News

The drop in crude oil prices has a positive impact on many industries, from travel and tourism to manufacturing. But in the plastics recycling sector, the reverse phenomenon is occurring. As the price of virgin polymer drops and becomes more advantageous, the price of recycled plastic material is less competitive. As such, companies that have derived a revenue stream from plastics recycling services and recycling equipment are feeling the heat.

Over the years, the number of companies that offer municipalities and companies plastic material services—collection, sorting, and reselling—has grown. In the wake of the drop in oil prices, and the resulting slower demand for recycled items, many of these businesses are struggling because they can’t compete with the new plastic prices. As this Wall Street Journal article points out, the cost for new polyethylene terephthalate, simply known as PET, which is used to make water and soda bottles has fallen to .$67 per pound. Recycled PET costs $.72 per pound.

It’s clear from numbers like these that there is less demand for recycled plastics. As such, some of recycling companies have cut corners in order to survive, meaning the disposal of the plastics waste might not be fully compliant with state and federal codes. To that end, companies today must be careful of who they choose as their recycled goods partners.

Be particular with partnerships

To ensure that your recycling partner is compliant, it’s important to ask questions and look for answers that meet the right criteria. Some of the questions I recommend companies ask of potential recycling partners include:

• What are the recycler’s technical capabilities?
• What is (where is) the disposal facility?
• How often do you audit the facility?
• What insurance provisions do you have to protect from future liabilities?

Doing the legwork to identify the right partner is imperative. After all, finding your waste material in an illegal landfill not only leads to possible fines and reputation loss, but it can have a dramatic impact the environment. The proper disposal of plastic material waste is a part of corporate stewardship and environmental responsibility. It’s something we must all take seriously so we may protect our businesses today.

A reason to recycle

Expense Reduction has undertaken several successful projects where we have been able to convert an operating cost (disposal of plastic materials) into a revenue stream by finding outlets for the plastic waste material. Please contact us today to learn more about recycling plastic materials.