12/01/08 — Recycling revenue curbed by downturn

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Recycling revenue curbed by downturn

By Steve Herring
Published in News on December 1, 2008 1:46 PM

One man's junk might be another man's treasure, but in today's sour economic market the junk, at least the recyclable kind, isn't as valuable as it once was.

People continue to recycle, but the premium prices the materials once commanded have shrunk, said Simone Cato, Wayne County's recycling coordinator.

"Prices were high right up to October. Then all of a sudden, it went south," she said. "It wasn't gradual. It was an across-the-board impact on recyclable items."

Even the value of copper, a favorite target of thieves because of its value, has dropped.

"These are commodities and, like other commodities, subject to supply and demand," she said. "We are seeing prices that have tanked. We are pretty much like others (in recycling)."

Just how big a hit the county's recycling revenues take will depend on how quickly the trend reverses, she said.

But even with the decrease in prices, the county had a good year overall with selling its recycled items, County Manager Lee Smith said.

Smith said the county always budgets "extremely conservatively" regarding expected revenues, and that included recycling revenues.

"We budgeted a low amount, less than $40,000 for the year, which was a good thing," Smith said. "The market has completely dropped. We are just covering costs as of this month we estimate. The budget should be fine, though, due to our low revenue projection during the budget process.

"Even though the markets have dipped recently, overall we have had a really good year. It has just gone down in the last month, but we expect that when we average it out this year -- we still will meet expectations for recycling."

"During the last few years, the prices associated with recycling have been good, perhaps too good," Ms. Cato said. "The market tends to correct itself, but in this case it has overcorrected. The prices have plummeted."

Ms. Cato said the recycling market weathered downturns in the 1970s and 1990s and she expects it to do so again.

"We are sitting better compared to the West Coast because we have a strong domestic market," she said.

If there is a positive aspect of the downturn, it is that it has forced industries to look more at domestic markets instead of exporting so much overseas, to countries such as China.

Part of the reason for the high prices was that China was "gobbling up recyclables," she said.

Plastic, paper, cardboard aluminum and steel cans go to Wayne Opportunity Center where the materials are baled and sold.

"The volume is still OK," Ms. Cato said. "People are still bringing in items to recycle. We are not really affected by construction and demolition items from the housing market since they are not recyclable items."

In the meantime, Wayne County is continuing to encourage people to recycle.

He added that the recycling program not only brought in revenue for recycled goods, but also saved the county money by saving space in the landfill.

"Our landfill is lasting longer, and that is a huge cost savings," he said. "We've already extended the life of one of our landfill cells. Building a cell can cost several million dollars."