What are the key waste trends that will impact your business this year? We’ve rounded up the top three trends to note, and included recommendations on what you should do.
1) Your Waste Streams Are Becoming More Valuable
Demand for recycled plastic, paper and cardboard is up, which means they are becoming more valuable. The trend is being driven by an increasing number of consumer brands making recycled content goals. For example, Kimberly-Clark Corporation, producer of many familiar paper-product brands, has set sustainability goals for 2030 that include reducing their national forest fiber by 50%. This means they will be in the market for more recycled paper. In addition, companies making carpet, clothing and other products out of plastic fiber have increased demand for PET bottles. Waste streams are becoming more valuable for a number of other reasons included below:
- PLASTIC: Although making virgin plastics from fossil fuels is still cheaper than the recycling process that yields plastic pellets, higher oil prices and commitments from corporations to reduce their use of all types of plastics and increase the recycled content of their products have made recycling more attractive. Transportation costs, particularly rates for ocean shipping containers (the primary means of transport for PET resin from overseas to the US) have gone up, making domestically recycled plastics a more viable option.
- PAPER: New or expanded pulp and paper mills have been coming online in the U.S. since 2017 to meet increasing consumption of cardboard and mixed paper. Nine Dragons, the largest paper company in China, has purchased multiple U.S. recycled fiber mills in part to ship recycled dry pulp to the company’s manufacturing operations in China. All this means increasing domestic capacity to process recovered fiber, keeping prices stable and attractive to the market.
- CARDBOARD: The jump in e-commerce over the pandemic has created increased demand for cardboard boxes. The cost of paper pulp—the main component of cardboard— was up 10% to 15% last year.
What does this mean for your business?
This is an opportunity to take advantage of available credits and rebates. How? By ensuring recycling streams are clean (so you can tap into the increasing value of your recyclables), and conducting a waste audit to get data you can use in hauler negotiations for credits and rebates.
2) Waste Costs Will Keep Rising
Waste costs have been rising over the past decade and the pandemic has exacerbated it. Current market conditions will keep pushing waste costs up in a number of ways.
- Waste companies are levying steel surcharges as high as 25%. Steel is a primary commodity used to fabricate compactors and trash containers used in waste management. Steel mills shut down at the beginning of the pandemic and were slow to resume operations, which led to steel shortages, pushing up prices. The rise in steel prices is expected to decelerate this year but delays in delivery of waste equipment and higher prices will continue in the near future.
- Fuel surcharges are being pegged to rising diesel prices. Because most waste hauling vehicles are still diesel-powered, waste management companies pass on the increased costs to clients through rate increases and surcharges. One of the largest waste companies has its standard fuel surcharge calculation tied directly to the national average price of diesel fuel as reported weekly by the U.S. Department of Energy. Diesel prices rose 24% over the past year and a half.
- Worker shortages are continuing to affect service. The waste industry has lost over 600,000 workers in the past year and a half. The loss has been particularly acute among sanitation drivers, many of whom have either moved onto other industries (Amazon, food & grocery delivery services) or aged out of the workforce. In response, many haulers are not operating their full fleets because of worker shortages. Expect waste costs to rise as waste management companies move to raise wages or pay overtime costs to bring workers back.
- M&As are consolidating the industry. Mergers and acquisitions in the waste and recycling industry have reached “historic levels,” with big players gobbling up smaller companies across the country. In short this means less competition, less choice for your business’s waste needs, and potentially higher prices.
What does this mean for your business?
Keeping a close eye on costs and having strong relationships with haulers across the country are key now. Businesses must be able to negotiate and work with their hauler partners, or be forced to look for alternatives, which may be limited. A waste broker can provide valuable assistance at this time. Great Forest’s waste brokerage division, for example, utilizes our nationwide portfolio of waste haulers to leverage better pricing and make adjustments to service as needed for clients across the country.
“This is the first time I have ever come across waste haulers who tell me they cannot provide service because they have run out of waste containers. I heard one manufacturer is 15,000 containers behind in orders, driven partly by a shortage in steel when plants slowed down production at the start of the pandemic,” — David Troust, Chief Development Officer, Great Forest.
3) Waste Is Gaining National Attention
As the biggest generators of waste, businesses will be expected to play a role to help the country achieve goals being set nationally. These include:
- U.S. President Biden’s Methane Emissions Reduction Action Plan. With landfills being the third-largest source of human-related methane emissions in the country, there will be added pressure to reduce waste going to landfills. This is in line with the UN’s Intergovernmental Panel on Climate Change (IPCC) report, published in August 2021, that for the first time put a focus on reducing methane as an essential strategy to combating climate change.
- The EPA’s upcoming circular economy goals are expected to include details on source reduction efforts, especially addressing food waste and organics recycling. This will build on their first ever National Recycling Strategy, which was released in 2020, with a goal to increase the national recycling rate to 50 percent by 2030.
What does this mean for your business?
- In the long term, you should plan to get ahead of potential regulations, and show leadership by moving towards a Zero Waste strategy. Whether you decide to get TRUE Zero Waste certified or not, a Zero Waste strategy will effectively help you maintain waste reduction goals.
- In the short term, implement an organics program if you do not already have one at your business or facility. Food waste consistently makes up the largest portion of a building’s trash stream globally.
- Calculate your GHG from waste to get a clearer idea of how waste affects your carbon footprint.
Photo: Vivianne Lemay, unsplash