Recycling is big business, but is it profitable?

recycled plasticsThe news doesn’t appear to be good for the recycling industry. The front page of the Business & Finance section of the May 14, 2018, issue of the Wall Street Journal carried the headline, “Recycling Firms Hit by Crushing Economics,” and wrote in a sub-headline, “plunging prices for scrap paper, plastics prompt cities to send some items to landfills.” 

The WSJ article by Bob Tita quoted James Warner, CEO of the Solid Waste Management Authority in Lancaster County, PA: “Recycling as we know it isn’t working.” Lancaster County, noted the article, “may limit the recyclable items collected from [its] 500,000 residents to those that have retained some value, such as cans and corrugated cardboard. He said mixed plastic isn’t worth processing.”

That’s not the first time I’ve heard someone in the recycling industry say something to this effect. One person, whose name I’m not at liberty to disclose, told me that I’d be surprised at the amount of plastic that actually goes to the landfill because it’s unsuitable for recycling. That’s not a very politically correct thing to say and perhaps it’s the recycling industry’s “dirty little secret.”

As I learned a number of years ago, recyclers want clean recyclates when dealing with plastics. Unfortunately, much of the post-consumer plastic recyclate is dirty and filled with debris. That was one of the reasons China gave for refusing to accept bales of plastic recyclate from the U.S. 

Sorting the various types of plastics by hand alone is a huge—and costly—job, and if the money isn’t there to make the recycled plastic worth the effort, it will go to the landfill. The photo illustrating the WSJ article showed four people—two on each side of a conveyor belt—with large containers for waste by their side sorting the commingled scrap: Paper, plastics and metal. That’s the way it’s done, I would imagine, at most commingled scrap recycling facilities.

Entrepreneurs have long worked on inventing a way to make the recycling of the various plastic types economically feasible. One idea I was invited to view at the home of a Phoenix inventor back in the 1990s was certainly novel. Because plastics have varying melt temperatures depending on type, this guy had built a small prototype conveyor with multiple levels. Heating units under the conveyor belt of each level were set to different temperatures to “attract” the specific plastic that melted at that temperature. The pieces of plastic would then stick to the conveyor belt and be automatically sorted into different containers at the end of the line. I honestly could not see how this could be done on any large-scale operation. The effort that it would take to build this contraption along with the electricity to run it would make it less than a good solution. Needless to say, this idea never got off the ground.  

Sorting is costly; careful sorting and cleaning of plastics that contain food remnants, labels and other debris to get the quality of plastics needed for reprocessing into pellets is even more costly. With the price of recycled plastics declining, recycling is becoming a less profitable business. 

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