Recycled material is worth a lot less than it used to be, which is bad for recycling

  • Rob Childs of Hopkinton separates his recyclables at the Hopkinton/Webster Transfer Station in Hopkinton on Friday. ELIZABETH FRANTZ / Monitor staff

  • Recyclables, including plastics, mixed papers, aluminum and glass, are separated at the Hopkinton/Webster Transfer Station. ELIZABETH FRANTZ / Monitor staff

Monitor staff
Published: 4/5/2016 12:25:27 AM

The world of recycling is struggling through a collapse in prices that shows no sign of ending any time soon, adding unexpected strain to budgets in many towns and cities – although less so in Concord, thanks to some fortuitous timing fueled by a little risk aversion.

“We decided we didn’t want to be in the commodities market,” said Chip Chesley, director of Concord General Services, which includes the solid waste department. “The attractiveness – ‘we can make a lot of money on it’ – may have sucked some people into it, but we decided against it.”

That doesn’t mean recycling in the city is cheap, of course, as is most visible in questions about how much to charge for the purple bags used in pay-as-you-throw. This year it will pay $1.08 million to cover the cost of the trucks and staffing to make curbside pick-up runs.

But it doesn’t have to worry about the numbers changing as the world’s markets for waste paper, glass, tin, plastics and metals plunge.

In the past, such caution could be misguided because it was possible to make money selling material collected from recycling runs, due in large part by the economic boom in China, which bought huge amounts of recycled material to make new products. No longer.

In 2011, the average price for a ton of single-stream recycled material was about $150, said Michael Durfor, head of the Northeast Resource Recovery Association, a nonprofit that helps communities with recycling. In 2015, that was down to about $39 a ton, due to a decline in prices for almost all material because of a perfect storm of problems, including developing-world slowdowns, the fall in the price of oil and the decline in newsprint.

“No one was ready for this to be such an across-the-board down market,” Durfor said. “Typically, if fiber was down, plastic would be up, or if tires were down, scrap metal would be up – there was enough to cover the changes.”

For the effect of this, consider Hopkinton, which recycles the old-fashioned way. People bring their stuff to the dump – which is actually a transfer station, although the old name sticks – and manually sort out different types of paper, glass, metal and plastic. It’s then bundled and sold through Northeast Resource Recovery Association, and since it’s pre-sorted, it gets top prices.

In 2013, Assistant Superintendent of Public Works Steve Clough said, Hopkinton sold various recycled material for $67,000. In 2014, the material brought in $65,000. But last year, the haul was just $30,000, a decline of more than 50 percent, and it’s not because people recycled less.

“We have a good following, a pretty committed town,” he said.

Clough said this revenue decline is less shocking than it seems because recycling reduces the amount of stuff that the town has to pay to take to a landfill. Even if you’re getting much less for each ton of crushed milk jugs or baled cardboard, that’s better than paying money to have it buried somewhere.

“Recycling was always about cost avoidance,” Clough said.

That’s also true in Concord, where Casella Waste Systems has a contract to pick up recycled material along with trash.

This year, Concord will pay Casella $58.36 for each ton for trash that it disposes, and nothing per ton for recyclables. That’s above and beyond the million-dollar cost of pick-up.

In 2015, the city paid to dispose of 8,667 tons of trash and 5,087 tons of recyclables. This means that if it could persuade people to shift 5 percent of their trash over to the recycled category, it would save about $25,000 in disposal costs.

Why isn’t Concord also getting paid for the recycled material? It’s by choice.

Rather than guess how much recycled material is going to be worth in the future, the city signed a 10-year contract with Casella last year that sets costs in stone, with a 2.4 percent annual increase in trash disposal cost. If PTE (plastic that has a 1 inside its recycling symbol) or cardboard or tin cans soar in value next year, the city will miss out on a resale bonanza.

The risk is worth it, Chesley said. He said the city’s “trash geeks,” using former experience in the regional solid waste cooperative as well as recent analysis, decided not to try to second-guess year-to-year market prices. That’s looking pretty good at the moment.

“I don’t know that anybody expected such a long drawn-out decline in the market,” said Adam Clark, solid waste manager for Concord. “When the going was good, maybe the blinders were on for people making a decision. (The market for recyclables) was hot for a long time.”

It’s not hot now, for lots of reasons, none of which show any sign of changing soon.

Problems include the economic slowdown in China, India and other developing nations, which once bought recycled material to reuse; the fall in oil prices that makes it cheaper to create plastic from petroleum rather than from recycled plastic; a strong dollar that makes it expensive to sell recycled material overseas; and even the decline in newspaper circulation and other printed material, which has clobbered the New England paper mills that once bought what is known as recycled fiber.

“In 2009, we lost 11 or 13 mills in New England. We lost another six in the last six months,” said Michael Durfor of the New England Resource Recovery Association.

Asked to describe the economic situation of recycling, he half-joked: “If you can envision the Titanic about halfway down.”

Even technology plays against the finances: Plastic soda bottles weigh less than they used to, so the same amount of recycled bottles will produce less material to be sold.

Then there’s the issue of single-stream recycling, which came to Concord five years ago and is much debated in the industry.

An op-ed piece in the March 20 Sunday Monitor, titled “The story behind the death of recycling,” achieved the solid-waste-industry version of going viral online, drawing more than 70,000 page views and comments from people as far away as the West Coast, many of them identifying themselves as working in the business.

Written by Carl Hultburg of Danbury, who works at the Danbury Transfer Station, it argued that the cost issues have been worsened by companies making big, expensive machinery designed to automatically separate all of the various material that is tossed into the same recycling bin as part of single-stream.

“The brand-new, automated, single-stream plants that hardly had to hire anyone were suddenly clogged up with the refuse in the recyclables stream: car parts . . . plastic shrink wrap . . . dead animals, you name it. Suddenly these high-profit trash handling facilities started breaking down,” he wrote in his piece. “The towns that were expecting to make a huge profit were faced with big bills for extra processing.”

That claim is part of a debate going on in the industry right now. Going to single-stream, which means that people don’t have to keep separate piles of material waiting for the weekly recycling run, greatly improves participation, as Concord found when it adopted single-stream five years ago.

“Everybody said solid waste volume should drop by about 40 percent. We thought it would take maybe two years to accomplish,” Chesley said. “We did it in about two weeks. People’s habits, as soon as they were aware there is a cost to solid waste, they changed.”

But single-stream is expensive, because the separating of different material that was previously done for free by people at home or at the town transfer station is now done at cost by companies.

Casella operates a huge “zero-sort” facility in Charleston, Mass., that takes recycling material from Concord and elsewhere. It is a technical marvel using a variety of technologies to separate material, although it still requires teams of people to help hand sort. Glass, for example, is shattered by “disk breakers” so that pieces fall through a grid, which several types of plastic are separated via optical sensors and air jets, and aluminum cans, which can’t be picked up by magnets like tin cans, are moved via “reverse magnetic polarity.”

There is considerable debate within the industry about costs. Durfor, of the Resource Recovery Association, thinks that the cost of processing single-stream is about $75 a ton. Remember, he estimated that the current average value of all recycled material is $39 a ton, barely half his estimated cost of processing.

That difference puts financial pressure on processors like Casella – which is likely to show up in future contracts, where the base rate for picking up material will rise – to compensate for a decline in resale value of the final product.

Of course, regardless of finances, the environmental benefits of recycling remain, keeping trash out of landfills or blowing around the countryside, and reducing the amount of raw material that must be pulled from the ground to make new products. The push for recycling is unlikely to change even as the financial pressures alter.

(David Brooks can be reached at 369-3313 or or on Twitter @GraniteGeek)

David Brooks bio photo

David Brooks is a reporter and the writer of the sci/tech column Granite Geek and blog, as well as moderator of Science Cafe Concord events. After obtaining a bachelor’s degree in mathematics he became a newspaperman, working in Virginia and Tennessee before spending 28 years at the Nashua Telegraph . He joined the Monitor in 2015.

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