Chicago recycling not so sustainable, cutbacks loom as demand from China cools

Harder times are ahead for Chicago’s Resource Center, the non-profit that runs a number of community recycling centers on the North and South sides.

Facilities in North Park, Uptown, Lincoln Park and Greater Grand Crossing may be forced to cut back on their recycling of certain materials in order to compensate for dwindling revenues.

“If they’re going to do it they would do it in stages,” said Kristin Albee, a 25-year-old center employee.

At a meeting of the North Park Village Advisory Council Wednesday, Albee broke the news of possible cutbacks in local recycling operations, citing a drastic drop in wholesale prices of recyclables in Chicago.

According to Albee, the buyback rate of cardboard and newspaper at Chicago recycling yards has plummeted from approximately $120 a ton just last summer to $20 a ton now on a good day.   

On a bad day, the center actually has to pay the yards to take its goods, Albee said.

This follows a chain reaction in which robust exports of recyclables, specifically to China—the largest customer of waste materials—dropped at the end of the summer, depressing prices nationally and locally.

According to the U.S. Bureau of Economic Analysis, pulp and waste paper exports dropped by 8.6 percent between August and September.

Though not yet released, there isn’t much hope that October numbers will be much better.

“October was a horrendous month for recovered paper recycling,” said Mark Arzoumanian, editor in chief of Official Board Markets – the weekly industry standard for recycled paper trading.

China may hold an explanation as to why recycling markets are doing so poorly, said Mike Mitchell, executive director of the Illinois Recycling Association.

According to Mitchell, over the course of the past year and a half, Chinese demand for recyclables has resulted in historic highs for U.S. recycling markets. “Growth in recycling has been through exports,” Mitchell says of the domestic recycling market.

According to Mitchell, the drop in Chinese demand for recycled materials started just after the Beijing Olympics.  He said Chinese factories were forced to halt manufacturing activity to help improve air quality running up to the Olympics.  But as production halted, these same factories were still ordering recycled materials.   

The result was that when factories resumed production after the Olympics, they were faced with warehouses overflowing with recycled materials.   

Mitchell said the Chinese reaction to the overflow was to abruptly stop ordering recyclables until production could catch up with their supply.

Before Chinese factories could catch up, however, the American economy took a turn for the worse.

Mitchell explained that there is a firm link between American consumerism and Chinese demand for recycled materials.  This link is rooted in the fact that so much of what consumers use every day comes from China: the paper bag your bagel comes in or the cup, sleeve, and top of your coffee.   

When American consumer purchases decline – as they have over the past few months – and people stop buying their coffee at Starbucks and start making it at home, the demand for coffee cups follows suit.  

Less demand for coffee cups from China results in less demand for recycled coffee cup material from the U.S.  

In the end, if we aren’t buying Chinese products, China isn’t buying our recyclables and that’s one less place to take your bottles for reuse.

Mitchell said he remains optimistic.  “There is nothing wrong with the recycling system we have,” he said, and all we need is a consumer rebound for Chinese demand to return.

Because China is projecting economic growth in the coming year, Mitchell said he is hoping the current slump in recycling markets won’t last past next year.

In North Park, the question is whether or not current recycling programs will be able to tough it out.

Albee puts it in perspective: “It takes me one week to fill up a newspaper bin,” she said.  “If they hit the yard on a good day, there’s three tons of newspaper in one bin, that’s $60 for one week’s worth of paper.  That doesn’t even pay for me to be here for a day.”

Former North Park Recycling Center employee Ted Zielinski, 65, worked at the center for 14 years. Zielinski says that it is so much more than just a recycling center: “We did so many other things in the community, and to get the community involved as well.”   

He points to a bulletin board that sits apart from the center’s sorting bins.  “Anything of interest from a church, a school, a club that you want to post and pass on to the rest of the recyclers, that’s why I made this,” he said.

According to Albee, the center will need a miracle in the form of generous donations or grant money to make it through this crisis.