From China's scrap import restrictions to the coronavirus pandemic, the last few years have been turbulent for municipal recycling programs. The Resource Recycling Conference, held virtually Aug. 4-5, focused on how these programs are evolving through a period of unique challenges and opportunities.
Catch up on some of our team's key takeaways about curbside commodity trends, labor availability and metrics for success.
MRFs and resin manufacturers increasingly focused on future plastic markets
Higher resin prices and stabilizing domestic markets for postconsumer plastics have helped spur a flurry of investment in MRF technology and recycled resin manufacturing in recent years, speakers at several panels said.
Virgin resin prices have increased steadily over the last eight or nine months, enticing plastic manufacturers to seek lower-priced postconsumer resins, said Eadaoin Quinn, director of business development and procurement at EFS-plastics, which produces postconsumer plastic resin (PCR).
This trend has been especially helpful for polypropylene markets, which aren’t as established as markets for PET and HDPE because not all curbside programs collect the material. “The pricing we're seeing on polypropylene is the highest it's been,” Quinn said. This favorable pricing could be a boon for EFS, which is constantly looking for new sources of PP for its PCR products.
Quinn said this shows the resin has both value and potential for expanded market development, especially in municipalities or MRFs that haven’t collected it in the past because they didn’t see a strong market. “It’s a little confusing for me to hear places saying that it's not recyclable when it actually does have the highest value it ever has,” she said.
MRFs around the country have accelerated their equipment improvements in the past five to eight years, especially following China’s National Sword initiative when the country stopped importing most recyclables, said Maite Quinn, a managing director at Closed Loop Partners. The market disruption from National Sword prompted MRFs to focus on producing better quality commodities and boosting domestic markets.
Eureka Recycling, a Minneapolis-based nonprofit MRF, purchased a new optical sorter several years ago to better sort its PET stream, and it repurposed the old optical sorter to target PP. At the time, PP prices were not high enough to cover the cost of that new sorter, but that has since changed, said Kate Davenport, Eureka’s co-president.
“The value that we're seeing from material right now is really important in terms of being able to cover the investment that we're talking about. When you're getting eight cents a pound for polypropylene, that's not covering the cost of the $750,000 to $1 million-dollar optic,” she said.
Yet even with high commodities prices to cushion investment costs, equipment purchases can be daunting, especially knowing that prices could be temporary, said Brent Hildebrand, vice president of recycling at GFL Environmental. He urged other MRFs to seek state or local grant funding to help cover technology investments. Future funding could come from plastic resin manufacturers themselves, which are investing in initiatives to boost PP and PE plastic markets.
Eadaoin Quinn acknowledged that the sky-high plastics prices are expected to stabilize or decrease again in the next six months, and MRFs and resin manufacturers have to cope with the reality that PCR prices are still tightly tied to virgin resin prices. Recyclers are working with corporations that have made recycled content commitments to motivate them to buy recycled resins for reasons other than price difference, she said. “We would like the price of recycled plastic to be valued separately from virgin, and for it to be valued based on its environmental benefits,” she said.
MRFs are also keeping their eyes on future plastics innovations that may become business opportunities in the future, Davenport added. Flexible packaging, such as the kind used to make juice pouches and other snack packaging, represents challenges and opportunities, speakers said.
This type of packaging sometimes contaminates paper and plastic streams and has several layers of different material, making separation a challenge. Speakers said chemical recycling companies have touted such materials as an ideal feedstock for their operations, but it could be years before MRFs feel confident enough in end markets to pursue it as a serious stream.
“With flexible packaging, there are a lot of questions in terms of what are the markets and where are they going. I know we've seen some pilot projects, but we want to know what the investment would be to outfit all the MRFs across the country, not just one pilot MRF,” said Davenport.
Instead of waiting for future markets, companies must design packaging that is easier to recycle right now, said Palace Stepps, president of Sonoco Recycling. His company manufactures and recycles packaging, including flexible packaging. “We've gotten a lot more thoughtful about designing that flexible packaging to make it more easily recoverable in MRFs, and that means making it from a mono material,” he said. ”The investment’s on our side. In terms of product design, to make it easier to capture.”
Paper markets are still adjusting to COVID-19-related demand
Fiber manufacturers, reacting to major market changes spurred by the pandemic, scrambled to meet demand for packaging and tissue feedstock in 2020. Things haven’t been the same since, said Marc Forman, president of GP Recycling, a division of paper mill company Georgia-Pacific.
“Nothing prepared me for changes during the pandemic,” he said, noting spikes in demand for tissue as consumers rushed to stock their homes with toilet paper in early 2020. E-commerce habits also increased, creating huge demand for OCC to make more cardboard boxes and other packaging. Early supply chain issues from truck and ocean shipping shortages also caused bottlenecks.
Supply has also changed “completely” from the pre-pandemic world, Forman added. Mills no longer see office buildings as a source of recycled paper, a key staple for making tissue, “because no one works in offices anymore. We’re in an environment where return-to-work is uncertain.”
Processors and mills once used to getting 90% of their OCC supply from brick-and-mortar retailers or office buildings have had to get creative to capture that material as more cardboard boxes appear in residential curbside streams instead. “That rapid rise in e-commerce demand is likely here to stay,” he said.
MRFs say their fiber streams have also seen dramatic changes since early 2020, particularly with OCC. Eureka saw OCC volumes quadruple at the beginning of the pandemic.
MRF operators Hildebrand and Davenport say their organizations are motivated to create clean fiber streams in part because they have long-term contracts with nearby paper mills and know there’s a reliable buyer for the material. “We’ve definitely seen this need for capital investment because the stream is changing so much,” said Davenport.
Not all MRFs are able to produce fiber streams clean enough for some of Georgia-Pacific’s needs, but the company maintains good relationships with haulers and MRF operators that serve as an important source, Forman said. Domestic mills have signaled growing demand for fiber, which is great for the industry, he said. Technology upgrades and innovations would help match that appetite, but only if fiber commodity prices start rising.
“Innovation requires investment, but these long, extended periods of low commodity prices are not good for the industry,” Forman said. That could change soon, he hopes. “Remember that pricing is cyclical. I think we're in a period now where we'll likely start to see higher commodity prices.”
Labor is a limiting factor
Having enough people to actually run recycling programs remains a challenge, due to factors that preceded or were introduced during COVID-19.
“Labor shortages have really just been exacerbated by the pandemic, specifically the CDL drivers. This was an issue before the pandemic, but we keep hearing this in the news that we're having a hard time finding the drivers to collect the stuff, and deliver the stuff,” said Cody Marshall, chief community strategy officer at The Recycling Partnership.
When it comes to communities’ greatest challenge with change during the pandemic, “The common theme is people,” Marshall said, and managing these programs and having enough people to do it. “We need butts in seats in trucks,” which has proven even tougher given the disruptions of social distancing requirements or childcare issues.
Atlanta’s Kanika Greenlee, head of the city’s solid waste division and executive director of Keep Atlanta Beautiful, echoed those sentiments, describing labor constraints as “a huge challenge.” “The labor shortage is real in the waste industry” for both public and private sector employers, she said.
“Everyone's looking for CDL drivers from Amazon to Coca-Cola to UPS to our Atlanta Public Schools,” Greenlee said. “So we’re competing with all those entities to get CDL drivers and then we're all competing for our environmental service workers or our collectors on the back of our trucks.”
Hildebrand said MRFs are also “having to get creative” to attract and keep good employees. GFL offers bonuses for certain tasks, such as employees who work in-person at a particular site for a full week. MRF operators also see technology upgrades, such as more advanced sorters that don’t rely on human sorting, as a way to help with labor shortages.
Davenport said MRFs can both invest in technology and employees at the same time, such as by finding new ways for employees to attain a promotion. When her facility installed new robotics, for example, they created a new position for an employee to monitor and interpret robotics data.
Climate effects and other metrics are increasingly important
Recycling rates and economic benefits have long been some of the primary metrics for tracking local programs. Now, state and local officials say they’re increasingly focused on how other areas such as climate change and equity also factor into the picture.
For NextCycle Michigan, a new market development program funded via public and private partnerships, progress is being measured in many different ways. While the state does have a goal of tripling its current estimated 15% recycling rate, NextCycle and related state initiatives is about more than just shifting tons from one category into another.
“It goes way beyond 45%, it’s really about building the circular economy,” said Elisa Seltzer, senior consultant at the firm RRS. Seltzer outlined how NextCycle will eventually distribute funding across six different tracks, with grants designed to help projects of varying sizes and development stages. Rather than a typical grant program that won’t award funding if a project isn’t considered ready, said Seltzer, NextCycle can help support and incubate ideas to meet people where they are.
In addition to prioritizing proposals that bolster the supply chain of recycled feedstock for manufacturing, NextCycle is also seen as a way to address growing priorities such as climate change and equity.
“If you’re not making that connection between climate and recycling now, you should do it soon,” said Matt Flechter, recycling market development specialist with Michigan’s Department of Environment, Great Lakes and Energy, adding this can help further engage state and local lawmakers. “For so many years we’ve talked about jobs and the economy and protecting the environment, now we have another tool in our toolbox.”
For Flechter, the recent emphasis on these issues is “the main difference right now in market development” compared to prior thinking.
These considerations are also guiding decisions in Oregon’s Lane County, where local staff are working to achieve a 63% recovery rate by 2025 and preserve the lifespan of a regional landfill.
Angie Marzano, the county’s waste reduction specialist, said mitigating the local effects of climate change are a key motivator for herself and area residents. This means more partnerships with local organizations to focus on reuse, repair, food waste prevention and recovery. Broader thinking about avoided emissions and life cycle impacts will also inform decisions.
“Both an increase in collection and a focus on food waste prevention are going to be our number one priority moving forward,” said Marzano, later adding that sometimes “it’s more important for you to eat the food in the container than for you to recycle the container.”
The Recycling Partnership is seeing similar engagement with sustainability and related policies on a broad scale.
“There's definitely never been a better opportunity to improve. Local governments are working on sustainability. Private companies are really focused and understand the need to be a part of the equation. Policy has become an incredibly important part of the conversation, you're seeing that around the country,” Marshall said.
Correction: A previous version of this article had an incorrect title for Marc Forman. He is president of GP Recycling, a division of paper mill company Georgia-Pacific.
