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The Birth of Reverse Logistics of EEE in Brazil

The Birth of Reverse Logistics of EEE in Brazil

by Salete Pezzo, Commercial Director , Lavra

Reverse Logistics Magazine, Edition 66

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My initial thought was to write an article with the title “A Brief History of Re-verse Logistics of EEE in Brazil”, but I soon realized that even though reverse logistics has been around us for a long time the EEE reverse logistics in Brazil is yet to be introduced. I will explain: Reverse logistics did not catch much attention of the business world until the first ever national waste management legislation - Política Nacional de Resíduos Sólidos n. 12305 (PNRS) – came into force at the end of 2010, following 20 years of discussion.

The main objective of the PNRS is to prioritize a national integrated waste man-agement system under a shared responsibility principle, setting reverse logistics as one of the key instruments to achieve that aim. It is important to mention that states and municipalities must develop their own waste management plans.

Rather than just focusing on recycling, the PNRS goes further, aiming for a circular economy. Defined as an instrument for social and economic development, reverse logistics focuses on encouraging the return of waste materials. When not feasible, waste must be disposed of appropriately.

Soon after the PNRS came into force, a Decree (n. 7404) created the Steering Committee for the Implementation of Reverse Logistics (CORI). CORI then devel-oped five Technical Working Groups . The purpose of each group was to design its own legal sectorial agreement, subject to the Ministry of the Environment’s approval and to establish conditions, targets and obligations to manufacturers, importers, retailers and consumers in relation to the implementation of reverse logistics strategies.

It is estimated that by the end of 2014 there will be around 1.1 million tons per year of WEEE on the market; over 50% of this will be large domestic appliances. It is estimated to increase around 25% in the next three years, before starting declining slightly until 2020 according to ABINEE (Brazilian Electrical and Elec-tronics Industry Association).

The deadline first set for the key players (manufacturers, importers and retailers and consequently consumers) to be legally obligated under the requirements set by the agreed requirements was September, 2013. The first draft of an EEE Sectorial Agreement was delivered in June, 2013. The problem is that up to date the final EEE sectorial agreement setting targets and obligations has not been signed yet.

Some key minimum requirements for the reverse logistics strategies have been set out :17%(weight) of the amount placed on the market must be collected; 100% of the municipalities with a population of over 80,000 must provide permanent bring bank points; 100% of the municipalities with a population of 80,000 must at least implement collection campaigns; the EEE reverse logistics, as a mechanism under the shared responsibility, must be funded, operated and implemented by the WEEE manufacturers, importers and retailers.

The typical EEE Reverse Logistics Process is as follows: CONSUMERS must place their unwanted EEE back into the cycle; private initiatives organize the setting up of bring back banks at suitable sites such as supermarkets, car parks and shops. Companies like LAVRA Logística Reversa de Eletroeletrônicos – devise creative ways to encourage consumers to deliver their unwanted equipment. One way offering to pick up individual consumers’ equipment at home for free for volumes higher than 20kg. Companies are offered customized solutions.

These companies focus on streamlining the process so that the final users, indi-vidual and legal persons, will be encouraged to deliver their unwanted equip-ment properly. DISASSEMBLING SITES (MANUFATURAS REVERSAS) separate the materials to be recycled by RECYCLERS who will transform the materials as needed to be fed directly into the manufacturing industry. Some materials are exported for recovery when recovery is not available in Brazil. These electronic recycling companies, see a lot of opportunity for recyclers!!!!!

Recycling companies are very optimistic and believe WEEE reverse logistics has certainly kicked off. The history of EEE reverse logistics in Brazil is being written.

In early 2014 ABINEE (Brazilian Electrical and Electronics Industry Associa-tion), ELETROS (Brazilian Association of EEE Manufacturers), ABRAS (Brazilian Association of Supermarkets), IDV ( Institute for the Development of Retailers) , ABRADISTI (Brazilian Association of the Distributors of Information Technology) and SINDITELEBRASIL (Brazilian Association of Telecommunication Companies and Mobile and Personal Service Providers) presented to the MMA (Ministry of Environment) a proposal to the implementation of Reverse Logistics systems of WEEE.

The document stresses six points which are to be considered in the implementation of Reverse Logistics systems of WEEE to guarantee security to the obligated parties by the PNRS (consumers, retailers, distributors, manufacturers and importers). The so-called “six points to be discussed” are: 1)establishment of a managing entity with governance system, 2)classification as non-hazardous waste of the EEE after use, 3)establishment of documentation stating the cessation of the right of ownership valid throughout the country, 4)establishment of documentation to permit the transportation of e-waste and products after use throughout the country, 5)commitment of all players in the lifecycle including the ones who have not undersigned the proposal, 6) tax-free fee paid by consumers and compensation for the reverse logistics costs generated by non-branded EEE.

The six questions above have not been answered yet. Because there is overlap-ping of environmental, economic and political issues the Environment Ministry has decided to involve other Ministries in the discussion.

It is very important to mention that there are several opportunities available in the reverse logistics business. For example, thirty percent of LAVRA’s operation costs are covered by selling recyclable material. It is our opinion and expectation that the remaining cost will be paid by the obligated parties which today would be R$1600,00 per ton/US$723 per ton. The total cost will fall by 40% when there is growth in scale and investments.
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