By: Stephen Downer
August 6, 2012
A chance meeting five years ago between grinding entrepreneur Octavio Victal Jr. and a senior prison social-rehabilitation official has blossomed into an $1 million-plus annual plastic bottle recycling business that appears to be unique in Latin America.
Tecnopenales SA de CV operates from inside the Centro Integral de Justicia Regional Puerto Vallarta, one of five penitentiaries in the western Mexican state of Jalisco. The prison has 1,000 inmates, 100 of whom are employed by Tecnopenales’ founders: Victal Jr., a university graduate in marketing, and his father, Octavio Victal Sr., a heart surgeon.
Since setting up the company in February 2009, the pair has invested $1.1 million in equipment. They buy commingled bales of PET, polypropylene and high density polyethylene bottles and reprocess 280,000 pounds every four weeks.
“Our current capacity is 360,000 pounds of mixed bales per month and we’re pushing to reach 400,000 pounds a month by mid-August, which is as much as 65 percent of all the plastic recovered from the city [of Puerto Vallarta],” Victal Jr. said by email.
About 200,000 pounds of the material is clear PET, which is hot-washed, he said. The rest is sold as dirty regrind to Asia.
Tecnopenales doesn’t have its own license from the Chinese government, he said, so it sells to major U.S. brokers like Avangard Innovative Ltd. of Houston and Siwin Corp. of Compton, Calif. The necessary license from AQSIQ — which stands for General Administration of Quality Supervision, Inspection and Quarantine — is a Chinese government norm designed to ensure that imported waste complies with environmental protection standards.
Eighty-five percent of Tecnopenales’ production is exported to mainland China or Taiwan. Natural HDPE and PP from the company’s floating tanks, used to separate PET from HDPE and PP, is sold locally.
The company generated sales of $1.2 million in 2011. In June it invested $170,000 in new machinery, which the Victals expect will enable Tecnopenales to process 100 percent of the city’s recovered plastic bottle waste and drive its annual sales to $1.8 million.
The new machinery, purchased from Repet Inc. of Chino, Calif., includes two centrifugal washers, a prewashing trommell with hot water, sorting belts and de-labeling machines.
According to Victal Jr., Tecnopenales plans to open similar facilities in at least three more of Jalisco’s jails by 2014 in a joint venture with one of the company’s current customers. Other major customers include Grupo Simplex SA de CV of Monterrey, Mexico, and Topwell Group Unit Co Ltd. of Taipei, Taiwan.
Victal Jr. started in the plastics sector seven years ago with his own small grinding operation in Puerto Vallarta, where he employed 20. At a 2008 seminar organized by Mexico’s environment and sustainable development ministry, Secretaría de Medio Ambiente y Desarrollo Sustentable, he was approached by an official of Injalreso (Industria Jalisciense de Rehabilitación Social), which seeks work opportunities for prison inmates.
“He wanted to recycle the plastic produced inside the state penitentiaries,” said Victal Jr. “I started to look into their scrap volumes, especially in the Puerto Vallarta prison, and I told the officer the volumes were insufficient to justify a big investment, but we came up with a second plan.”
The plan was to process not only the prison’s plastic but as much of Puerto Vallarta’s as the Victals could get their hands on. They signed a contract with the state government for 15 years.
Their first investment was in a cold-wash line for PET and a couple of grinders. The grinders include a Nelmor and a Chinese brand. A Mexican company called Tecnorec SA de CV supplied the original cold-wash line. The line has been modified to incorporate hot-wash tanks and equipment, complemented by Kongskilde aspirators and metal-detection devices from Bunting Magnetics Co.
Tecnopenales was fully operational by June 2009, with 40 inmates working in the plant. In an attempt to increase quality and capacity, Victal Jr. contacted Steve Alexander of the Association of Postconsumer Plastic Recyclers. Alexander, who is now APR president, “introduced me to many people who have directly or indirectly helped in the growth of the company,” he said.
The inmates employed by Tecnopenales have been found guilty of a variety of crimes, ranging from larceny to drug dealing to homicide, according to Victal Jr.
The penitentiary’s psychology department and a security council selects them for the work and they earn the national minimum wage of 54 pesos ($4) a day. Ten percent of their pay is deducted and deposited in a pension plan for when they are released.
To be accepted, inmates must prove they are nonviolent. Working efficiently can help reduce the time they spend behind bars.
Asked how competent the prisoners he employs are, Victal Jr. replied: “They are highly enthusiastic, for there’s no other work option inside. Most of them are competent and some are highly skilled, thanks to the work they did before entering prison.” The employees include qualified mechanics, electricians, metal-shop workers and welders, he said.