joined Penton Media Inc. in Cleveland and in September 1967 was transferred to Washington, DC, the base from which for nearly 40 years he wrote primarily about national and international economics and politics, and corporate social responsibility.

      McClenahen, a native of Ohio now residing in Maryland, is an award-winning writer and photographer. He is the author of three books of poetry, most recently An Unexpected Poet (2013), and several books of photographs, including Black, White, and Shades of Grey (2014). He also is the author of a children’s book, Henry at His Beach (2014).

      His photograph “Provincetown: Fog Rising 2004” was selected for the Smithsonian Institution’s 2011 juried exhibition Artists at Work and displayed in the S. Dillon Ripley Center at the Smithsonian Institution in Washington, D.C., from June until October 2011. Five of his photographs are in the collection of St. Lawrence University and displayed on campus in Canton, New York.

      John McClenahen’s essay “Incorporating America: Whitman in Context” was designated one of the five best works published in The Journal of Graduate Liberal Studies during the twelve-year editorship of R. Barry Leavis of Rollins College. John McClenahen’s several journalism prizes include the coveted Jesse H. Neal Award. He also is the author of the commemorative poem “Upon 50 Years,” celebrating the fiftieth anniversary of the founding of Wolfson College Cambridge, and appearing in “The Wolfson Review.”

      John McClenahen received a B.A. (English with a minor in government) from St. Lawrence University, an M.A., (English) from Western Reserve University, and a Master of Arts in Liberal Studies from Georgetown University, where he also pursued doctoral studies. At St. Lawrence University, he was elected to academic honor societies in English and government and to Omicron Delta Kappa, the University’s highest undergraduate honor. John McClenahen was a participant in the 32nd Annual Wharton Seminars for Journalists at the Wharton School at the University of Pennsylvania in Philadelphia. During the Easter Term of the 1986 academic year, John McClenahen was the first American to hold a prestigious Press Fellowship at Wolfson College, Cambridge, in the United Kingdom.

      John McClenahen has served on the Editorial Board of Confluence: The Journal of Graduate Liberal Studies and was co-founder and first editor of Liberal Studies at Georgetown. He has been a volunteer researcher on the William Steinway Diary Project at the Smithsonian Institution, Washington, D.C., and has been an assistant professorial lecturer at The George Washington University in Washington, D.C.