Happenings in the US Composting / Organics Recycling Industry. Presented by: Ron Alexander, President R. Alexander Associates, Inc.
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1 Happenings in the US Composting / Organics Recycling Industry Presented by: Ron Alexander, President R. Alexander Associates, Inc. October 17, 2016
2 Topics Key factors in compost sales and marketing Current trends in the marketplace Emerging markets Trends improving sales / marketing (Some data will be in Tues paper)
3 Key Elements in a Marketing Plan (and Market Development) Production/facility Product research Market research Promotion Education Sales/distribution Do you have a plan to go by? Need some fore thought! Stay engaged in the marketplace
4 Marketing Program Components Sales Focus Customer size, geographic area of concentration Pricing Policies (base price, discounts) Scheduling of Sales/Marketing Efforts Seasonal concentration of sales efforts Timing of advertising/promotional activities Sales Tools Pitch pages, sales programs, product literature Lead Generation Associated Services Procedures for Contact Management (ranking, follow up) Sales Goals More sophisticated plan Spend more time planning (plan the work, work the plan)
5 Trends / Issues Affecting Compost Marketing 1. Soil Management and Health 2. Environmental Applications and Infrastructure 3. Climate Change and Water Conservation 4. Specifications 5. Registration 6. Certification 7. Food Waste and Contamination 8. Compost Specifications and Contamination 9. Compostable Packaging 10. Creative Packaging and Blends BioCycle article
6 Popular Applications Landscaping Soil Blending > more crop / application specific Resale Agriculture Still popular and expanding major markets
7 1. Soil Management and Health Educate about importance. key to market expansion (and mitigation of environmental problems)
8 International Year of Soils 2015 On 24 April 2013 at the 146 FAO Council, FAO member Countries endorsed the request from the Kingdom of Thailand in the framework of the GSP for the proclamation of the International Year of Soils The IYS will serve as a platform for raising awareness on the importance of sustainable soil management as the basis for food systems, fuel and fibre production, essential ecosystem functions and better adaptation to climate change for present and future generations. The strategy for its implementation will be soon discussed during the GSP Plenary Assembly.
9 WHY?... Food and Ag Sustainability
10 <<< -Protection of Bay water quality, species extinction, storm water mgt. -First program Soil for Salmon - fully implemented ordinance) -Sate DOA s don t like the term (by
11 2. Environmental Applications and Infrastructure Very popular, growing Often creates higher value mixes Assisted by regional specifications requiring green infrastructural methods Composters often assist in promotion (got educated first)
12 Expanding Opportunities in Landscaping for Compost Green Building
13 Green Infrastructure - Gaining popularity today, expect significant growth (green over grey infrastructure) - Compost key ingredient to media and engineered soils
14 Rain gardens, bioswale and bioretention ponds Source: SOCCA, Filtrexx E&A
15 Compost Blankets 1-2 depth, onto 2:1 slopes Source: TxDOT and TCEQ
16 Compost Socks and Berms
17 USCC DOT Initiative CURRENT State Agencies Requiring ONLY STA Compost AK DOT CalTrans CO DOT FL DEP NC DOT NYS DOT OR DOT SC DOT TX DOT WI DNR WI DOT WS DOT PennDOT & IADOT (EC uses only) Need clean, coarse compost
18 3. Climate Change and Water Conservation Healthy soil can help mitigate effects of climate change Changing temperature and precipitation patterns More violent weather DROUGHT & FLOODS - Soil manipulation can help Billions $$ in ag losses (TX & CA)
19 Effect of Organic Matter on Available Soil Water Soil water content, m 3 /m 3 soil ATTRA each increase of 1% OM can increase soil WHC by 16,500 gallons H 2 O/A Field capacity Wilting point Soil organic matter, % by weight
20 Recent research Real world Improved lateral movement of water improved usage efficiency, especially in sandy soils
21 Compost Restores Stormwater Infiltration Capacity Source: University of Washington trials on glacial till soil. Reduce runoff by up to 50%
22 4. Compost Specification Large public & private construction projects - Must nurture and expand efforts to compensate for expanding compost production - Educate public & private specifiers (and composters too) - Landscape architects and engineers - Patience, technical background will help Projects landscape, turf, EC, storm water, reclamation, etc.
23 Feedstock Generators Need to get the municipalities generating the waste to spec and use the product (construction & maintenance)
24 San Jose & Commercial Composter Initiative Educating Bay Area Regional Specifiers Phase 4 (CSJ, Republic/Newby, Z-Best) - Landscape architects first, now engineers Tasks - Develop Compost Sales and Marketing, and Specifying Tools - Educational Events Lunch & Learns, Conferences, open events - Other Related Efforts e.g., publish articles, assist LA s modify their specs Great momentum.
25 5. Product Registration State registration of products is expanding - Register with State Department s of Agriculture as soil amendments and/or fertilizers (other?) >> Office of Texas State Chemist is the State contact - Greater voice in regulatory venue - Stay legal, raise value
26 State Regulation 48 states have fertilizer laws (not HI or AK) -Only if you make nutrient claims 38 have soil amendment laws > not Texas Individual State DOA s decide what you can and cannot state on the label *Have to register product in all states that product is distributed A composter (producer) must meet the labeling regulation in each state in which they are distributing product
27 Compost as Soil Amendment Uniform Soil Amendment Bill Net weight (volume) Brand name Guaranteed analysis ingredient type statement Purpose of product Directions for application Name and address of applicant Allowable claims and terms on labels are based on product / historical research, product type registered (and whim of State Control Official), must be in Official Publication
28
29 Compost as Fertilizer Uniform State Fertilizer Bill Net weight Brand and grade Guaranteed analysis chemical breakdown (e.g., WIN) Name and address of registrant/licensee Directions for use for fertilizer distributed to the end user Derivative statement source of nutrients
30 Guaranteed Analysis Compost registered as fertilizer New stuff affecting labeling
31 From American Association of Plant Food Control Officials (AAPFCO) Rules: Make more claims, enhance value (not all accepted in each state)
32 6. Product Certification Much more common, is expanding - Raise value, increase credibility - Open new markets (e.g., organic ag, spec projects) Quality control program for mass merchants?
33 OMRI Listing Allows for easier usage on certified organic farms However, many List products for retail sales
34 Compost: The product of a managed process through which microorganisms break down plant and animal materials into more available forms suitable for application to the soil. Compost must be produced through a process that combines plant and animal materials with an initial C:N ratio between 25:1 and 40:1. Producers using an in-vessel or static aerated pile system must maintain the composting materials at a temperature between 131ºF and 170ºF for 3 days. Producers using a windrow system must maintain the composting materials at a temperature between 131ºF and 170ºF for 15 days, during which time, the materials must be turned a minimum of five times. KEYS: Appropriate feedstocks (food issues), proper time and temps, traceability
35 WHAT IS IT? Compost testing and information disclosure program (employing standardized practices) PURPOSE To improve overall customer success in compost selection and utilization To assist compost end users purchase the product they require for their particular project Move industry towards standardized test methods and packages
36 Promoting the use of.. the appropriate product for a particular project
37 BASICS - Participating Composters will: Complete on-going product testing -Operate on-going sampling/testing regime -Using uniform sampling and analytical testing methods (from the TMECC) -Using only STA Program certified labs (list on website) Disclose test data results (lab analyses) and provide appropriate end use instructions to end users * Treat compost like any other retail, horticultural, agricultural product marketed in the U.S. 48 compost products in Texas in program
38 7. Food Waste and Contamination More states are banning food waste from the landfill (go to composting and AD) Dirty feedstock is affecting product quality!!!!
39 7. Food Waste and Contamination GARBAGE IN, GARBAGE OUT!! Higher value markets will not accept dirty compost (neither will most lower value ones)
40 More and better collection / generator education needed Better post collection separation equipment and post composting / AD separation screening / refinement
41 8. Compost Specifications and Contamination State DOT s are already reacting (CA, OR, WA) - Received dirty compost on project sites Physical contaminants TMECC C Man-made inert removal and classification: Plastic, glass, and metal % > 4 mm fraction combined total: < 0.5% Physical contaminants TMECC C Man-made inert removal and classification: Sharps (sewing needles, straight pins and hypodermic needles) % > 4mm fraction none detected
42
43 9. Compostable Packaging More compostable products are available and being used today Plastic bag bans (e.g., CA, single use), charging for grocery store bags Compostable bags assisting food waste collection - But some composters won t accept them - Why? Don t degrade fast enough Can t be in OMRI Listed products
44
45 10. Creative Packaging and Blends More creative packaging and blends are expanding sales Additives beneficial microbes, humic acid, biochar Small and large bags
46
47 Getting more crop and use specific
48 Marajuana, cheech & chong Harold and kumar Creating excitement and causing high value product development (nursery blends)
49 Conclusions Quality products, proper market planning and appropriate effort will lead to sales / marketing success Think before acting Invest in sales and marketing, staffing, and staff training STAY ENGAGED to keep up with trends
50 Available through Biocycle. QUESTIONS?
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