Bringing the market closer – Resource recycling

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This article originally appeared in the August 2022 issue of Resource Recycling. Subscribe today to access all print content.

For more than 30 years, the Plastic Recycling Corporation of California (PRCC) has proven that a voluntary producer responsibility organization can successfully manage the recycling of a specific product at the state level.

PRCC strives to keep PET beverage bottle recycling rates high while keeping recycling system costs low. Through its purchase and sale of PET beverage bottles, PRCC ensures market stability.

Both adaptable and resilient, PRCC successfully handles California’s huge PET recycling market with minimal disruption. For example, the organization has enabled California’s recycled PET to weather unforeseen and challenging events such as China’s National Sword Policy, COVID shutdowns, logistical disruptions, weak markets, policy adjustments public and the ever-evolving design of PET packaging.

As the broader recycling industry struggles to adapt to policy changes in U.S. jurisdictions, officials can learn much from the evolution of the PRCC and how it has worked to organize and align various links in the plastics recycling chain in California.

how it started

The PRCC was created in 1987 as a result of legislation: the California Beverage Container Recycling and Litter Reduction Act (AB2020), which established a bottle bill in the state.

The law meant that beverage producers selling or distributing in California had to pay a deposit and a processing fee. The processing fee was calculated as the difference between the scrap value of the containers and the cost of recycling them. This has led competing soft drink bottle manufacturers to make the unique decision to work collaboratively to implement an effective statewide recycling program to increase the recycling rate of their packaging.

Thus, PRCC was formed, developed as a voluntary producer responsibility non-profit organization that immediately began purchasing PET bottles. PRCC has also implemented innovative marketing and promotion strategies to increase reimbursement rates and public awareness of PET recycling.

At the start of the PRCC, there were no recovery facilities in California, markets for bales of post-consumer PET were limited, and most PET collected in California was exported to China via Hong Kong. PRCC staff have visited China on several occasions and have been briefed on China’s intention to end its dependence on Western imports of PET bales and develop its own recycling infrastructure . It is with this foresight that PRCC has prepared for market changes and actively developed California’s PET recovery infrastructure.

There are now six collection facilities in California, more than enough to handle all of the PET bottles collected in the state. This was accomplished by providing supply contracts to several facilities. These bankable contracts have helped PET collectors by guaranteeing a constant supply of raw material. PRCC also offers payment reliability and stability, even helping with credit at times, and PRCC supports California recovery facilities by actively working to keep PET bales in the state. The policy of keeping PET in the state is now more important than ever due to California’s recently enacted recycled content requirement. Currently, more than 90% of PRCC’s volume remains in the United States and the majority remains in California.

What makes it work

A key element of the PRCC’s work has been clarity of prices and market information.

The transparency of PRCC’s bidding system makes in-state PET bale pricing accessible to redemption centers and processors, ensuring economic openness. An open tender is held every two weeks, with California suppliers providing PRCC with a list of their baled PET loads by type and PRCC auctioning the unallocated portion of the loads for pre-qualified buyers to purchase. .

The PRCC then allocates the equipment to the highest bidder(s). The offer fixes the value of the equipment awarded to the purchasers under contract. This provides the industry with a true market price that is openly shared with recyclers to ensure they are getting the best value for their material.

Additionally, as a California-based organization with relationships across the PET recycling value chain, the PRCC is well placed to collect data and undertake research of great value to PRCC members, redemption centers, curbside operators, PET collectors, policy makers and other stakeholders.

For example, in 2019 the PRCC conducted a unique PET loss study, finding that 12% of clear PET is lost during recovery, and much of this is due to non-compliant PET bottles. such as opaque bottles, metallic components and non-compliant bottles. recyclable barrier bottles. (To see the June 2020 issue of Resource Recycling to learn more about this project.)

This data informed the PRCC’s legislative efforts to discourage non-recyclable and difficult-to-recycle PET.

Finally, the PRCC works regularly with all stakeholders to provide feedback from processors and collectors on recyclability and design issues directly to PRCC members – bottle and beverage manufacturers. These issues include colored bottles, full labels, barriers, and metal closures. This collaboration advances the dialogue and encourages the manufacturing industry to improve the recyclability of their PET bottles.

The quality of materials at the center of concerns

The quality of California PET bales is nationally recognized and is directly tied to PRCC’s work and advocacy in the state.

To promote quality, we have an active field agent who educates and provides technical assistance to MRFs, processors and redemption centers. The PRCC agent visits the facilities and provides assistance with sorting and baling, allowing PRCC to move material from each facility to the market that can best utilize it.

Each recovery facility has different quality needs. The PRCC agent organizes visits between suppliers and buyers so that everyone knows the quality and standards expected. However, our work is not done there; California reclaimers still deal with a wide range of contaminants in their bales, and PRCC staff continually strive to maintain and enforce PRCC bale specifications.

Bale quality in California is complex, as there are different collection methods: buyout, drop off, and various curb types, all of which impact material quality. PRCC’s research – including regular bullet sorting – leads directly to PRCC’s implementation of additional bullet specifications. When the PRCC started, there was only one specification of PET bales in California, but we now have four bale specifications: Class A (Redemption), Class B (Curb), Class B with Thermoforming (sidewalk) and thermoformed bales only.

The PRCC encourages the separation of thermoforms from bales of PET bottles. The reasons for this are twofold: to improve the quality of PET bottle bales and to create only thermoformed bales. By grading the bales, the supplier is rewarded for better quality with a higher price and the collector gets a higher yield. The variety of bale specifications helps PRCC staff ensure that collectors pay a price commensurate with yield and purchase the optimum material for their system, whether it is buyout material to turn bottles into bottles or of thermoformed products separated from PET bottles with the aim of developing thermoformed products – thermoformed recycling.

Based on feedback from California PET Collectors, PRCC has developed a Quality App so Collectors can provide instant bale quality feedback to help PRCC maintain bale standards. By improving the quality of PET bales, the cleaner material leads to higher scrap prices, which in turn improves the economics of statewide collection. While prices for recycled PET bottles are high today, scrap prices have sometimes been so low that margins have been squeezed and operations have struggled, exacerbating the problem of encouraging l opening of new redemption centers. PRCC’s culture of PET waste quality helps to ensure continued interest and a diversity of buyers for the material.

Maintain a strong presence

It is the direct knowledge of the market, through the purchase and sale of bales of PET, that allows PRCC to anticipate market disruptions and work to avoid disruptions. PRCC is able to respond quickly to issues such as port delays and facility closures because it has developed a diversity of buyers, which means there is always a way to move material to different markets.

PRCC’s longevity and credibility has resulted in the development of well-established relationships, which in turn enhance the stability, efficiency and consistency of the California PET recycling industry. They have enabled PRCC to gain a strong market position and support the growth of the salvage industry in the state. Armed with knowledge of PET recycling markets, bale quality and the full PET value chain, PRCC is able to quickly solve the problems and challenges that test the PET recycling industry, including contamination , collection and politics. PRCC advocates for the PET recycling industry to promote greater efficiency, cleaner materials and higher collection rates.

PRCC continues to operate with the same goals today as in its inception, working across the entire value chain with a system-wide approach. This results in effective and efficient PET bottle recycling that supports the entire PET recycling industry. PRCC is regarded in the state and beyond as an expert in the PET recycling industry – and as a market guardian, working to improve the quality and accessibility of bales of PET in circulation, and as a source unparalleled data on PET recycling in California and beyond.

Sally Houghton is the executive director of the Plastic Recycling Corporation of California and can be reached at [email protected]

This article originally appeared in the August 2022 issue of Resource Recycling. Subscribe today to access all print content.

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