Market recovers for cardboard recyclers
Those cardboard boxes you broke down and put in the trash bin behind your business? There’s a good chance they’ll soon be on a cargo ship bound for China for recycling.
Demand for that cardboard is rising as Chinese manufacturers rebound from a mid-2012 slump that sent prices of used cardboard tumbling.
Green Solutions Recycling, which operates a waste recovery center on Telegraph Street in Reno, has found a significant revenue stream recycling cardboard from regional businesses and exporting it to China, where it’s repurposed and used in packaging goods exported back to the United States and other countries.
It may seem a circuitous route, but the price paid by large Chinese cardboard mills is much higher than prices paid by domestic recycling firms, says Bill Bielser, president of Green Solutions Recycling.
And a rebound in the Chinese manufacturing sector has prices for cardboard trending upward after a nearly 50-percent drop in price during the summer. Cardboard currently sells for about $160 a ton, Bielser says, up from $100 a ton during the summer but still off its peak of about $190 a ton at the end of 2011.
“China is starting to fire back up their manufacturing activity,” he says. “Prices dipped when China slowed down its productivity and started exporting less due to world demand, but now the price is back up because they are using more of it.”
Beau Peck, director of sales and marketing for Interwest Paper of Salt Lake City, which services six western states, including the Interstate 80 corridor in northern Nevada from Winnemucca to West Wendover, says that although export demand often see-saws, mills in China and India still need a large supply of fiber on a daily basis.
“They don’t have the raw goods to produce what they need, so they depend on us to keep the flow going,” Peck says. “It has been pretty steady.”
Interwest also ships baled cardboard to two mills in California and one in Oregon. Domestic mill prices, Peck says, typically run alongside export pricing in order to be competitive, but they can lag by $5 to $10 a ton.
“The export market for the last year was pretty healthy,” he says. “They do pay more as they want to secure tonnages, so it is a little more lucrative to export.”
Green Solutions Recycling works through a commodities broker, which sometimes sells the company’s cardboard to one of two northern California recycling centers in San Leandro and Santa Clara when there’s demand. But overseas pricing usually outstrips that of domestic recycling mills.
“China pays substantially more than the two California mills,” Bielser says. “You can sell it in the U.S. but China pays more money for it.”
Much of the mountainous pile of cardboard at the Green Solutions facility comes from the region’s large logistics centers, which receive materials from vendors in large cardboard shipping boxes that otherwise would enter the waste stream.
Green Solutions takes in about 250,000 yards of material each year into its building, and from those truckloads the company’s workers pull out roughly 15 tons of cardboard per month.
On a busy month, Green Solutions sends six full shipping containers overseas. It takes 42 bales of tightly compresses cardboard to fill a shipping container, which is delivered to the Port of Oakland and then is sent on to China aboard a gigantic cargo container vessel.
Green Solutions Account Executive Rick Lake says business is picking up and that those recycling figures are sure to go higher.
Green Solutions Recycling employs between 15 and 20 workers who sift through a huge pile of debris for recoverable items such as aluminum, electrical cord, tin, plastic bubble-wrap and wood in addition to cardboard. The company also has a cardboard pickup route with a driver that collects cardboard and brings it to the facility.
The cardboard has to be clean it can’t have touched foodstuffs. Debris that has come in contact with food is termed garbage; if it hasn’t been contaminated by food it’s considered debris or trash. Business customers can deliver clean cardboard free of charge to the facility, Lake says.
The unanimous approvals Wednesday came despite state leaders promising to tighten up requirements for Nevada’s tax abatements and incentives for future companies.