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Firm looks to diversify recycled product range, seeks new markets

23rd February 2024

By: Lumkile Nkomfe

Creamer Media Reporter

     

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Germiston-based rubber recycling company Dawhi Rubber Recycling, which has been in the rubber crumb business for 14 years, is conducting research into new innovations such as tyre-derived fuel, which represents the primary alternative to rubber crumb manufacturing and reclaimed rubber. 

“Tyre-derived fuel is the direction many companies would like to pursue – converting tyres into oil. There is greater demand for it when compared [to] . . . rubber crumb,” says Dawhi factory manager Gilberto de Nobrega.

“The reason why we are still afloat as a business is because we give the public what it wants. We give customers the right products and our quality is excellent, but because our current market is so small and niche, we cannot expand on the crumbing side. We need to find an alternative and that alternative is the oil sector and rubber compounding sector.” 

Ultimately, an emphasis on broadening Dahwi’s business has been highlighted as a means of generating a greater appetite for rubber recycling products. 

The company, which processes waste tyres and converts the waste materials into rubber crumb and scrap metal, has derived many benefits from being one of the few recycling and manufacturing companies to continue operating in a niche market, owing to many entrants being unable to grasp the complexities of operating a rubber recycling plant.

It operates out of a small factory and processes tyres delivered from the Waste Bureau – an implementing body of the Department of Forestry, Fisheries and the Environment. 

This year could underscore a positive challenge for the rubber recycling company, as it embarks on its journey to diversify its product range and enter new markets, says Dawhi owner Maggie Wang.

She notes that the company’s primary market is the construction sector, which uses Dawhi’s rubber crumb as an additive in asphalt.

“We are in a small market, so the fact that we are able to manufacture recycled products and keep up with the demand speaks volumes.” 

The company has orders for rubber crumb in place until the end of March, but also highlights the reluctance of companies in the construction sector to work on new projects, owing to the uncertainty regarding the economy and the scope for new projects, which can be attributed to the upcoming national elections.

Policy Challenges

Wang attributes the lack of growth in the broader rubber recycling industry to inefficiencies in the public sector. 

She laments the lengthy and costly process of obtaining environmental impact assessment authorisations and high electricity tariffs as significant challenges to the successful operation of rubber recycling companies. 

“The industry in South Africa is not a competitive one. While we have a relatively healthy order book, there aren’t enough end-user markets into which to sell our products. Consequently, if one wants to sort out the waste tyre problem, they must develop some more industries to buy recycled products from our little industry, but there aren’t many players looking to do so.” 

Wang also highlights a lack of innovation in the regulatory framework of the rubber recycling industry as a developmental impediment. 

She expresses discontent over the Industry Tyre Waste Management Plan and the delays in its implementation, alluding to the insufficient subsidies the company received from the Recycling and Economic Development Initiative of South Africa (Redisa).

“We had only received 31c/kg before Redisa was taken over by the Waste Bureau. Since then, we have yet to receive a cent from them.”

She suggests that, if the Waste Bureau and other government entities do not act to create a   more enabling environment for businesses, such as Dawhi, the tyre waste problem will not only continue unabated but the recycling industry will also continue to struggle.

However, the company is doing its part to try to develop the sector, asserting that it is prioritising efficient practices in its operations, and investigating potential innovations to enter new markets, which could lead to the improvement of the broader circular economy.

Edited by Nadine James
Features Deputy Editor

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