Recycling back to the future

By Eric Love and Christopher Rochfort*
Friday, 04 October, 2019

Recycling back to the future

The recent global waste recycling crisis has focused us on the importance of developing localised markets for recyclable materials. After several years of product development in Australia during the ’90s, recyclers and cities opted to ship materials offshore to markets that offered lower-cost alternatives compared to developing local markets, particularly for plastics manufacturing. This course of action has now come back to haunt us.

Paper was already going offshore. Glass was mostly going into new bottles but as waste generation continues to increase, glass has exceeded the limit for glass making and needs new markets. There are enormous stockpiles of glass all around Australia.

Investment was needed then to establish local manufacturing but shipping to Asian markets put an end to any prospects for investment in local plastic manufacturing. Many plastic products that were at proof-of-concept stage floundered because of lack of confidence in obtaining sufficient supply to justify local investment in manufacturing. Successful HDPE, PP, PET and mixed plastic products were becoming market ready but needed market support.

Moving forward we need to be careful to ensure that we aren’t reinventing the wheel when it comes to developing recycled-content products. After four decades in the waste and recycling industry, we believe that sufficient value-added recycled content products for higher-value markets already exist. Many of these products and markets were originally developed in a localised strategic context and only need funding resources to resurrect them. Many of these strategies and technologies were forgotten, obscured by the passage of time.

While the dry recycling fractions were being shipped offshore, the recycled organics segment took a different route — localisation. This was primarily due to several key factors including transport costs for lightweight materials, biosecurity issues and the lack of perceived value in the products (there isn’t a spot market for recycled organics).

Several market research and characterisation reports and field research studies culminated in a comprehensive marketing strategy. The strategy, developed by Centre for Organic Research and Education (CORE) in 2000, was influenced by direct input from an EPA NSW convened expert reference group consisting of LGAs, EPA NSW, Dept of Agriculture, processors and universities. This created a robust strategic context for sustainable market demand including for value-added products that can reduce reliance, and put downward pressure, on gate fees. The strategy is as applicable today as it was then, if not more so.

Careful not to put all the eggs in one basket by reliance on one market, the group advocated for pursuing a diversity of key market priorities based on robust research evidence including strong technical efficacy, innovation, receptivity and affordability. The landscape market was already well entrenched with strong demand, so the sectors selected for demand acceleration were agriculture, rehabilitation, environmental remediation and special projects. It seemed like organics was well set to create its own sustainable local markets.

But what happened? A change of government that didn’t see itself as having a key role in developing recycling markets stifled progress. Due to low policy support, much of the momentum was lost. It became quicker and easier to tender collection and leave the markets up to the waste processors to worry about. Ensuing mounting stockpiles have now provoked a response. Twenty years and many millions of dollars later, funds are being granted for market development because of a market failure to create sufficient markets for all recycling fractions including for the rapidly increasing quantities of organic waste being generated.

CORE, on behalf of, and in collaboration with, its members continued to pursue recycled organic markets on a shoestring budget derived mostly from member levies and small sporadic grants. Intuitively, it seemed obvious that because of the substantial technical benefits of adding organics to soils, peri-urban farmers would “lap it up”. Experience revealed that, as good as the results were, many farmers did not have sufficient resources to pay for materials. After an early adopter burst flattened and drought set in, it was confirmed that agriculture would not be the panacea expected, confirming the diversity pathway promulgated by the EPA Expert Reference Group in 2000.

Repeated experiential research conducted by CORE showed there were major affordability issues for farmers. Even with lower-cost farming system modifications introduced by CORE, most farmers simply do not have the money to purchase recycled organics, even at prices subsidised by gate fees.

CORE began to view the peri-urban agriculture sector as primarily a “contingency” market. When there’s too much stockpiling in the system farmers can take the lower-cost “overflow” materials. Lower-cost farming systems with low processed but compliant products maximised demand in the sector but it is still falling well short of the demand needed for the volume of organic waste being generated.

This low-cost, low-processing approach was not viewed favourably by some public and private sector organisations who have different ideas about the organic processing and supply business model. The fact is that the “overflow” contingency model allows time to develop other markets as well as preventing dumping on existing markets that would have had a more catastrophic impact on industry pricing and bottom line.

The lesson to those dealing with the current waste crisis is to spend the time on identifying and assessing the markets before considering what products to “remanufacture”. Consider customer affordability and chose demand led, not supply push strategies and tactics.

Our concern is that some public and private sector organisations don’t understand fundamental marketing. It takes more than public relations exercises to create sustainable market demand. A few ad hoc projects do little to increase purchasing patterns, it’s longitudinal campaigns based on solid market research that create sustainable demand. We hope that the lessons of the past will guide the allocation of funding that doesn’t reinvent the wheel and avoids the mistakes of yesterday. Unfortunately, we have already seen very costly instances of this.

Nearly 85% of all recycled organics is marketed at the low price, highly processed end of the marketing matrix. This has led to an emphasis on high gate fees to subsidise manufacturing costs.

More emphasis needs to be placed on value-added applications for all quality processed recycled materials. There are many products already out there ready to go. Proper market analysis, product development and evidence-based marketing strategies need to be developed by experienced professionals.

CORE is now creating recycled content products, systems and markets for glass, plastics and organic recyclables. We reiterate our 25-year position of advocating market diversity as outlined in the 2018 Blueprint for Market Development. We urge decision-makers to support a shift to a portfolio of a “marketing mix” with low-, medium- and high-value products and markets. Well-developed strategic approaches can incentivise the waste and recycling industry to look for more, higher-value markets. This may even enable industry to invest in further R&D and marketing to make Australia self-sufficient in beneficially utilising its recycled materials and subsequently restore the confidence of the community.

*Eric Love, Chairman and Christopher Rochfort, CEO of Centre for Organic Research & Education (CORE) have experience spanning four decades. They are the originators behind many of the innovative technologies and practices in the recycling, waste, agriculture, landscape and stormwater markets that are now commonplace in the Australian community.

Key innovations initiated include:

  • Instigate and deploy wheelie bin systems for waste and recycling.
  • Deployment of robotic arm bin lifting system.
  • Deployment of the first Australian material recovery facilities.
  • Instigate composting of recyclable organic waste.
  • Development of low-cost farming systems using recycled organic materials.
  • Characterisation and strategies for recycled organic market demand creation.
  • Development and systemisation of Advanced Biofiltration Technology.
  • Kerb Gully Bypass System (STAR System).

With a partnership extending over 25 years, the founders have established several successful businesses including companies, partnerships and not-for-profit entities and held leadership and director roles in these companies and in industry associations in the respective sectors in which they operate.

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