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NWRA director: 'Recycling markets are no longer supply and demand'

Tuesday, December 08, 2015   (0 Comments)
Posted by: Anne Piacentino
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Source: WasteDive
By Arlene Karidis | December 7, 2015 Printprint

Dive Brief:
Earlier this year, virgin plastic used in soft drink and other bottles was 72 cents per pound, compared with 64 cents per pound for recycled plastic, according to Plastics News. The recycled materials' reduced value is the result of cheaper oil used to manufacture new plastic. Lower energy costs have also driven down the cost of other recycled materials such as aluminum and paper, which are also cheaper to manufacture as new, said Chaz Miller, director of policy for the National Waste & Recycling Association.

Ultimately, industry experts point to China’s slow economy and reduced demand for imports, and also tie the recycling hit to stricter regulations on imported recyclables. Plastic News reported in May that 70% of recycling companies have left China in the last three years.
Among many recent examples of how the downward spiral is hurting recyclers is Lake Area Disposal’s forced decision to close a drop-off center in Springfield, IL this month. Still, some landfill operators in Illinois are seeking approval to separate and store recyclables on-site, anticipating an eventual market recovery.

Dive Insight:
Recycling, intended to reduce landfill burden, once meant big opportunity for those who collect, clean, separate and sell the materials. But as more municipalities accept more materials, the plan has backfired for many entrepreneurs who accept all kinds of materials, especially those in the scrap metal market as of lately.

Miller explains that recycling has "been a victim of its own success," according to the State Journal-Register.

"One of the unfortunate results right now is overproduction," he said, "There is just too much supply ... In the past, when demand lagged, it was easy to turn off the supply. It's hard to turn off the spigot of municipal recycling programs. If you're recycling, it's a good thing, and it's also bad if the end-market demand is not there."

Recommended Reading
The State Journal Register: Cheap oil, oversupply of recyclables make for a losing operation

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