Attached is your PO for deliveries of recyclables during August 2022.
The value of recyclables is again down significantly this month. All grades of paper, plastic, and metals dropped.
Before discussing specific grades, it is appropriate to reflect on the general recycling market. While generation of recycled materials is down an estimated 10% compared to last year this time, the demand for all recyclables to produce consumer products is down even more. This decrease in demand is a direct result of rapidly rising inflation rates. Consumers are buying less products and making fewer Amazon purchases. Additionally, the rising inflation has drastically reduced construction activity. These economic trends drastically reduce the demand for all recyclables.
Recycled paper demand is very weak in the Pacific Northwest (PNW). Two domestic mills are taking two or more weeks of maintenance downtime this month. While maintenance downtime is not unusual, both mills moved up their planned downtime to this month because of low demand for their product. Moreover, the global economic downturn substantially reduced demand for recycled paper, causing export prices to fall 25% or more this month. Another factor causing instability in the global paper market is China’s military actions around Taiwan. Much of the recycled paper going to the Asian market is transloaded in Taiwan. Asian customers shutdown the Taiwan transloading operations with the uncertainty created by China’s military aggression towards Taiwan.
As we have previously written, construction (pipe or carpeting) and in clothing consumes much of the recycled plastics market. The economic situation has almost shutdown demand for recycled plastics to the construction and clothing industries. Also, consumers are spending less on liquids bottle in PET bottles. Outlets for rPET is extremely difficult to find. Once found, the pricing for that plastic grade is down 80% over the last few months.
Although not as drastic as paper and plastic markets, the looming global recession created price drops in all metals. Barring some unforeseen event upsetting the UBC market, there are some economic indicators that falling UBC prices will slow down in coming months as the market stabilizes. Tin and other metals will most likely continue to decline.
During these challenging times, we will always strive to obtain the best pricing available and to provide you the best possible service. It is our pleasure to collaborate with you to recycle material and to protect our environment. We appreciate you and thank you for your business.