Making the Transition to the Secondary Materials Economy Scott Mouw NC Division of Pollution Prevention and Environmental Assistance

The Recycling Market Picture Consistent and historically high prices in past five years. Growth in both domestic and global demand for recovered paper, plastics, metals, and glass. Global transition from a virgin materials to a recovered materials economy.

Growing Scarcity and Consequences of Non-Recovery Some materials face relatively quick depletion, e.g.,: –Zinc – years of available virgin material –Silver – years –Peak oil? Scrap shortfalls? One analyst predicts that the bulk of discarded steel scrap will be depleted within a decade. Recovery rates already high. Declining supply against rising demand will increase inflationary pressures worldwide. Coupled with economic effects of climate change, challenges ahead….

“Governments can effectively facilitate metals supply by promoting and facilitating recycling schemes that make economic and environmental sense.” World Bank, Report to G20 Deputies, 2006

Global consumption of recycled paper expected to rise steadily – increase of 25% in next 6 years. Data courtesy of Moore & Associates

Domestic Transition to Recovered Paper 78 percent of U.S. paper mills rely on some amount of recycled fiber

Official Board Market (Yellow Sheet) Mill Pricing for Mixed Paper, Newsprint, and Corrugated.

Chinese Demand for Materials PAPER METALS Chinese demand for quality scrap far exceeds its domestic resources. China is world’s largest scrap metal importer. Between 2001 and 2005, Chinese imports of ferrous, copper, and aluminum tripled. Chinese construction and automotive building boom will increase its appetite for scrap metals. U.S. is China’s biggest scrap supplier.

China Consuming More Recyclables 37% of recycle PET bottles going to China 400 million lbs. per year Over 40% of China’s imported recovered paper comes from the U.S. $100 million in paper exported to China from U.S. per month China building 16 million tons of recycled paper capacity by 2010

Underutilization of U.S. Domestic Plastic Bottle Capacity HDPE - Millions of pounds Source: Jerry Powell, Resource Recycling For PET, reclaimers in 2006 were operating at 84.2-percent capacity

End-Use Capacity in the Southeast: Manufacturers using recycled paper, metals, glass, and plastic.

Growth in Recycling Jobs in NC At least 14,000 jobs directly dependent on recycling and increasing steadily. Over 540 recycling businesses in North Carolina – almost doubling in 15 years. Recycling is helping keep manufacturing alive in North Carolina.

Recycling Essential to NC Manufacturers – Examples of products made in NC

URRC/Coca Cola Major Plastic Bottle Recyclers in NC (and nearby) SE Container Blue Ridge Ensley Plastics Revolutions Envision Recycle America Recycling Loop Closed in the Carolinas!

Glass Demand in North Carolina Manufacturers Can Double Use of Cullet Owens-Illinois St. Gobain

Priming the Pump in NC Education Legislation Programs –Municipal curbside assistance –Targeted grant-making –Outreach campaigns Product Stewardship

Policy Initiatives General Assembly starting to understand economic development aspects of recycling. H 1518 (2005 session): requiring all ABC permit-holders to recycle as of 1/1/08. H 1465 (2005 session): banning the disposal of pallets, oil filters, and plastic bottles as of 10/1/09.

Traditional vs. non-traditional materials Rosy picture for paper, metals, plastics, and glass: –Rising global and domestic demand –Mature infrastructure and healthy pricing –Main challenge is supply, not demand New generation of materials/products pose more difficult problems: -Fluorescent lights- Paint -Thermostats- Pharmaceuticals -Radioactive devices- Electronics -Gas cylinders- More to come….

Thank You! Scott Mouw NC Division of Pollution Prevention and Environmental Assistance