Industry Experts Speak on Paper and Plastic Recycling Trends, Challenges and Opportunities
Wednesday, June 01, 2016
Posted by: Anne Piacentino
Paper and plastic recyclables make up a large portion of recycling programs, and lately those in the recycling industry have been forced to come up with new ways to handle their recyclables that aren’t able to be exported.
With the drop in commodities prices, a decline in the quality of materials and a disinterest from other countries for product exporting, managing recycling in the U.S. has not been easy.
Waste360 recently spoke with Patty Moore, president of Moore Recycling Associates, and Dan Cotter, vice president of CellMark, Inc., to discuss the many trends, challenges and opportunities for paper and plastic recycling.
Moore and Cotter will team up to speak about these important industry topics at WasteExpo on June 7 for their session, “Paper & Plastic Recycling Trends and Markets.”
What are the latest trends in plastic recycling?
Patty Moore: With PET and HDPE bottles, the reclamation infrastructure in the U.S. exceeds the amount of supply that we normally generate and that we have generated in the last few years. The end markets for PET bottles are a little difficult because there is a global oversupply of virgin PET and some of the traditional end markets were based on PET being a lower-cost feedstock.
With inexpensive virgin material coming into the U.S. and with the strong dollar, it’s a little difficult for some buyers to continue to purchase recycled materials when they can get virgin materials more consistently and inexpensively.
For mixed resin material, the amount that we are generating and processing continues to grow. China was buying a lot of the mixed resin material, segregating it and then converting it into higher value products, but the country has slowed down on this process due to import restrictions and tighter environmental controls.
Polystyrene recycling is growing, and Moore Recycling Associates has put together a map of all the drop-off and curbside programs around the county for foam polystyrene. Even though the price is down, it still has significant demand because it’s a natural material that’s not colored, which means you can do a lot with it.
What are some current plastic recycling challenges?
Patty Moore: Due to the greenhouse gas issues, we are seeing that there is a desire by some consumer product companies to use recycled content, which is a little tough right now with the global oversupply of virgin material due in part to the slowdown in the economy in China. China overbuilt its virgin capacity for its current demand and because of that we are seeing low-cost virgin material coming onshore. But even though the economy in China has slowed, it hasn’t stopped growing. It’s still growing at a pretty healthy rate so we expect the demand there to catch up with the available supply sometime in the next few years. In the last few weeks, we have seen China deplete its inventory of recycled bales, and some buyers are stepping back into the market in a cautious way.
I think that the issues of global oversupply of virgin material are temporary because we expect to see some normalization and that will take some of the older, lower-efficiency facilities offline. The normalization we expect to happen will hopefully help bring value back into the recycling arena.
On the material side of things, we need to work on the infrastructure for polyolefin film because that’s a material that China was buying at a high price so we didn’t develop a proper infrastructure in the U.S. to deal with that material.
Currently, Moore Recycling is working on a project with multiple funders and associations to try and identify the potential end markets and possibly find buyers who hadn’t traditionally used the recycling market for purchasing materials.
What are some opportunities for increasing and improving plastic recycling efforts?
Patty Moore: In the U.S., we have a very robust collection network for film and bags through retail drop-offs. Using a reverse distribution system, the drop-off locations send the material back to their distributors and sell it from there. These programs tie in nicely with the bring your own bag concept because it’s the same behavior change. This is a low-cost way for retail outlets to capture material, and it doesn’t cost communities anything. The only downfall of these drop-offs is that the material bans popping up around the U.S. are causing some stores to stop the film and bag drop-offs since they no longer have a need or desire to set up these programs. The biggest opportunity to increase film recycling is commercial material. We need to continue to build film recovery efforts on existing networks such as distributors, anchor stores and community rehab facilities. Commingled recycling of commercial material is a challenge for film recovery. Like organics, it’s a material that needs to be source separated.
Moore Recycling is also focusing on the issue of terminology for plastic recycling because that’s one of the things that confuses people the most. For example, you can have a MRF that’s accepting materials from different communities and those communities may relay different information to residents about the types of plastic that they accept.
In an effort to resolve this issue, we worked with hundreds of recycling coordinators across the country to get feedback about terminology to create a program called Terms and Tools, which provides common terminology for community recycling programs throughout the U.S. and Canada to use with residents when communicating about plastics recycling.
Where is the future of the plastic recycling sector heading?
Patty Moore: We are seeing some recovery in the pricing and while crystal balls are never 100 percent accurate, I think we have hit the bottom and will likely continue to see very slow improvements in pricing.
Also, I believe that more and more plastic recycling programs will come online because of the issue of plastics in the ocean, which is happening because of poor solid waste systems in different regions of the world. I think that there’s an understanding that the solid waste systems that will be put in place need to have recycling as a component of them to avoid plastics and other materials from ending up in our oceans.
While the eastern half of the U.S. remains strong with the mixed resin infrastructure, I am hopeful that it will expand in the western part of the U.S. so that we can handle the mixed resin material, sort it and high grade it to send to buyers around the country.
What paper recycling trends are you seeing?
Dan Cotter: Due to comingled collection in residential waste streams, the quality of paper is going down, especially in news grades. The quality drop in news grades is mostly due to the fact that there’s very little news print left in the residential waste stream because people aren’t reading newspapers as often as they used to. The lack of newspapers being read and the lack of newsprint mills have also caused a change in the specs for the PS standards.
Clean News, which has the lowest amount of contaminates and the highest level of news in it, is primarily coming from the dual-stream programs and sorted residential waste streams. This offers a good quality mix of paper, which affects both suppliers and customers around the world.
As domestics grow, markets are moving away from exporting items. For example, Europe is actually exporting less because its domestic capacity is growing.
Even though we have seen an increase in the percentages recovered, we are seeing a consistent trend of volumes reducing the total of recovered fiber because people are consuming less. The only grade where consumption seems to be increasing is in the packaging grades, which is primarily due to online shopping and the packaging that’s used to ship products to residences.
What does the future hold for paper recycling?
Dan Cotter: Currently, all the paper grades are moving and the demand is reasonably strong. And even though the commodities prices have come down, they are still higher than they should be based on what the sell price is for customers. There won’t be any quick recovery in the commodities prices in the U.S. for scrap being exported, and I think we are going to be sitting near these current levels for a while longer.
Volumes are going to continue to drop because there will be less consumption and production of all paper grades. There’s still a huge overcapacity around the world, and some of it will have to be shut down.
Countries that we traditionally export to will increase their own collection programs, which will cause a minimal export demand for U.S.-recovered fibers. But we will see demand grow domestically in the U.S. and that will help pick up the slack for the lost demands in the export markets.