Awhile ago, I subscribed to a listserv regarding recycling issues for my good ol’ homestate of Mass. Every now and then there are some interesting tidbits that are shared. Thought that this deserved to be passed along to the Sietch network.

Here from the MassRecycle listserv…

1. Recycling Market Woes (IMPORTANT!)
Posted by: “Ann Dorfman” dorfmanann@comcast.net
Fri Nov 7, 2008 11:55 am (PST)

You may be wondering how the global financial crisis is affecting recycling.
The situation has created very serious problems in the recycling industry. I
thought I would share with you a well written piece about the status of
recycling that David Biddle, Executive Director of the Greater Philadelphia
Commercial Recycling Council, sent to his membership (I have not included
the second half of his posting which contained information directed more
specifically to people in his region).

Ann Dorfman
Recycling & Resource Management Consulting
9 Henshaw Street, Newton, MA 02465
O: 617-244-9321
C: 617-413-4901
F: 617-446-1431
ann_consulting@ comcast.net

++++++++++++ ++++++

Recycling Market Frenzy

Some of you may know that recycling markets in the US have now succumbed to
the volatility of the global economy. Virtually every major recycled
commodity saw dramatic price reductions over the past 10 days. Fiber
products in particular have taken a gigantic hit. Cardboard in the Northeast
crashed from $120/ton to $30/ton in one week. Mixed paper dropped from about
$50/ton to $5. Newsprint has also fallen from about $60/ton to $5/ton. Metal
prices have tumbled too. Light iron is down more than 90% sitting around
$10/ton. Plastics haven’t taken a huge hit yet, but they may…

More importantly, we have spoken with a number of processors and brokers in
the region and they’re having a hard time. This precipitous fall in fiber
prices essentially means that they cannot move a good deal of their material
without losing an immense amount of money. As such, some are warehousing
their product. Some are putting recycling accounts on hold. Some are now
charging as much as $25/ton to accept material at their docks.

Most of my colleagues in government and the industry are not surprised by
this situation. Global demand for manufactured goods has decreased. China
and India have effectively stopped buying recycled material from overseas
and are willing to survive on the inventories they built up over the past
year. Shipping costs are extreme and credit is tight. We may have hit the
bottom here, or we may be in for further price reductions. No one knows.

There are other factors at play as well. Obviously we’re looking at a
recycling economy in a state of major shock. The biggest shock comes to
those dependent on export transactions. Recyclers with domestic mill
accounts can at least move material even if they aren’t going to make much
money. Domestic mills are very likely ecstatic that they can now get
feedstock at such cut-rate prices. This means, of course, that they can pick
and choose who they do business with and demand only the highest quality
furnished material.

What is important to remember in all of this, however, is that recycling
economics for businesses and facilities is first and foremost about saving
money on trash disposal costs. Over the next year or so you may not get
those rebate checks that are always a blessing. You may in fact have to pay
a bit more for recycling services. But if you’re smart, you will not have to
pay the $65-$75/ton to landfill or incinerate your recyclables. Allowing a
recycling program to falter or fade away because of additional cost would be
a mistake because you’ll just pay more to dispose of material that is now
trash. And, of course, the markets will indeed eventually turn around. It’s
costly and time consuming to ramp up to speed again. Remember, too, that
recycled content products are more energy efficient than products made from
virgin resources. Recycling is part of our energy independence equation –
and part of the fight against global warming.

David Biddle, Executive Director

Greater Philadelphia Commercial Recycling Council
P.O. Box 4037
Philadelphia, PA 19118
215-247-3090 (desk)
215-432-8225 (cell)