The chief executive of the largest recycling and waste management company in the United States has warned that recycling is increasingly unprofitable.
Waste Management’s boss David Steiner revealed in the company’s first quarter results that recycling prices had fallen by 14% from January to March, forcing revenue from this income stream down by $70 million (£45.3 million).
This was the major contributing factor to an overall fall in revenue to $3 billion for the quarter and a loss of $129 million for the three months to March.
With quality of material collected becoming worse for the company, it is requiring further investment to sort material. Plus commingled glass is also causing equipment to wear faster and it is having to pay glass recycling companies $6 million to take it away.
Overall, recycling is therefore becoming an unprofitable revenue stream for the company and this means it is having to close facilities.
Four plants were closed during the past year by the company, and it plans to close more.
David Steiner said: “Recycling is in a crisis. It isn’t profitable for us, and we have to react to that by shutting down plants.
“[Prices for recycled materials are] as low as it’s ever been, but we haven’t seen any indication of a bottom.
“Unless we can work out a way where recycling is profitable over the long term, there’s not going to be recycling. And customers certainly don’t want to live with that.”