Recycling prices plummet for Austin

AUSTIN (KXAN) - The City of Austin's single stream recycling program produced less than desirable profits for during its first month of collection, according to a recent city memo. Prices for recyclable materials worldwide caused the steep drop in profits for the city's new single stream recycling program, said Solid Waste Services Director Willie Rhodes.

Austin only made $27,444 in October, the first month of the new program. Revenues for the year are projected at $1.5 million. If the pattern holds, Austin would only make $329,328 for the entire year.

Rhodes said the department compared prices for the market between September and October. If the program had started in September, Rhodes said, Austin would have made $110,800. Rhodes said it was a 75 percent value reduction in the market in a one month time period.

The city recently overhauled its recycling program, replacing 14-gallon recycling bins, with 90-gallon carts. The make over allows Austin residents to combine all of their recycling in one cart, without sorting.

Critics of the costs of the new single stream program said Austin is losing money on a contract to haul recycling out of town.

"Taxpayers are hurting because of this," said Rick Cofer, co-chairman of a committee that oversees the city's Solid Waste Services department. "The total collapse of the recyclable commodity market only occurred part way through the first billing period."

Cofer said the city did not negotiate a good deal with Vista Fibers, a private company that has hauled Austin's recycling to Garland. Future plans call for the city to haul recycling to San Antonio.

"It should have been a home run and it's turned into a double," Cofer said "It's still good to hit a double, but when you're expecting a home run and we should have had a home run, it's very concerning that we're only on second base.

Rhodes disagreed saying the city experienced an 18.4 percent increase in collection from the same time in 2007. "If this trend continues," he said. "we will exceed the volume of recyclable material collected by greater than 40 percent."

"Single stream, we hit a home run with single stream," Rhodes said. "Everything we've been wanting to do is happening out there."

While the memo said the Asian market for recyclable materials will pick up in 2009, Rhodes remained less than optimistic about the prices for recycling in the next few months.

Other recycling facilities in town are hurting as well. Ecology Action, a non-profit organization dedicated to education about recycling, lost 60 percent of its revenue do to the downturn in the global recycling market. Though it tries to recycle items as locally as possible, the global market still has a trickle down-effect, said Scott Crow, a worker at the facility. "The prices didn't drop just a little bit," he said. "They dropped dramatically."

Crow said he is concerned about Ecology Action's future, and how long it can weather a rough market.

"I think it's urgent that we receive aid now" he said. "Because 60 percent of our income just went out the door."