When oil prices hit the skids, recycling markets suffer. This has been in the news for the past several weeks and I have had the pleasure of discussing this issue on CBS on two separate occasions. Now we see the New York Times commenting on the same issue.
I have responded to this issue in a previous blog as to the real value of recycling. Unfortunately, the recent article in the Times tends to muddy the waters.
The article makes the changes in the market sound as though we are facing poor markets for the first time. To me, it is even more humorous to hear Waste Management, Inc. complaining about markets and the effect of single stream recycling on value.
It was Waste Management that went out and sold the illusion of single stream recycling. They swore in programs around the country that this was the future and that prices would be fine. OOPS…
Now Waste Management says that recycling is in crisis. The article should have said Waste Management is in crisis. They made poor business decisions (as have other companies) and now the world is on fire.
In reality, recycling is fine. The markets are low, prices are low, and the ability to make a profit from low grades of material; i.e., from single stream materials that contaminated, is certainly more difficult. However, where programs are well coordinated and towns and counties realize that they are service providers, recycling still works. Indeed, markets are lower, and it is not a profit center so to speak, but it still works.
Where recycling is in crisis is in the area of perceived profits. When towns and counties, as well as recycling companies think that they should be making huge profits from recycling, they are indeed in crisis.
Recycling has many values. There are economic values. There are numerous environmental benefits (See my prior blog posts).
More to the point, and in direct response to the whining of Waste Management in the New York Times article, companies are still able to make a profit. Not as much as before, but a profit nonetheless.
What can towns, counties and companies do to help recycling improve?
- Remember that markets vary over time…recycling is a commodity and will go up and down in relation to the laws of supply and demand…as well as in relation to other raw commodity markets.
- Remember that recycling has benefits that are long term in nature.
- Remember that recycling is a service that is often provided by government (especially in the northeast) and in many cases is a mandated service.
- Remember that to modify behavior we must invest in education. Take a look at the SIMS plans in Brooklyn and see what can be done.
- Remember that clean materials have the highest value and to get the cleanest materials we must continuously remember point #4.
Read more on my website about the low prices of oil impacting recycling centers:
Recycling industry impacted by falling oil prices
Watch the CBS News video segment:
Some Industries Hit Hard As Oil Prices Fall
Read the NY Times article:
Skid in Oil Prices Pulls the Recycling Industry Down With It
Limited free access; NY Times subscription may be required.