(Kitco News) - Elevated platinum group metal (PGM) prices have led to a surge in catalytic converter thefts in the U.S. While the Federal government is attempting to address this issue, the proposed legislation could create more problems than it solves.
The Senate is currently considering amendments to the proposed "Preventing Auto Recycling Theft Act" (PART Act), which could restrict the recycling of platinum, palladium, and rhodium—three critical precious metals used in catalytic converters to reduce harmful emissions from gasoline and diesel-powered vehicles.
The amendments would add traceability measures and regulations that could indirectly burden the recycling sector. However, the Recycled Materials Association (ReMA) and the International Precious Metals Institute (IPMI), the leading trade associations for the precious metals recycling industry, have voiced opposition to these proposed amendments.
“While we share the goal of preventing catalytic converter theft, we believe the amendment as written will have unintended consequences detrimental to the industry. We have been actively collaborating with all relevant stakeholders to refine and improve the PART Act to better align with its intended goals” wrote Robin Wiener, President of ReMA, and Larry Drummond, Executive Director of IPMI, in a joint letter to Congress.
The letter noted that the amendments could deprive the domestic U.S. smelting industry of approximately 30% of its raw material inputs.
“Each year, recyclers of used automobiles across the United States lawfully purchase and process over 30 million spent catalytic converters, returning $3 billion worth of precious metals to the manufacturing supply chain,” Wiener and Drummond stated. “These metals are crucial for manufacturing a wide range of products, from biomedical supplies and capacitors needed for data center growth, to new catalytic converters and more.”
In a comment to Kitco News, Jonathan Butler, President of IPMI, emphasized the crucial role the recycling industry plays in supporting various sectors of the economy.
"Our industry is a key player in the circular economy, ensuring that precious metals are recovered and reused," Butler stated. "Any disruption to this process would have far-reaching consequences for industries ranging from automotive to technology and beyond. It’s important that legislation addresses theft without placing undue burdens on these critical industries."
Although thefts have been declining since mid-2023, more than 26,000 catalytic converters were reported stolen last year. Both ReMA and IPMI have been working with federal legislators and law enforcement agencies to reduce these thefts.
“We believe that limiting purchase points, mandating traceable forms of payment, and clearly defining who may legally possess detached catalytic converters are the most effective ways to eliminate the black market fueling this crime,” the letter added. “To further this effort, we are assisting with expanding the capabilities of ScrapTheftAlert.com, a resource with a proven history of helping law enforcement recover stolen materials and prevent thieves from selling stolen goods by enabling real-time collaboration between law enforcement and the industry.”
ReMA and IPMI's focus on maintaining access to recycled materials comes as the PGM market faces a significant supply deficit. According to updated projections from the World Platinum Investment Council (WPIC), the platinum market is expected to see a one-million-ounce deficit this year.
“Recycling is expected to reach 1,581 koz for the full year, a 2% year-on-year increase. The spent autocatalyst market is expected to show some signs of stabilizing after two years of declines, supported by improvements in factors that previously disrupted the flow of materials from consumers to scrapyards and from scrapyards to refiners,” WPIC stated in its second-quarter trends report.
