In response to growing recognition that current economic models contribute to resource depletion, biodiversity loss, waste generation, harmful emissions, and climate change, more organizations are embracing the shift towards circular economy frameworks. These systems aim to maximize efficiency in the use of raw materials, resources, and supplies while creating environmental, social, and economic value. By adopting sustainable production practices, circular models restore and renew resources, improve product quality for the market, and enhance ecosystem health.
In this context, Sociedad de Fomento Fabril (SOFOFA) –the Federation of Chilean Industry–, in collaboration with SOFOFA Hub and the Programa Territorio Circular (Circular Territory Program, an initiative led by Corfo and Chile’s Ministry of the Environment), released the second edition of the Practical Guide for Business Circular Management. This guide highlights exemplary circular economy practices and provides practical, technical insights from participating companies to share and promote replicable circular economy experiences across the business sector.
ME Elecmetal actively contributed to this guide, along with other companies such as CMPC, Anglo American, Collahuasi, Empresas Iansa, Colbún, Asfalcura, Enel, Sacyr, Volta, Emiliana, and Tresmontes Lucchetti. Together, these organizations co-developed a best practices manual based on their shared experiences and evidence from management indicators, creating a valuable resource for advancing circular economy practices.
Globally, ME Elecmetal advances its commitment to the circular economy and optimizes logistics and production processes by recovering metallic by-products, which are then transformed into raw material for the foundries. This is achieved through:
ME Elecmetal South America
By recovering Metallic Raw Material (MRM) directly from customers, ME Elecmetal achieves full traceability, accurate costing, and a clear understanding of material origins, which extends the steel lifecycle and ensures high chemical quality in production while reducing additional greenhouse gas emissions. This approach benefits clients by providing better purchase prices for steel liners and strengthening their Scope 3 emissions management. Through structured Supply Agreements and Scrap Contracts, customers can also enhance their site management, creating a mutually beneficial, sustainable partnership.
The economic benefit of this circular model lies in customers selling their by-products as MRM to ME Elecmetal, while ME Elecmetal, in turn, offers its liners at competitive prices. This mutually beneficial arrangement is supported by a polynomial or pricing equation that reflects the value created through circular operations, allowing customers to also act as suppliers to ME Elecmetal.
The semi-annual recovery process has successfully met 100% of ME Elecmetal’s MRM requirements for sustained operations, while also building a 34% inventory surplus to secure production continuity for several months. Of the recovered MRM, 79% is fully traceable back to its origin, predominantly from ME Elecmetal’s own scrap liners, ensuring a reliable and sustainable source.
ME Elecmetal North America
Using a scrap-recovery model similar to ME Elecmetal South America, the Tempe and Duluth foundries, along with the supply chain team, are currently recovering 77% of the Metallic Raw Material (MRM) required to support semi-annual production. Of this recovered material, 64% is traceable to its original source, reinforcing supply chain transparency and sustainability.
ME Elecmetal China
The Changzhou foundry recovers 98% of the total Metallic Raw Material (MRM) needed from third-party sources, ensuring operational continuity that accounts for 97% of the total semi-annual production. However, only 1.8% of this material is traceable to its origin, primarily due to structural and regulatory challenges, as well as the vast distances and difficulties associated with importing raw materials. Despite these challenges, this situation presents a significant opportunity to enhance traceability by engaging scrap providers upstream and up-cyclers downstream, thereby adding value throughout the entire recovery process.
As a result of this approach and recovery model in the three productive regions: ME Elecmetal South America, ME Elecmetal North America and ME Elecmetal China, the recovery and recycled usage rates during Q1 and Q2 of the current year are:
“Embracing a more circular approach is essential and a core component of our Global Corporate Business Model. By reducing greenhouse gas emissions, minimizing waste to near zero, and significantly extending the useful life of our primary product along with its traceability to origin, we are committing to sustainable practices that benefit both our business and the environment.”
— ME Elecmetal, CEO, Eugenio Arteaga
“We serve as a platform for various companies to explore effective business practices and draw inspiration from them to advance sustainable development.”
— SOFOFA, Director of Sustainability, Ignacio Cobo
“The coordinating role of Territorio Circular between public and private stakeholders, along with our efforts to facilitate the implementation and monitoring of proposed measures in the roadmap, enables us to accelerate the adoption of circular economy models, particularly within the business sector.”
— Territorio Circular, Program Manager, Javier Obach
ME Elecmetal has successfully developed a circular MRM (Metallic Raw Material) recovery model that serves as a vital component of its business strategy. The importance of this model lies in its ability to:
To monitor and manage this sustainable approach, ME Elecmetal tracks three key indicators:
For more details on the ME Elecmetal business case, download the guide.
