Record low commodity values, combined with lower state subsidies are threatening the local recycling business, according to industry experts.
The combination has already forced one rePlanet, doing business as Nexcycle, to close two recycling centers in Orcutt recently, and more closures are possible.
“We’re afraid that those are not the last centers to close,” said Teresa Bui, legislative policy analyst for Californians Against Waste. “If we don’t do anything soon, we might hear about more closures.”
And the closures are occurring across the state.
So far, about 15.6 percent of the total statewide industry has closed shop, according to Mark Oldfield, director of communications at California’s Department of Resources Recycling and Recovery, known as CalRecycle.
While the industry has had a historical operational figure of around 2,100, only about 1,773 recycling centers remain across the state.
The problem, according to Oldfield, has to do with declining value of commodities like plastic, which has been hit hard by falling oil prices.
The lower costs mean that new plastic is cheaper and that recycling centers are making less money from the sale of the commodities.
Additionally, the state subsidies intended to make up the difference aren’t providing enough support, hence the uncertain market conditions.
Shannon Larrabee, operations manager for Larrabee Recycling, off South Blosser Road in Santa Maria, reiterated some of those concerns.
“The scrap value is in the toilet, so it’s financially becoming more and more difficult, especially for the small operators, to stay in business,” Larrabee said.
While Larrabee Recycling has no plans to close, discussions have occurred in the past.
“One thing that our family, you know, certainly struggles with is what a huge hit that would be on this community to pull an established recycling center like ours out of commission,” Larrabee said. “But it’s also got to be financially feasible and the state can certainly do a better job at working with us.”
To read the full story, visit http://santamariatimes.com/news/local/low-commodity-values-subsidies-threaten-recycling-industry/article_a6ab08f6-6488-540a-bd6a-bafd398e4df0.html.