The Biggest Market Crash Is Recyclables
Money For the Rest of Us
J. David Stein
4.5 • 1.4K Ratings
🗓️ 6 June 2018
⏱️ 29 minutes
🔗️ Recording | iTunes | RSS
🧾️ Download transcript
Summary
#208 How a Chinese ban and careless recycling habits by households and businesses led to a market collapse in recyclables. More information, including show notes, can be found here.
Episode Summary
The biggest market crash facing the United States today isn’t entirely economic in nature. It’s actually surrounding the idea of recycling and recyclable goods. Recycling is a service that most communities require and demand. But is it economical? Why has the market crashed in recent months? What are the solutions? This episode of Money For the Rest of Us will answer all that and more, so be sure to listen.
What are the current values of recyclables, given the market crash?
Most types of recyclable products have fallen steeply in price. Mixed paper prices have fallen 98% in the past year. Corrugated cardboard has fallen 48% and plastics ranked 1 to 7 have fallen 78%. Co-mingled plastics, aluminum, and steel have been holding steady or even increasing, however, the vast majority of recyclables aren’t bringing in the high returns they used to. In areas such as the Pacific Northwest, you even have to pay a company to take it off your hands. What changed? Be sure to listen to this episode to find out.
What has caused this massive market crash?
The biggest influencer in the recyclables market crash was China’s decision in January 2018 to ban imports of 24 different types of recyclable materials. Americans recycle 66 million tons of material each year, and much of this material used to be sent overseas to be sorted, cleaned, and processed. However recyclable exports to China fell 35% in the first 2 months after the ban, and future rates aren’t looking favorable. Now, all of this recyclable material has nowhere to go. To get the full story behind the China ban and how it impacts the US recycling industry, be sure to catch the full audio for this episode.
The 5 main ways we can improve our recycling habits
To solve the market crash issue, Americans need to rethink their recycling habits. The problem with “aspirational recycling,” or thinking everything can be recycled just because we want it to, is a contributing factor to this complex issue. 5 ways to combat the recyclable market crash and current mindset about recycling are featured on this episode of Money For the Rest of Us. Here they are:
Understand that recycling isn’t going away
Consider recycling rate stabilization funds
Consider banning certain materials at specific plants to reduce contamination and mixed goods
Revamp educational programs about recycling
Develop recycling markets right here in the US
What’s the real solution to the recycling market crash issue?
Even with all the great strategies discussed on this episode, simply recycling in better ways isn’t enough to solve the true issue. Everyone has to start considering the life cycles of the products we use every day. Changing the way countries around the world handle waste and preventing it from entering our waterways and contaminating our land is the real solution – basic recycling is just a temporary fix to a much larger issue.
Episode Chronology
[0:42] Why the recycling business is currently crashing and collapsing
[4:28] The current value of recyclables, given the market crash
[8:09] What has caused this crash in recycled goods?
[9:32] The problem with “aspirational recycling”
[14:38] Why we have to do better at recycling
[22:05] The true heart at the of the recyclables market crash issue
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Transcript
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| 0:00.0 | Welcome to Money for the rest of us. This is a personal finance show. It's on money, how it works, how to invest it, and how to live without worrying about it. |
| 0:09.0 | I'm your host, David Stein. Today is episode 2008. It's titled The Recycling Market Crash. Business is hard, but can you |
| 0:19.8 | imagine operating a business where prices fell over 98% in one year. |
| 0:30.0 | Well, welcome to the recycling business where there is a crash, a complete collapse on many of the recycled goods or inputs, particularly paper and plastic. |
| 0:50.0 | I got my first taste of recycling when I was five or six. My neighbor |
| 0:54.8 | across the street decided to have a paper drive and I don't remember much |
| 1:00.9 | about it other than their single car garage stacked with papers and |
| 1:07.2 | piling into the station wagons, their station wagon my friends and going to the recycled newspaper plant. |
| 1:17.0 | And for my efforts in helping to collect some of those papers, my neighbor, Mr. Daly, gave me a couple bucks. Might have been less than a dollar, |
| 1:27.2 | might have been changed, but I got money for recycling. Later, when I was 9 or 10, my primary source of income before I got a paper route was collecting |
| 1:40.0 | soda bottles and beer bottles and taking them to Gill's pony keg at the local store |
| 1:46.7 | that sold beer, wine, snacks, ice balls, which we now know is snow cones, and he would give me money for these bottles that I would |
| 1:56.9 | collect from the baseball field next to our house. This past April marked the 50th anniversary of the first curbside |
| 2:07.8 | recycling program. It was in Madison, Wisconsin and it was funded from a grant by the American Paper Institute to test collecting newspapers. |
| 2:19.1 | That was in 1968, a decade later, more than 200 cities collected recyclables separately from |
| 2:25.8 | garbage mostly newspapers I remember saving newspapers you put them in a |
| 2:30.0 | paper brown paper grocery sack and you sat stuck them next to your garbage can and they got |
| 2:37.2 | recycled. The first multi-material program for recycl where it was mixed, was in Newton, Massachusetts in 1975. |
| 2:47.0 | There was an article by Chaz Miller on the Waste 360 website that says we should credit Garden State Paper for |
| 2:59.1 | launching the Modern Recycling Program. This was a company created by Richard Scudder in Garfield, New Jersey, |
| 3:07.0 | and he came up with a process or a mill to recycle old newspapers into new newsprint. |
| 3:17.0 | And that's what launched it. |
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