The recycling game can be a roller coaster ride for those whose job it is to sell materials to keep their operations in the black. At the drop of a hat, an opportunity can pass you by or a market can crash.

By Jack Beardwood

In the recycling business, one scrap of information can be worth thousands of dollars. "I could very easily make a deal with somebody on a thousand tons of newspaper for the month of May, and the first week of May the price jumps $5 or $10, and I'm locked into the lower price," relates Ed Duke, general manager of Fairfax Recycling in Burke, VA. "You made the deal for a price you thought was good, and a week later it looks like nothing. You try to investigate and look at trends and hope you make the right decision. I'll tell you one thing: You never get bored."

Marketing traditional recyclables (paper products, glass, plastics, aluminum and metal cans) and developing new innovative markets (e.g., converting drywall into kitty litter, coal into electricity, and cooking oil into biodiesel fuel) require a full quiver of skills.

During recent hard times, some recyclers have been "rescued" by foreign markets, reports Duke. "We've been struggling since September 11, 2001. It's been tough. Domestic mills have been down. Their inventories have been high in most all cases. It was just hard to move material. Then all of a sudden China started buying."

Duke remarks that the Chinese are savvy. "They're really tough to do business with. They know what they're doing. They're really smart. They're tough negotiators. They keep close tabs on the markets here. They know when the price is down, and they can come in and buy large quantities at a very good price."

China is currently buying newspapers, cardboard, and plastic. Spain has been buying fibers, while South Korea has been in the market for newspaper and cardboard. Duke anticipates that India will buy cardboard in the near future. "They [India] will be opening up a big cardboard mill in the next three to five months. We'll have to see if they will compete with the Chinese, if the Chinese are still around then. Sometimes [the Chinese will] jump in and buy large quantities of materials and then—bam!—they're gone again."

Understanding the Marketplace and Filling the Void

Incorporating more recycled materials into products is a goal of LinkUp. Here, plastic lumber is extruder for outdoor applications.

Waste Management, the nation's largest refuse firm, has secured new market horizons by developing a highly refined system that optically sorts commingled plastic bottles by resin and color and grinds it into half-inch flake. This massive contraption currently sits in a 50,000-ft.2 building in Youngsville, NC. The machine made it possible for Waste Management to sign a lucrative supply agreement with Southeastern Container, Coca-Cola's bottle-making group.

How did Waste Management pull it off? Quality of produce and high volume. "We anticipated a change in the marketplace," says Steve Edelson, director of plastic materials marketing. "The packaging industry kept talking about making changes in bottles. They kept talking that PET [plastic] was very attractive. We saw more products other than soda being PET. As I saw all of this I said, ‘My God, we're not going to be able to handle sort all of this in a MRF [material recovery facility]. I mean, you'll have to bring in some new technology. Otherwise you're going to handsort what you can and you're going to miss a lot, so now we can go to a facility and say, ‘Don't sort any of it, just keep the trashy items out of it and we'll take it to a more sophisticated facility.'"

The company now produces a product that has fewer contaminants and meets Food and Drug Administration standards. "We more readily fill the engineering resin applications, we more readily can fill a sheet application and a bottle application. Those environments are traditionally not available to a MRF that only produces a bale."

"It's the old Marketing 101," says Edelson. "It's understanding the marketplace, understanding what the needs are, filling the void." He adds that Waste Management is in the market for plastics, especially if it's a mixed plastic bale. "We have an almost-insatiable appetite."

In September the company expects to have relocated its plant to Raleigh, NC, where it will have a 100 million–lb. in-feed capacity. Edelson also hopes to build a plant in Chicago, IL, that will add a capacity of 75 million to 80 million.

Among the keys to marketing success is cultivation of a good relationship with the mill operators, observes Victor Horton, executive director of the Maine Resource Recovery Association, a trade association and marketing cooperative for 50 municipal-based recycling centers. "I don't always try to pit this mill against that mill to get a few dollars out of them. You may get a dollar or two this time, but they are going to remember that. If you pinch them for extra money when the times are tough, they'll turn their back on you. It's not like you're able to get a better price from them, as much as you get a steady movement of your material. If you always give Mill A four or five loads a week, it seems like when times get tough the same mill will treat your pretty decently.

"If they help you out when the times are tough, you're going to remember that. The ones that helped us out when we were desperate to move items, we are going to remember them first."

Horton suggests that brokers keep their options open. "I try to have more than one broker or mill on everything, because sometimes one guy is not going to be able to move it. Their mill is going to go down for a while and you're going to need the other guy, maybe even two or three others."

Edelson has similar views with regard to keeping in good standing with the markets. "We market in a very professional manner—not try to get the last quarter of a cent for every load, but try to deal with the long haul. We try to minimize risk. We try to sell to markets that pay their bills. A lot of times when you spot-sell you get drawn in by the price and you take some risks credit-wise that probably are unwise. When you net out your bad debt from your good sales, you'd better be careful because it may not have been as attractive as you once thought."

Eric Lombardi, executive director of Eco-Cycle in Boulder, CO, solidly believes in long-term arrangements. "I'm a believer and a practitioner of trying to negotiate long-term contracts between buyer and seller because we need each other. In the commodities world, the spot market is an exciting place to be. That's where you hear of people making big deals, taking advantage of certain market conditions, making a killing. I would recommend that anyone who wants to survive long term does not focus on playing the spot market. [That way] you're not going to be taking advantage of each other. You're going to come up with something where both parties gain."

One of the pioneers in the recycling business, Eco-Cycle negotiated one of the first long-term (20-year), multimaterial contracts for paper and cans with Weyerhaeuser. "Essentially, what Eco-Cycle traded was supply for stability. They're the buyer, they needed supply. I'm the seller, I need stability," says Lombardi.

Market development for many jurisdictions is a multifaceted effort to create new material demands that not only remove the item from the landfill but also create a need that can be profitable at a later date. It's all brought about by the marriage of governmental, nonprofit environmental groups and private-business resources.

Opportunities With Less-Than-Desirable Recyclables

John Ackerman of YK Products, makers of a dry pothole patch, saw business triple after joining the LinkUp program.

For most recyclers, dealing with glass is a problem. Most markets are down. Processing costs are high. Many jurisdictions are thinking about eliminating it from their curbside pickups or even putting it in the local landfill. With its LinkUp program, King County, WA, has created markets for glass.

King County initiated a partnership with TriVitro Corporation, which takes mixed glass and pulverizes it into various grades of grit that are old as industrial abrasives for sand-type blasting. It is also used in swimming-pool filtration systems. Some of the colored glass is tumbled and sold for crafts and mosaic work.

Another company, Allied Floors, has created a new product called Spectocular Floors, which mixes recycled glass in a custom-colored cement base to produce one-of-a-kind floor designs. The surface is ground for a terrazzo-floor look without the expensive price tag.

LinkUp is also working Bedrock Industries, a company that fuses glass into decorative tiles.

"We have pretty much hit the bull's-eye with glass," says Erv Sandlin, program manager. "We sought out companies that we knew were attempting to recycle glass and then asked them, ‘What kind of help can we provide for you in order for you to use a lot more?'"

LinkUp had to walk the extra mile to give TriVitro the help it needed. "They were having difficulty getting acceptance of their industrial abrasives, particularly their blasting abrasive, by the construction industry, particularly having it specified on government jobs," says Sandlin. "We put together a half-day seminar and workshop and demonstration on the use of this material and invited people from the construction industries, including government people, as well as contractors and engineers. We brought in outside consultants who gave them instructional material on the use of glass as a blasting abrasive and then actually took them out into the parking lot and had a painting contractor use the blasting material on several problematic surfaces to show how effective it was."

Another problem for many jurisdictions is getting rid of plastics. LinkUp partnered with Recycled Plastics Marketing Inc. (RPM), which produces plastic lumber. This new industry received a boost when the Environmental Protection Agency announced that the building industry must stop producing arsenic-treated wood by the end of 2003. The action affects all wood treated with chromated copper arsenate. It opens the doors to production of plastic decks, picnic tables, fencing, patios, and raised garden beds. RPM also makes an easily assembled compost bin from 100% postconsumer recycled plastic.

"What we're doing is helping manufacturers strengthen the markets that they collect in their collection programs," says Sandlin. "It helps improve prices so the economics of recycling is better. Most recycled materials collected by cities and counties don't pay for themselves. If we can increase their value in the marketplace, then it becomes less costly for ratepayers to have those materials recycled."

Sandlin says they discovered that several local companies have developed technologies for using recycled materials but never figured out how to market them. "We provide them with marketing assistance. That might be anything from branding their products, to developing market plans, to doing market research, helping them produce promotional materials—whatever is called for. If he needs tech evaluation, if he needs help in accessing reliable supplies of recyclable materials, if he needs product testing, or if he needs help developing a business plan in order to obtain financing, that's what we try to offer."

Another marketing opportunity in the Pacific Northwest is a new plant being built by Boise Cascade that will use wood chips and recycled film plastic to made a new board-siding product.

"Their wood-chip requirements are very strict, so it's going to be difficult for some processors of wood to meet those criteria," says Sandlin, who hopes they can find a construction demolition processor who can achieve the level of processing that will meet the market need.

Cost-Effective Island Operations

An operator demonstrates the advantage of using finely crushed recycled glass as a blasting abrasive.

In the County of Maui, HI, authorities are dealing with refuse problems of prohibitive shipping costs off-island and a limited area for establishing landfills.

To deal with pesky prospect of piling up glass, they awarded Aloha Glass Company a grant to search the world for the best system to pulverize the glass so they could use it on the island. "We never went into the collection of three colors," says Hana Steel, recycling coordinator. "I didn't think it was prudent to ship a beer bottle from Lahaina to California down into Mexico just so it can become a glass container again."

They simplified the process by mixing all three glasses from the start. "We use it as sand-blasting grit, we use it in landscape decorating. It's added at 10% to the base chords of roads. We use it in parking lots and we use it at our recycling drop-off sites, which we pave."

She says the County of Maui simply lets Aloha Glass reap the profits. "We don't want to go into the business of recycling. It's much more cost-effective in the long run to have the business sector deal with the business sector about the business sector's trash. If we assist a small business and are able to set them up to take a portion of the wastestream, then we can step back entirely."

One of the problems they targeted was reducing yard trimmings in the landfill. At the time, the state was importing a quarter of a million bags of co-compost from California. "We really didn't see the reason to continue to buy L.A. sludge, L.A. biosolids. We thought we could do a really good job of making our own."

In a contract with Maui Echo, biosolids and yard trimmings are composted, utilizing a scientific process of killing microorganisms. They now use these materials for creation of a soil amendment for gardens.

"It really makes sense," says Steel. "I mean, we're living on lava. We were previously throwing all of our yard trimmings into the dump. So 30% [formerly] of the wastestream in the history of Maui has gone into holes in the ground. It was taking a look at what is and partnering with local businesses to take over and handle a portion of the wastestream for us."

In an arrangement with Maui Earth Composting, drywall is ground and used as soil amendment.

Under the gun to get commercial liquids out of the landfill, Maui gave landfill space to a small company called Pacific Bio Diesel. The firm developed the world's first small biodiesel production plant, which takes cooking oil and manufactures biodiesel fuel. "We're not large enough to use the waste cooking oil for dog food or cosmetics," says Steel. "We use it on our tour boats, like Pacific Whale Foundation, instead of diesel fuel. It's much more tourist-friendly, but it kind of smells a little bit like French fries."

What is the key to their success? "It's basically partnering up with entrepreneurs with great ideas," says Steel. "That's the basis of our market development. We have to figure out something. We rely on the knowledge and the expertise of the people in our community believing we have everything here we need to solve our problems. We just have to work together to figure out how to do it."

A company called Uni-tech recycles tires and produces tire-derived fuel, which is mixed with coal to create electricity. Steel says they hope to move into the use of baled tires in retaining walls next year.

According to Steel, the County of Maui has managed to cut its landfill use by 32% in the last 11 years. It has done it all without a curbside recycling program; residents drop off their recyclables. "The island population likes to do this stuff. It makes sense. I think it comes because we are on an island and it takes so much to get something here that it's just a waste to have anything useable at all go to the landfill."

Award-Winning Recycling Development

Recovery One in Tacoma is one of the few facilities that handles, separates, and recovers mixed debris loads.

The Chelsea Center for Recycling and Economic Development won the National Recycling Coalition's Outstanding Market Development Award, recognizing the center as a model for organizations through the US. "We work with manufacturers who use or want to use recovered materials to make new products," explains Amy Perlmutter, executive director.

"We provide them with grants and a range of technical and business assistance. We work with communities and municipalities and provide them with grants and assistance on how to start community-based businesses that use local wastes to make some sort of product that will fit a local economic development need. We work with other organizations that provide business assistance to companies and educate them about the recycling industry because a lot of what we hear from the businesses we work with is that it's hard to get financing and support from other agencies because they don't understand recycling. And we also sponsor research into overcoming technical barriers to using more recovered materials to make new products."

Among the newer markets Chelsea is exploring is taking what's known as shoddy from textiles. "It's sort of like running a comb over fabric and shredding it almost, taking it down to the fiber. It can be used as stuffing, a thick-felt type of thing," describes Perlmutter. "It is also used for sound-proofing."

The center is funding research to investigate new ways to mold scrap tires, utilizing high-pressure centering of rubber. It is hoped the center can develop new markets for recycled tire rubber, including roofing shingles and prefabricated roadbed.

Another research project is making aggregate material out of mixed plastic and fly ash. It would be mixed with concrete to make lightweight concrete blocks. "What we've found is it actually reduces some of the cracking of the concrete," says Perlmutter. "It actually helps strengthen it."

The Chelsea Center is also looking for ways to use fish wastes to produce fertilizers and protein supplements.

Betsy Dorn, manager of the North Carolina office of consultant R.W. Beck, says one area seeing growth is jointed lumber products, where scrap lumber of different lengths is used to create furniture. She says she was amazed to be able to buy a complete dinette set at K-Mart for just $200. "Some of the pieces might be 4 to 6 inches long, but it's all jointed and glued to make solid wood products. What used to be scrap is now being made into other finished products."

One North Carolina company is using drywall to make kitty litter and other absorbents that would have a variety of functions, including sopping oil spills. "Kitty litter requires the meeting of higher specs because they have to make it pet-safe," points out Dorn.

Also growing is the recovery of scrap wood from job sites for shredding into high-quality feedstock to make multidensity firewood.

Paul Alcantar, recycling manager for Prince William County, VA, has these suggestions for those entering the market development field: "You have to look around. You have to go through the Internet to see what's going on in technology. You have to talk with manufacturers, be involved with your local small-business development programs. Also, try to stay involved with the local Rotary International club and business organizations. They can usually tell you if something new is coming in that may be a possibility for you to work with to develop a market for a material that you have."

Laurie Batchelder Adams, senior project manager for HDR Engineering in Denver, CO, has these thoughts: "I would get yourself associated with some of the organizations at the state level and the national level and take advantage of the listservs out there. You can't be out there enough and you can't be communicating enough and making yourself aware of what's going on a constant basis, because the market is very dynamic and there are often opportunities that are not going to present themselves to you. You've got to go out and find them. Find out who your contacts are, what our best sources of information are and work them consistently and constantly."

Emphasizes Lombardi, "You could have a great idea to recover some item, but if you don't get participation and tonnage, then you're never going to make it on a market basis. I think you need to expand your traditional network and include the local government movers and shakers and include your local mission-driven nonprofits to partner with you, and then those people can help you prime the pump through possible public dollars, through public support, through community support. There are all kinds of ways you can get supported by a private business to take the risk and go forward. It's tough. It's tricky. The hardest thing of all is to get new materials out."

Whether you're feeling like a champ or a chump, by pooling the talent resources in your community new markets can be created that will increase the value of recyclables, create jobs, and reduce reliance upon the landfill.

Jack Beardwood has more than 20 years of experience working for newspapers and magazines.

MSW - July/August 2002