State of the Recycling Industry. A MRF Perspective. October 16, rd Annual RAM/SWANA Conference & Show

Transcription

1 State of the Recycling Industry A MRF Perspective October 16, rd Annual RAM/SWANA Conference & Show

2 Green Fence Launched in 2013; First major initiative to crack down on contamination in the recycling being sent to China Reject shipments at ports if they are too contaminated American recyclers had to pay demurrage charges for storage of materials while awaiting inspection Raised the bar for the recycling industry and improved quality of materials coming from MRF s

3 National Sword February 2017 National Sword announced Early Crackdown on facilities in China July 2017 Notify WTO of intent to ban MP and plastics November 2017 Fiber standard to 0.5% from 2% January 2018 Bans on mixed paper and plastics begin March Enforcement of new 0.5% standard March 2018 Blue Sky 2018 announced April 2018 Additional materials to be banned in 2018/2019 May Day shutdown of ALL paper/plastic from US

4 Blue Sky 2018 March December 2018; Preventing import of recovered materials named in the country s recyclables ban which took effect January 1, 2018 as well as cracking down on falsified import documents; Further development of Green Fence and National Sword initiatives; Enforcement: Visual and X-ray inspections

5 May 2018 China suspends all U.S. scrap imports for one month (May 2018) Vietnam temporarily stops accepting scrap plastic imports Impacts currently being felt: Material movement - stockpiling on east and west coast; Midwest materials was still moving to domestic markets Depressed pricing due to excess supply

6 June 2018 Poland will close doors to recycling Interior minister stated that it was obviously related to China s decision to close its market which was followed by a record increase in illegal imports to Poland Thailand considering restriction for plastic recycling Experiencing significantly higher amounts of material when China shut its doors China Effective January 2019 China will limit ports that accept solid waste imports China to eliminate all recycling imports by 2020 Commodity prices continue to decline National average commodity value of blended ton at a MRF is now at $40/ton Lower than the cost of processing net negative value when delivered to a MRF

7 July 2018 Round 1 of tariffs went into effect on June 6th 25% tariffs on $34 billion worth of 818 Chinese products; China retaliated w/ tariff on 545 American agricultural products Round 2 of tariffs was proposed Additional $16 billion that may go into effect in August Anticipated to include aluminum, steel, and plastic Will increase demand for domestic plastic, aluminum and steel Domestic Fiber Capacity Coming Nine Dragons Paper bought two paper mills in the U.S. for $175M; GP to invest in Toledo, OR facility to recover food soiled packaging Green Bay Packaging announced new facility in Green Bay, WI 685,000 tpy w/ 100% OCC and MP

8 August 2018 Tariffs 8/23/18 China places 25% tariff on $60B worth of U.S. goods; Global Markets Malaysia import restrictions on plastic (50,000 tpm to 120,000 tpm); Thailand banning imports of e-waste and plastic waste; Taiwan limiting imports 433M lbs to 171M lbs (Q1&Q ); Vietnam import restriction on fiber, domestic supply is limited. Continued Domestic Capacity Growth; $300M to upgrade to Cascades White Birch newsprint mill to convert OCC and MP to paperboard. 400,000 tpy facility to be operational in three years; China investing in U.S. companies to prepare and pelletize plastics for export to China; US Plastics Recovery in Lawrenceville, GA increasing capacity by 50M pounds annually; Shanying International acquiring Kentucky pulp. A $150M upgrade to make pulp and brown paper packaging; Minimum content standards increasing for plastics and fiber

9 September 2018 Plastics Tariffs U.S. 10% tariff on $200 billion of Chinese goods (9/24/18) - potential to increase to 25% in January 2019 Global Markets Global plastic imports down significantly; Logistic costs are up. Higher fuel, driver shortages, ELD mandate. Vietnam & Malaysia tighten import restrictions on plastics Domestic Capacity Green Tech Solution plans for $75M recycling plant in Blacksburg, SC to process PET, HDPE, & PP. Online Q QRS Plastics Recovery Facility (PRF) in Dundalk, MD will close after less than two years of operation from

10 September 2018 Fiber Global Markets Fiber exports declined to three highest volume Asian countries: Indonesia, India, and China Fiber exports increased to smaller Asian countries: Vietnam, Thailand, and Taiwan Domestic Capacity Verso Corp. invested $19M into Jay, Maine mill to produce 200,000 tpy of kraft linerboard from virgin wood pulp ND Paper LLC, a subsidiary of Nine Dragons, purchased recycle paper mill in Fairmont, WV 240,000 tpy of air-dried recycled pulp

11 October 2018 Global Markets Plastic recyclables restrictions are in place in China, Malaysia, Thailand, Vietnam, Taiwan and now, India Domestic Capacity West Michigan Compounding, investing $6M to compound and recycle more than 100M #/year of plastic Closed Loop Fund invests $1.5M into rplanet Earth s in Vernon, CA Manufacture packaging w/ high amounts of post-consumer recycled PET. 90M #/in Q up to 180M #/year in 2020 Mondelez commits to make all of its packaging recyclables by Mondelez brands include Oreo, Philadelphia, Tang, Nabisco and Cadbury, among others.

12 Commodity Pricing? Depressed due to excess domestic supply less to China August 2018 (-$5/ton) August 2017 $70/ton MP standard was 2%, now 0.5%; Cleaner product sells for a fraction of a price if anything at all! Adjust recycling model to accommodate market volatility must be borne by the generator/consumer. RECYCLING COSTS MONEY - more than disposal!

13 China Impacts

14 Chinese Investment in U.S. Recycling Nine Dragons: Fairmont W. VA. Subsidiary of Shanying International: Wickliffe, Ky. Green Tech Solution: Blacksburg, S.C. Roy Tech Environ: Grant, Ala. Ecomelida: Orangeburg, S.C. UPT Group, Montezuma, Ga Startup SOURCE: Resource Recycling September 25, 2018

15 Automation Reduce reliance on manual labor - #1 challenge for MRFs Improved processing efficiency uptime, processing hours, etc. Repurpose manual sortation jobs to oversight and maintenance of system

16 Optical Sorters Continued advances in technology sensors, computing speed, algorithms Utilizes near-infrared, color, and metal detection for sortation Can sort up to 12 tons/hr of product

17 Emerging technology Mechanical & material recognition advancments Goal: Provide work of one FTE Continue to play a role in the MRF of the future Robotics

18 Artificial Intelligence (AI) Real-time metrics enabled by AI; Material mass, material count, product identification, conveyor utilization, processing metrics to improve efficiency; Obtain metrics on facility residue, inbound quality, outbound quality, processing efficiency, etc.

19 So How Do We Survive? Quality improved quality through continual investment into education, new technology, & infrastructure; Automation robotics, optics, & artificial intelligence (AI); Contracting - durable and sustainable business model/contracts; Adaptation industry must adapt to the new normal of producing higher quality materials at a lower cost.

20 The Solution Simplify Recycling Focus on Education Standardize Packaging Increase Recycled Content

21 QUESTIONS? Bill Keegan, P.E. President