Drywall Future

By William Turley, Associate Publisher and Editor

Gypsum drywall is one of the most difficult materials to recycle in the C&D material stream. There are a few reasons for that, including it’s not easy to process and it’s not a valuable material, making market development the most important part of recycling drywall. But anyone who does develop the better mouse trap to process the gypsum, plus can find the markets, will find a ready supply of the material beating a way to their door as there is a lack of opportunities to recycle drywall. So many in the building construction industry want to recycle it because of green building standard requirements, success if possible.

DRS Inc. of Woodinville, Wash., thinks it has that mousetrap, plus the other expertise for successful gypsum board recycling, which is why it’s the only infeed material it recycles. “There are thousands of wood, concrete, asphalt and roofing recyclers in the world, but only a handful of drywall recyclers,” said Daniel Guimont, a founder of the company. “We saw a niche market that few have tried to master because of all the hurdles and the amount of money it would cost to overcome those hurdles. There is a huge need to recycle gypsum and our landfills don’t need any more gypsum in them.”
He pointed out that some countries, such as Canada and a few European countries, have banned the disposal of drywall, at least in part because the material is by weight a large part of what goes into landfills. Even though Massachusetts is poised to do its own gypsum disposal ban, DRS thinks the United States is “behind the curve” on gypsum recycling because such a small percentage is recycled. “We saw the opportunity to enter this market and then when the timing is right and we are appropriately positioned, push for legislation to be enacted that would require the recycling of this product.”
To do that the company took the unusual step in C&D recycling of going public and having its stock (DRSX) listed on a stock exchange (OTCQB). According to Daniel Mendes, company president, that process is extremely difficult, time consuming and expensive. “As far as other C&D recyclers are concerned, I would be very wary entering the public markets for any small company. You need to be prepared for a long and draining process, even though many financial professionals will promise you substantial and quick results.”

Even though the company now only has one processing facility, being publicly-owned was right for DRS because “we believe there is a clear and obvious niche for a ‘full service,’ i.e.—installing, hauling and recycling drywall company to attempt to become the national provider of said services,” said Mendes. “We know very well this sort of expansion is feasible in the drywall installation market due to the low barriers to entry and the highly fragmented nature of the drywall industry, but there is a very high barrier to entry into the drywall recycling market because it will take a substantial amount of capital to expand and also a huge financial commitment for any potential competitor for research and development to create a machine such as ours. Because of the costs to expand, we will have to tap into the capital markets in order to properly brand ourselves nationally to create and execute a nationally based marketing model.”

There are four parts of the DRS national model:
•    Collection—DRS uses three types of collection methods daily. One, drop off centers, where customers come and dump their gypsum and save a substantial amount of money over regular dump fees. Two, scrapping, which is when the company supplies trucks to go to a customer’s site and pick up any gypsum debris and bring it back to DRS’ recycling facility. Three, containers/pick-up, containers are dropped off or trucks and customers fill these and call when they are ready to be picked up.
•    Processing—DRS said this is by far the most challenging and costly of the components. All of the gypsum is sent to the processing facility in Ridgefield, Wash. There, its processing system is used to separate gypsum into virgin forms, gypsum powder and paper. It took over a year to negotiate with a company to design, then build, and obtain all required permits including air handling systems, in order to have the machine operational. The effort and money required is substantial and discourages most people from trying to enter the market.
•    Selling—A huge part of making this process work is what is done with the gypsum once it is in its raw form. DRS has its own unique marketing approach that uses drywall manufacturers, the agriculture markets and private sources for both the processed gypsum and paper product that it produces.
•    Advertising—If people don’t know they can recycle a product, they throw it away. A simple example of this is there are thousands of drywall companies still taking their scrap drywall to a landfill and spending as much as $120 a ton to dispose of it. DRS has drop off locations strategically placed in Washington that charge a fraction of the price for that same person to recycle their drywall. A huge hurdle is getting the word out to these companies that this is a cheaper alternative that will also benefit the environment. DRS has found that direct contact with each individual company is best, but is working on a campaign that will reach everyone in a region numerous times a year so that when they have waste drywall/gypsum to dispose of, they know DRS is an alternative to the landfills, and they will actually save their company a lot of money and have it recycled.

Like most drywall recyclers, DRS is very tight-lipped about its processing technique. Guimont said the company has been improving its process by trial and error. The beginning came in the 1990s with machines that just pulverized the drywall, and the drywall manufacturers took that product and mixed it with mined gypsum to create new drywall. The company’s current technology, which it says it can replicate anywhere in the country, removes 99% of the paper from the gypsum for two saleable products; the paper is baled and recycled as an animal bedding, while the gypsum can be used for both land application and new drywall. Only two employees are required on the floor to keep the process going.
DRS faces the same challenges as other board recyclers, including air handling because a fair amount of dust is created by processing. Guimont said its negative air flow dust control system is so good the processing plant can be run continuously with no respirators needed for employees. Those workers need to ensure only drywall is entering the system to protect the end product and not break the recycling machine. Going under roof in a big way is required to set up a large processing system, stage raw material, and store the final products. “Finding a facility zoned for an operation such as ours is a challenge in itself,” said Guitmont.
DRS contends it can process both scrap drywall and demolition gypsum. There is a need to keep the two products separate, and for the demo any state and local paperwork regarding lead and asbestos must be maintained. The new must be processed separately from the old to ensure the saleable soil amendment meets regulatory standards to be used in the food chain.

“Our goal is to have processing in all 50 states,” said Guimont. “We have perfected our system so well that it is easy to create and start up again. We are looking at a handful of potential customers that are willing to buy our processing machines, and we are also looking at expanding into all of these markets ourselves. Right now we feel that gypsum recycling has to be put on the map as a simple and easy product to recycle, so that people are no longer scared of the word gypsum.”

“It is our belief, and we will ultimately push when properly positioned, that legislation will be enacted in the United States to deal with this growing problem,” said Mendes. “It has become much more difficult and expensive for waste companies to open new landfills and gypsum is actually bad for those operations in many ways, including breaking down clay used to contain contaminates in creating a landfill and toxins that gypsum can create. As other countries are recycling this product, the U.S. has continued to ignore the potential and benefit of doing this. The push over the last several years in the U.S., however, has been to establish a “greener” world, by in large part the recycling of different products. Gypsum however has not taken that large step yet and so the door is wide open for a company to do so. The drywall waste generated in the U.S. is too large to be continually ignored and therefore we feel will be addressed soon.”