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Recycling: How these small businesses make millions selling aluminium monthly

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Waste Management and Recycling in Nigeria

As an emerging economy with a population of nearly two hundred million people, Nigeria generates quite a lot of waste. The Waste Management Society of Nigeria (WAMASON) estimates that nearly sixty-five million metric tonnes of waste is generated in the country per annum. This has often caused a waste management crisis, especially in most urban centres where municipal authorities struggle to efficiently dispose of trash. Meanwhile, despite the fact that most Nigerians typically regard waste as completely useless, there exist some business-savvy entrepreneurs who have recognised the immense potentials in waste management and have taken steps towards harnessing it.

What is recycling?

Simply put, recycling entails the conversion of waste materials into new, useful products. The essence is to reduce over-dependence on raw materials for the production of new products. It is also one of the most effective ways to managing waste; preventing pollution, ensuring a clean and healthy environment and creating wealth.

In Nigeria, the recycling industry is still in its infancy compared to what obtains elsewhere in the world. BioEnergy Consult estimates that out of the millions of metric tonnes of waste generated every year in the country, only a fragment of it is being managed/recycled. What this means is that the business potentials of recycling are currently being under-utilised. There is need for more investment in the sector.

Waste Management and Recycling in Nigeria

A Cleaner Lagos waste drum filled with overflowing garbage somewhere in Iyana-Ipaja, Lagos.

The recycling business in Lagos: an insight

To understand more about the recycling industry in Nigeria, we visited the Igando Dump Site in Lagos. Located along both sides of the Igando-LASU road, it is one of the many dump sites that abound in Lagos, and indeed one of the biggest in Nigeria and the world at large. From afar off, one can perceive the pungent smell of rot that emanates from the place. Here, solid waste from such Lagos environs as Iyana-Ipaja, Egbeda, Ikotun, Isheri, etc. are brought and literarily dumped. It is also in dump sites like this one that most of the recycling efforts take place.

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Recycling involves a long chain of business command, beginning from the dump sites. For instance, the Igando dump site is privately owned and managed; just like most of the other sites in the city. Scavengers are charged the sum of  ₦200 daily before they can come in and pick valuable recyclables ranging from metals, plastics, etc. Several hundreds of labourers work here daily, and the materials that they recover from the waste dump site is then purchased either by middlemen who sell them to recycling companies or by representatives of the recycling companies.

One of the people we met at the dumpsite is a woman who works in the procurement department of a recycling company. Although she chose anonymity and refused to disclose the name of her organisation, she did reveal that hers is one of the biggest recycling plants in Lagos and that they specialise in metal recycling.

“We basically recycle aluminium/metals and use them to produce new things such as pots, plates, spoons, etc. I work in the procurement department of my company. So it is my work source for production materials. This is one of the places I come to source for materials” the woman said.

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Waste management and recycling in Nigeria

Inside the waste dump site at Igando area of Lagos, one of the biggest dump sites in the world. Thousands of people work here daily, scavenging for valuable materials that can be recycled.

How lucrative is recycling as a business?

Today, the recycling industry is estimated to be worth several billions of Naira. But this is nothing compared to the revenues it has the potential to generate should the right investments be made. In the meantime, however, it was important for us to find how this much money is generated from waste materials, and who gets what. So we began by asking the procurement woman how much it costs to purchase the materials, she said that it depends on the type, quantity and quality that someone is buying.

“Measurement is also very important in this business. We weigh everything in weight” she said. “I pay between  ₦40,000 to  ₦45,000 for just one ton of metal. So depending on the quantity of metal I am buying, I can sometimes spend nearly half a million naira in a single day. Today alone, I’ve transferred  ₦400,000 to that man over there.”

She also revealed that aluminium is more expensive than scrap metal, noting that while the price of a ton of metal is around the  ₦40,000 mark, one tonne of aluminium can cost more than one hundred thousand Naira (₦100, 000).  She went further to state that metals and aluminium are the most expensive recyclables in Nigeria due to the unavailability of iron ore for steel-related productions.

“All the other materials are equally just as important. Some specialise in recycling plastics, polythene bags, PET bottles and even paper. All of these are important materials used to produce some of the important household items that are very expensive in the market. However, the other recyclables are not as expensive as aluminium and metal. Take, for instance, rubber is easily accessible as a raw material, unlike ore which is scarce.”

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Assorted plastic bottles packaged in a sack and ready to be sold and recycled.

Assorted plastic bottles packaged in a sack and ready to be sold and recycled.

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Who gets the money?

Fortunately or unfortunately, a bulk of the money goes to the middlemen instead of the labourers who do the dirty, most intense job of scavenging the materials from the waste dump site. According to our source, some of the labourers earn between ₦30, 000 to ₦50, 000 per month. And in all fairness, this is absolutely nothing compared to the serious work they put in, as well as the many health dangers they could be exposed to in the course of doing their job.

The challenges/opportunities for investment

Indeed, recycling is a lucrative business in Nigeria today. Yet, there exist such endless opportunities that are yet untapped. There is there need for investors to come and industrialise the sector in order make more money from it. Investing in proper waste management processes is one of one way to start. In Lagos State today, much of the 13,000 metric tonnes of waste generated daily is left unmanaged. Investing in the technology that would ensure an effective management of waste, which will inevitably aid the recycling process.

Assorted plastic bottles packaged in a sack and ready to be sold and recycled.

Sacks of plastics packaged and ready to be sold and recycled.

Emmanuel is a professional writer and business journalist, with interests covering Banking & Finance, Mergers and Acquisitions, Corporate Profiles, Brand Communication, Fintech, and MSMEs. He initially joined Nairametrics as an all-round Business Analyst, but later began focusing on and covering the financial services sector. He has also held various leadership roles, including Senior Editor, QAQC Lead, and Deputy Managing Editor. Emmanuel holds an M.Sc in International Relations from the University of Ibadan, graduating with Distinction. He also graduated with a Second Class Honours (Upper Division) from the Department of Philosophy & Logic, University of Ibadan. If you have a scoop for him, you may contact him via his email- [email protected] You may also contact him through various social media platforms, preferably LinkedIn and Twitter.

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  1. Precious

    July 13, 2020 at 3:45 pm

    Want a contact to sell recyclables

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MSME

Payroll Support Program: FG pays 101,567 beneficiaries first-month salary

The President announced thousands of beneficiaries received their first monthly payment from our Payroll Support Program.

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Payroll Support Program, President Buhari appoints 9 Chief Executives for government agencies, Nigerian British firm, Bail-Out Fund: FG deducts N122 billion from states’ account in 7-months [Full-List] , JUST IN: Buhari submits 2020 MTEF to Senate , FG to intervene in tech operation as lockdown causes chaos in tech market

President Muhammadu Buhari has announced that 101,567 beneficiaries, drawn from 16,253 businesses, received their first monthly payment from the Payroll Support Program yesterday.

This information was disclosed in a tweet by the official Twitter handle of the President.

READ: FG to slash import duties on tractors, buses, others in 2020 Finance Bill

READ: NCC tops lists of 25 most ethically-compliant regulators in Nigeria

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The President also disclosed that the program is an initiative by the Federal Government of Nigeria to ensure that Nigerian MSMEs survive, as the Federal Government supports qualifying MSMEs with staff salaries for 3 months.

READ: How FG saved over N206 billion in 2 years -IPPIS

Why this matters

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The stimulus package would go a long way to assist businesses in averting massive job loss or a crash of the business enterprise. The fund is expected to place affected businesses, which are beneficiaries of this fund, on the path of survival and sustainable growth.

READ: FG says 174,574 successfully register for N75 billion MSME survival fund in 48 hours

What you should know

In July, Nairametrics reported that the Federal Government had announced plans to roll out a N2.3 trillion stimulus package and survival fund for Micro, Small and Medium Enterprises (MSMEs) to stay afloat amid the economic challenges imposed by the pandemic.

READ: FG proposes a reduction of minimum tax rate next fiscal year

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The stimulus package, which is under the National Economic Sustainability Plan (NESP), includes payroll support for three months and guaranteed off-take schemes, among others.

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A month ago, Nairametrics reported that 70,000 businesses in Nigeria had been shortlisted from the 432,000 businesses that applied for the Payroll Support from the Federal Government’s Survival Fund Grant Scheme.

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MSME

Development Bank of Nigeria disbursed over N150 billion in 3 years

52% of loans disbursed by Development Bank of Nigeria in 2019 were to youths and women-owned businesses.

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Development Bank of Nigeria , Companies Allied Matters Act (CAMA)

Development Bank of Nigeria has disbursed over N150 billion since 2017 through twenty-seven (27) participating financial institutions, impacting close to 100,000 MSMEs through the process.

This is according to a disclosure by the Government of Nigeria, as seen by Nairametrics.

READ: CBN’s NCR facilitates N1.2 trillion loan For 155,000 MSMEs

READ: DBN meets SMEs’ financial need with over N70 billion

What you should know

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A verified tweet by the Government revealed that in 2019, 52% of the loans disbursed by the Development Bank of Nigeria were to youths and women-owned businesses.

READ: MSMEs crucial to providing employment to growing workforce – Peugeot Boss

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What they are saying

The Government of Nigeria tweeted “#DYK 52% of loans disbursed by @DevBankNG in 2019 were to youths and women-owned businesses. Since 2017, the Bank has disbursed more than N150 billion through 27 Participating Financial Institutions (PFIs), impacting close to 100,000 MSMEs.”

READ: DMO offers N50 million worth of FGN savings bond for subscription

Why it matters

The recent disclosure is in line with the present regime’s drive to diversify the economy and expand opportunities for youths and women, bridging the social exclusion gap, and ensuring prosperity for all.

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(READ MORE: #EndSARS: CBN says funds in frozen accounts may be linked to terrorist activities)

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The efforts by the Development Bank of Nigeria complements other social programmes introduced by the government and targeted towards Youths and Women, such as the Special Grant to Rural Women, Nigeria Youth Investment Fund, National Young Farmers Scheme, amongst others.

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MSME

FG commences disbursement of N20,000 special grant to rural women

Special grant project will see over 700,000 women empowered with N20,000 each.

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The Federal Government has commenced the disbursement of the N20,000 special grant to women in rural areas of Gombe state.

This is according to a verified tweet by the Federal Ministry of Humanitarian Affairs, as seen by Nairametrics.

Recall that Nairametrics had earlier reported the flag-off of the special grant project for rural women, initiated by the Federal Government, which will see over 700,000 women empowered with N20,000 each.

What they are saying

Commenting on the latest development, the verified tweet reads thus:

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MAKE GOOD USE OF THE CASH GRANT”– Umar Faroq tells Rural Women.

The HM @FMHDSD @Sadiya_faroq has urged rural women in Gombe state to use the one-off cash grant given to them by the federal government to improve the lives of their families.

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What you should know

The rural women’s programme was introduced in 2020 by the Federal Ministry of Humanitarian Affairs, Disaster Management and Social Development as part of President Muhammadu Buhari’s social inclusion and poverty reduction agenda.

It includes the realization of the national aspiration of lifting 100 million Nigerians out of poverty in 10 years.

The Grant for Rural Women is designed to provide a one-off grant to some of the poorest and most vulnerable women in rural Nigeria.

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