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CHARLESTON, W.Va. 12 7 2008 Norm Steenstra's
budgeting worries mount with each new load of cardboard, aluminum cans
and plastics jugs dumped at West Virginia's largest county recycling
center.
Faced with a dramatic slump in the recycling market, the director of the
Kanawha County Solid Waste Authority has cut 20 of his 24 employees'
work week to four days from five, shuttered six of the authority's
drop-off stations and is urging residents to hoard their recyclables
after informing municipalities with curbside recycling programs that the
center will accept only paper until further notice.
"The market is just not there anymore," Steenstra said.
Just months after riding an incredible high, the recycling market has
tanked almost in lockstep with the global economic meltdown. As consumer
demand for autos, appliances and new homes dropped, so did the steel and
pulp mills' demand for scrap, paper and other recyclables.
Cardboard that sold for about $135 a ton in September is now going for
$35 a ton. Plastic bottles have fallen from 25 cents to 2 cents a pound.
Aluminum cans dropped nearly half to about 40 cents a pound, and scrap
metal tumbled from $525 a gross ton to about $100.
It's getting more difficult to find buyers in some markets, Streenstra
said.
While few across the country appear to be taking such drastic measures
as Streenstra, the recycling market has gotten so bad that haulers in
Oregon and Nevada who were once paid for recyclables are now getting
nothing or in some cases are having to pay to unload their wares.
In Washington state, what was once a multimillion-dollar revenue source
for the city of Seattle may become a liability next year as the city may
have to start paying companies to take their materials.
Some in the business are describing the downturn as the worst and
fastest ever.
"It's never gone from so good to so bad so fast," said Marty Davis,
president of Midland Davis Corp. in Pekin, Ill., who has been in the
recycling business since 1975.
The turnaround caught everyone off guard, said Steven Kowalsky,
president of Empire Recycling in Utica, N.Y.
"Nobody saw it coming. Absolutely nobody," Kowalsky said. "Even the
biggest players didn't see it coming."
At the height of the market just months ago, customers lined the street
outside Kowalsky's business, hoping to hawk scrap to pay rising food and
fuel costs.
"That's not happening anymore," he said.
The Kanawha County authority, which sells donated recyclables from
residents and municipalities, sells about 7,500 tons of paper, plastic
and aluminum a year, Steenstra said.
Ted Armbrecht III, managing partner of The Wine Shop at Capital Market
in Charleston, says it won't be a problem piling up his recyclables at
home, but he doesn't have that luxury with his wine business, which uses
a lot of cardboard boxes.
"We'll hold onto it as long as we can, but once it reaches a tipping
point, the only other place it's going to go is the dumpster," he said.
Trey Granger, spokesman for Earth911, a national environmental resource
group, said the public's interest in recycling should be able to weather
the downturn in an industry that has been growing for more than 30 years
and has always been cyclical.
"Obviously times are tough," Granger said. "I wouldn't worry more about
this more than any other aspect of the economic downturn we're facing."
Last year, Americans generated about 254 million tons of trash,
according to the U.S. Environmental Protection Agency. They recycled
about 150 million tons of material — roughly 80 million of that in iron
and steel — supporting an industry that employs about 85,000 with $70
billion in sales, said Bob Garino, director of commodities at the
Institute of Scrap Recycling Industries Inc., a Washington, D.C.-based
trade association that represents more than 1,600 companies worldwide.
Most recyclables are shipped to Asian countries that use the material to
make products that are shipped backed to the United States to be sold.
But the market shift is now jeopardizing hundreds of millions of dollars
worth of long-term contracts for scrap metal as some companies that
signed when prices were high are trying to cancel or postpone deliveries
to take advantage of the cheaper spot market, Garino said.
Davis, of Midland Davis Corp. in Illinois, said he hopes to wait out the
market and may rent warehouse space to store his more perishable
recyclables, like paper, until he can find buyers. He has some room to
stockpile cans and plastics because in July, when prices were high, he
unloaded more material than during any month in the past 10 years.
"It's going to be bleak for a while," he said. "We can just make our
piles taller, and hopefully by spring, things will be a little better."
Whether that will come as early as spring is debatable.
"I don't know if we are at the bottom yet, bouncing along the bottom or
we have new lows to achieve," Garino said. demand for scrap, paper and
other recyclables
The market's not likely to bounce back until the economy improves.
Kowalsky estimates it could be several years.
"It's just time to pull in your horns and maintain what you have and try
to survive until 2010," he said.
demand for scrap, paper and other recyclables |