Americans Could Soon Be Drowning in Own Garbage
NEW YORK – October 10, 2018
Despite the federal administration's victorious responses, the economic crisis in America is intensifying and deepening. Now it's reached the recycling industry, which is in the dumps today.
The three largest publicly traded residential waste-hauling and recycling companies in North America, Waste Management, Republic Services, and Waste Connections, reported steep drops in recycling revenues in their second-quarter financial results. Houston-based Waste Management reported its average price for recyclables was down 43% from the previous year.
"A year ago, a bale of mixed paper was worth about $100 per ton; today we have to pay about $15 to get rid of it," says Richard Coupland, vice president for municipal sales at Phoenix-based Republic, which handles 75 million tons of municipal solid waste and 8 million tons of recyclables nationwide annually. "Smaller recycling companies aren't able to stay in business and are shutting down."
Kirkwood, Missouri, announced plans this summer to end curbside recycling after a St. Louis-area processing facility shut down. Officials in Rock Hill, South Carolina, were surprised to learn that recyclables collected at curbside were being dumped because of a lack of markets. The lack of markets also led officials to suspend recycling programs in Gouldsboro, Maine; DeBary, Florida; Franklin, New Hampshire; and Adrian Township, Michigan. Programs have been scaled back in Flagstaff, Arizona; La Crosse, Wisconsin; and Kankakee, Illinois.
Other communities are maintaining recycling programs but taking a financial hit as regional processors have raised rates to offset losses. Richland, Washington, is now paying $122 a ton for Waste Management to take its recycling; last year, the city was paid $16 a ton for the materials. Stamford, Connecticut, received $95,000 for recyclables last year; the city's new contract requires it to pay $700,000.
This change mainly stems from a policy shift from China, long the world's leading recyclables buyer. At the beginning of the year it enacted an anti-pollution program that closed its doors to loads of waste paper, metals or plastic unless they're 99.5% pure. That's an unattainable standard at U.S. single-stream recycling processing plants designed to churn out bales of paper or plastic that are, at best, 97% free of contaminants such as foam cups and food waste.
The resulting glut of recyclables has caused prices to plummet from levels already depressed by other economic forces, including lower prices for oil — a key ingredient in plastics.
The other major part of the problem, besides lower commodity prices overall, is sloppy recycling.
In the early days of recycling, people had to wash bottles and cans, and sort paper, plastic, glass and metal into separate bins. Now there's single-stream recycling, which allows all recyclables to be tossed into one bin. While single-stream has aided efficiency, and customers like it, it's been a challenge on the contamination side.
"The death of recycling was completely avoidable and incredibly easily fixed," says Mitch Hedlund, executive director of Recycle Across America, which advocates standardized labeling on recycling bins so people understand what goes in and what doesn't.
A range of initiatives has been launched to get people to recycle right. Chicago is putting "oops" tags on curbside recycling bins with improper contents and leaving them uncollected. Rhode Island is airing "Let's Recycle Right" ads. Meanwhile, recyclable materials processors are re-negotiating contracts with municipalities to reflect the fact that prices paid for recyclables no longer offset the cost of collecting and sorting them.
"What we're advocating is to step back and re-look at recycling," Republic's Coupland said. "This is the new normal. The model no longer funds itself."
In recent years, America’s recycling industry has reached enormous proportions – there are about 550 waste processing plants in the U.S., almost 1.5 million people are involved in the collection, processing and disposal of garbage, and there are about 56 thousand enterprises, the annual turnover of which is almost $240 billion. The U.S. still maintains its leading position in this field, but the global and internal markets and the entire economic environment are changing rapidly. The old system doesn’t work anymore; we have to build a new one, otherwise, we have every chance of drowning in our own garbage over the next few years.