Coming to Terms! Are Competitive Terms the Real Terms?

A long 35-year career in the precious metals industry has taught me many invaluable lessons. I’ve learned that you cannot over-react to the many market changes we have seen during my long time in the business. I’ve come to know that all precious metals bearing material has value that is re-claimable. I have found out that precious metal value exists in many household items that we never would have expected. And I have learned through contact with a great number of precious metals industry leaders that integrity should be the constant goal of all processors of precious metals bearing materials.

This final point has become a topic that has driven me during my long career and remains strongly within me as my working days come nearer to the end. I have come to learn that many PM companies do not actually share my thoughts on metal integrity and/or my commitment to customer satisfaction. Many companies have overbearing bottom lines due to high operating costs and can and will do anything possible to secure business opportunities in any manner.  That includes the offering of refining/processing terms that are considerably lower than the industry standards (lower treatment charges and higher percentage returns, etc). This “low terms battle” has left our industry fighting to make any real profit as the margins have been cut so much. But refining terms are only a part of the overall equation when customers are offered their settlements for their PM scrap. The actual customer settlements should be derived as the result of a full assay on their material. However, with these drastic reductions in refining terms, where it looks like a customer is paying way less to have their material processed/refined, the truth is that a larger number of customers are actually receiving settlements based on imaginary assay numbers simply known as “desk assays”! These “alleged” assays protect many processors/refiners by insuring their profits when measured against lower terms. Remember…operating costs must be paid before a company can realize a profit and this money must come from somewhere. Why not use a portion of a customer’s metal value to pay the bills? This has become an unfortunate reality in the precious metals industry that absolutely no one speaks about.

I have been extremely fortunate to have worked my entire career for companies that do not operate in this manner. These companies may have offered customers refining terms that are at least a bit higher than many other terms being offered for the same materials. But these materials were put through a full material preparation process that produced homogenous samples that were analyzed both mechanically and by hand to produce a 100% accurate assay that was used as the backbone of a customer settlement. We have offered samples to our customers whereby the customer could analyze their own sample using an independent laboratory to be used for a net value comparison. The proper process/sample of PM material with size reduction down to a homogenous sample followed by a full assay is the very heart of the precious metals industry and should be the goal of every person looking to get the actual value for their PM bearing scrap.

My long journey in the precious metals industry has brought me to PGM Recovery Systems of Murrieta, CA where I am happy to work with Edmund Schwenk and Terry Solomon who I have known for many years. We pride ourselves on working with our growing customer base to ensure the very best net metal value returns for their automotive scrap which includes catalytic convertors and oxygen sensors. We partner with Sibanye Stillwater Mining of Montana who are the largest processor of auto catalyst precious metals scrap in North America. Stillwater processes and assays our customer material within their state-of-the-art facility in a very timely manner. It would be my personal honor to work with any prospective customer who is looking for a better return for their automotive scrap. But please remember one thing….it is not the terms but the actual assay that really matters!!

David E. Wood • 856-812-3300

David previously worked at Johnson Matthey Inc., in West Deptford, NJ for 27 years with a variety of roles that included: logistics, inventory control, production management, sales management and field sales. After that he worked at MST/QML in Providence, RI for 6 years as a Business Development Manager.