Recyclers see falling prices in slow economy
WORTHINGTON -- In the last few months, Jon Bloemendaal has seen the bottom fall out of the recycling market in Murray County -- and it's a problem witnessed at recycling centers all across the country as the nation continues to experience economic woes.
Bloemendaal, who manages Murray County's recycling program, said he's seen cardboard prices drop from $120 per ton in April to about $25 per ton today. Plastic pop and water bottles went from 14 cents per pound last summer to about 2 cents per pound today, and aluminum went from $1 per pound to just 30 cents per pound in the same time span.
"A lot of the people in our positions are just trying to hold onto the material hoping (the prices) will bounce back, but a lot don't have storage," he said.
While markets traditionally dip in the winter months due to temporary closures at some recycling plants that use the time to replenish their stockpile, Bloemendaal said the current dip is deeper than many have ever seen.
"My broker said this is the worst he's ever seen since he took over his business," Bloemendaal said.
Murray County works with one main broker to move recycled commodities out of the county, although tin is shipped to Marshall and glass is transported to Shakopee. Glass has never been a money maker, but Bloemendaal said collecting the product is a service to residents.
"We're providing a recycling service to our public," he said. "Recycling is important to Murray County (and) to the State of Minnesota."
According to state statute, counties outside the metro area must recycle 35 percent of the total weight of their solid waste generation. Many counties have exceeded that threshold, resulting in a new goal of 50 percent of all solid waste generated to be recycled in the coming years.
That's a cause for concern for recyclers like Bloemendaal -- primarily because of the current market situation.
"Obviously the markets will change, but right now that's an issue -- to recycle more material for less money," he said.
In Worthington, Schaap Sanitation has amassed certain commodities that have zero market value, according to manager Eric Joens. The facility actually has to pay to get some recyclables off its hands by having to truck it to places like Sioux Falls, S.D., the Twin Cities and into central Iowa.
"Normally these commodities have a value to them, and their valuations have dropped by two-thirds," Joens said. "It's probably the worst economic climate for the scrap (business) in the 18 years I've been working here."
There are varying reasons for the drop in prices paid for recyclables.
The market for plastics is driven by the price of gas, said Bloemendaal. The reason is that plastic is a byproduct of the fuel-making process.
"When gas gets cheap, it's cheaper for them to buy ... brand new plastic versus recycled plastic," he said. "We're all happy when gas prices drop, but that's where it hurts our (plastics) prices."
Another reason for the price drop is that China, a country that last summer was a major player in the purchase of recycled commodities from the U.S., is also experiencing an economic downturn.
The hope is that things will turn around in the new year and that recyclers can whether the current storm for a while longer.
"At Schaap Sanitation, we're dedicated to the environment and we're in this for the long haul," said Joens. "We've seen commodity prices fall before. It's part of the recycling stream."
Meanwhile, Bloemendaal said they need to keep the recycled commodities flowing.
"We're just happy to move the material," he said. "I've been doing this since 1993, and years ago we were happy if we got $10 per ton for our newsprint ... we were happy if we could move a load. We might end up taking what we can."