Published On: Tue, Jul 12th, 2016

Plastic discarded in Bend may travel the world

Recycling of plastics, paper, other material is a global market

Each time you toss your empty plastic milk jug into the commingle recycling bin, you likely end up contributing to a global market.

That’s because after recyclables are collected and sorted, they’re sold as commodities, often to other countries.

Plastic Recycling

Plastic discarded in Bend may travel the world

If your provider is Bend Garbage & Recycling, your commingled recycling bin is collected at the street and taken back to headquarters in northeast Bend. There, the recycling is initially sorted, with trash pulled out, baled and transported to a sorting facility, or material recovery facility, owned by Pioneer Recycling Services in Clackamas.

“We either are paid or we pay depending on the markets,” Brad Bailey, owner of Bend Garbage & Recycling, said Thursday. “It’s fluctuated over the years. When we first started, there was no revenue; then for awhile there was.

“Markets are down to some of their lowest lows.”

As Bailey pointed out, the price of plastic doesn’t depend on the U.S. economy.

“It’s a global market,” he said.

Dave Claugus, vice president of Pioneer Recycling Services, agreed: On average the price of plastic, and other commodities, has gone down. The Recycled Plastics Composite Index, which tracks market prices for scrap and secondary plastics, has fallen 13.36 percent over the last year.

“In general over the last few years, the average value of recyclable commodities have been trading low,” he said.

Claugus said the average decrease is likely the result of two major factors. One is the slower growth of the Chinese economy.

“They just don’t need as much material as they once did when they were growing at 10 or 15 percent,” Claugus said, explaining it’s now growing at closer to 6 percent.

The other major factor in the decrease is the drop in the price of oil, he said, a key ingredient in most plastics.

Claugus said Pioneer Recycling Services ends up selling most of its recycled commodities, such as plastic and metal, to buyers in China, Canada or Oregon.

Of $947 million in export sales of plastic scrap in the U.S. in 2014, 69 percent was shipped to China and Hong Kong, according to the Institute of Scrap Recycling Industries Inc.

Claugus wouldn’t reveal how much his company pays on average to collection companies like Bend Garbage & Recycling for recyclables, but he did explain that just because the average price for commodities is down, it doesn’t mean the market is static.

“Every year, there’s this kind of perfect storm of lower prices around our Christmas and New Year holidays,” Claugus said. “You have these seasonal factors that cause prices to fluctuate.”

Around fall, Claugus explained, the supply of recyclable materials increases. Newspapers are larger with ads, he said, and companies like Amazon are shipping more as people prepare for the holiday season. At the same time, while more of these things are being recycled by people in their homes, there’s a reduction in demand: Amazon has already bought its boxes, and printers already have their newsprint rolls for the season.

The Chinese New Year comes in January or February, depending on the lunar cycle, so buyers in that country often quit purchasing during that period because there’s no one around to unload the shipments, Claugus said.

So while recycling piles up at home, there are fewer interested buyers. This past winter, Claugus said, his company charged collection companies like Bend Garbage & Recycling a small fee to drop off recycled materials, when usually it would pay.

“We do have this ebb and flow,” Claugus said.

Claugus said this month is also a good example of how fluctuation in prices of different commodities can almost cancel each other out.

Paper grades moved up in price, he said, while plastics and metals moved down.

“We’re paying some pretty good money right now,” Claugus added.

Still, compared to a few years ago when oil prices were higher and China’s economy was growing at a faster rate, prices have decreased.

“The markets are at historical lows, really,” Bailey said. “They’re not real strong.”

Bailey explained while the changing prices of recyclable commodities will affect whether his company gets paid, they’re not affecting the program for users.

“Anybody that’s providing these programs are missing that piece of revenue they used to have to help run the program,” he said.

In the future, user costs to collect recycling may go up slightly over time, but right now, the global market of recycled commodities isn’t affecting local users.

The main way users can continue to keep local costs down is by following guidelines for what can and can’t be recycled. The less rubbish tossed in with recycling, the better.

At large sorting facilities, like the one in Clackamas, machines do the work, but that’s because it serves a big part of the state. It’s not worth it for local collectors, like Bend Garbage & Recycling, to invest in the expensive equipment. Pioneer Recycling Services’ machinery costs about $15 million.

If residents or business owners toss nonrecyclable Styrofoam packing peanuts into the recycle bin on top of recyclable cereal boxes, soup cans and plastic tubs, they’re creating more work for the person who initially sorts the material in Bend.