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The downturn in the global economy has affected the recycling program
operated by Bruce Area Solid Waste Recycling.
Kincardine councillor Randy Roppel told his council Wednesday (Dec. 10)
that the per-household cost for recycling will almost double next year
in order to continue the program in the municipality. "It's not just
here or across Ontario, it's worldwide," he said.
The current per-household cost is $17.22 to collect the recyclable
plastics, paper, boxboard and glass, truck them and sort them at the
plant near Southampton. "That cost has been significantly reduced since
the program's inception in 1991," said Roppel, "when the cost was
$21.40, mainly due to a high rate of return on commodity prices."
However, this year, according to a report by Bruce Recycling's general
manager Vince Cascone, the price of newsprint has dropped to $20/metric
tonne from $140/metric tonne; cardboard, to $25/metric tonne from
$153/metric tonne; steel, to $15/ton from $318/ton; aluminum, to 52
cents/pound from $1.07/pound; PET plastic, to one cent/pound from 20
cents/pound; HDPE plastic, to seven cents/pound from 36 cents/pound; tub
plastic, to one cent/pound from 12 cents/pound; boxboard to zero from
$103/metric tonne; and fine paper, to zero from $266/metric tonne.
In his report, Cascone said Bruce Recycling has been forced to forecast
a $446,283 shortfall in the expected product revenue compared to 2007,
due to the current marketing conditions throughout the recycling
industry. In addition to falling revenues, there is a shortage of end
markets at the current time, Cascone said, affecting the company's
ability to even ship some products. "We are expecting these conditions
to continue for most, if not all, of 2009," he said.
To cover the shortfall, the per-household cost would have risen to
$31.16 in 2009. However, Cascone has been able to adjust and lower some
projected costs for 2009, dropping the per-household cost to $27.13, an
increase of $9.91, for next year. He also noted that the Waste Diversion
Ontario grant for 2009 is expected to be $290,000 which is covering
$9.06 of the per-household costs. (next column)
13/01/2009 04:17 PM
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(continued)
Roppel told council that Bruce Area Recycling has
$544,737.95 in reserves but will be spending $310,000 of that on capital
costs for equipment next year. The company is fortunate that it has a
storage building because much of the product will have to be held if
there is no market for it.
"The bad news is it'll have to get larger because the current facility
is used to the maximum," Roppel said. "We have to decide where to go
with this. We could have absorbed this increase but if we offset the
cost with reserves, we'd be back a year later saying you have to pay
more. We have to swallow this bullet; the recycling service can be
provided, but at a huge cost."
On the bright side, Roppel said Bruce Area Recycling still has companies
taking the product, even if it has no value. Bruce Area Recycling is
meeting Jan. 15, 2009, to decide what direction the member councils want
it to take, he said. "I need direction from council for that meeting."
"We can't run it out of reserves," said councillor Ron Hewitt. "The
price (per-household) will have to increase to cover the cost. The
recycling markets will stabilize in the future. Bruce Area Recycling
does a great job. I support it (the increase)."
"That's about one per cent on the tax rate," said mayor Larry Kraemer.
"When the markets rebound, there will be opportunity to expand the
facility."
The committee supported the per-household increase. That motion goes to
council this Wednesday (Dec. 17)
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