Infrastructure

Using advanced technology to support the circular economy in manufacturing

Macquarie Asset Management is supporting the circular economy through a US scrap metals recycling platform powered by artificial intelligence and advanced sensor technology.

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Sector	Infrastructure
Sub-sector	Recycling
Locations	United States

Opportunity

As a critical material for a range of technologies that are projected to play an important role in the energy transition, it is anticipated the demand for high-grade aluminium will increase across a number of sectors.¹

Increased demand comes at a time when many leading producers and end-users have committed to increase their utilisation of recycled materials.² Despite aluminium being highly recyclable, there is a significant inefficiency in recycling processes. A substantial portion of secondary aluminium is either downgraded to a lower quality or exported for manual sorting.³ By optimising the sorting of mixed aluminium scrap, industry can avoid downcycling, reduce exports and limit the dependency on primary production.⁴

Along with a push for increased use of recycled materials, many end-users have committed to ambitious emission reduction targets.⁵ Aluminium that is produced from recycled scrap aluminium, known as ‘secondary aluminium’ can reduce energy use and emissions by more than 90 per cent compared to primary production.⁶

Approach

In 2023, Macquarie Asset Management (MAM) made an equity commitment in Sortera Technologies (Sortera). The US-based company specialises in sorting of mixed metal waste streams with greater efficiency than current commercial offerings, focusing initially on the aluminium scrap market.

The company's advanced sorting platform is powered by its proprietary sensor technology, machine learning and artificial intelligence (AI) driven software. This innovative approach enables Sortera to efficiently process a wide range of aluminium scrap material by alloy, encompassing both pre-consumer manufacturing scrap and post-consumer end-of-life scrap.

Operating from its facility in Markle, Indiana, Sortera is dedicated to closing the loop in metals recycling and enabling greater use of recycled material in manufacturing.

As an investor and strategic partner, MAM is focused on supporting Sortera across project development and leveraging its expertise in waste and recycling infrastructure to support business growth.

Outcome

Each Sortera facility is expected to process over 100,000 tonnes of scrap aluminium annually. These materials processed through Sortera's sorting technology are returned to the manufacturing stream, contributing to the circular economy and aligning with broader objectives to reduce waste and improve sustainability in material production.

Sortera is focused on continuous improvement and has recently established a research and development facility in Austin, Texas. This centre is aimed at refining its expertise in AI, data analytics, and sensor technology, positioning Sortera to enhance its sustainable material processing capabilities.

Advanced sorting platform

Estimated 100,000 tonnes

of scrap metal/aluminium processed annually

90 per cent

potential reduction in energy use and carbon emissions from secondary aluminium compared to primary production⁶

We are perfectly situated to seize the momentum and success of our technology platform and talented research team to expand our recycling capabilities into additional key materials and industrial applications. This will both expand Sortera's reach as a key player in the mixed alloy industry, as well as establish our leadership role in the global circular economy movement.”

Michael Siemer
CEO
Sortera Technologies

IEA, Aluminium, 11 July 2023.
International Aluminum Institute; Aluminum Industry Backs Action This Decade for Net Zero by 2050; September 2022.
Congressional Research Services; US Aluminum Manufacturing Industry Trend and Sustainability, October 2022; BCG, What’s Holding Back Aluminum Recycling in the US?; May 2022.
Recycle Today; Sorting Technology Can Turn Aluminum Green, September 2021; PA Consulting, June 2023. Higher-throughput and accurate in comparison to off-the-shelf systems by competitors. PA Consulting, June 2023.
According to announcement by end users including Novelis, Arconic, Hydro Norsk, Stellantis, BMW, General Motors, Ford, Apple, Boeing, and other leading aluminum consumers.
The Aluminum Association; The Environmental Footprint of Semi-Fabricated Aluminum Products in North America; January 2022.

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