Like watching a turnstile, a materials recovery facility (MRF) has to carefully pay attention to what comes in and what goes out. If its end-product markets are there but raw materials are not, financial trouble will result. Likewise, if raw materials are plentiful, but markets are abysmal, success likely will be difficult as well.
Waste Age spoke to the managers of four MRFs - one publicly owned, one non-profit, one small independent and one owned by the largest solid waste company in the world - about the challenges of successfully managing a MRF in today's economic environment.
Despite wide gaps in the demographics served, tons per year processed and access to markets, these four MRFs have one thing in common - their success. The formula for it includes balancing cost-efficient marketing of quality materials with operational issues such as technology and employee retention.
Managing Markets Each of these MRF managers takes pride in providing service to those who want to recycle and producing a quality product for customers - the mills that use recyclables to create new products - which is no easy feat as mill specifications continue to grow increasingly tighter.
"Because of our community involvement, we get very clean materials, so we can produce a very high-quality product and get good market prices," says Jerry Martin, the general manager of Eco-Cycle, a non-profit organization based in Boulder, Colo., that processes 40,000 tons per year.
No matter what their size, these successful MRFs focus on marketing. "Your marketing end and your operations end have to be in tune with each other," says Patrick Carroll, assistant director of recycling for the Solid Waste Authority of Palm Beach County (SWA-PBC), West Palm Beach, Fla. "One has to sell what the other makes, and the other has to make what the first one can sell."
Eco-Cycle's and SWA-PBC's MRFs both market newsprint collected at the curb as No. 8 news, with less than 0.25 percent outthrows (rather than No. 6 news, which allows up to 5 percent outthrows and is the standard grade for newsprint from curbside collection programs). The difference is significant - No. 8 news is a de-inking quality grade that often sells for three to four times as much as No. 6 news. In some parts of the country, when the value of No. 6 plunges to zero or negative prices, No. 8 will produce at least small revenues.
Both facility managers attribute their ability to market their old newspaper (ONP) as No. 8 to extensive public education efforts. The SWA-PBC often includes messages about the importance of quality in its education materials. For example, last year's outreach theme was "Recycle Right."
Eco-Cycle employs several community educators, instead of large numbers of sorters. "So we get very clean materials," Martin says. "We can pick out a little bit of contamination and have No. 8 news to market."
Nevertheless, operating a facility at the mercy of global commodity markets is frustrating and wears away at the bottom line. "Our operating expenses remain constant, yet product prices erode or get stagnant," says Terry Horst, operations manager for Minnkota Recycling, Fargo, N.D. Horst's facility, which processes about 21,000 tons per year, is the largest in the state.
Processing more than 10 times the amount of Minnkota, Waste Management of Alameda County (WMAC), San Leandro, Calif., experiences similar problems, but can fall back on its national presence to help smooth out bumps in the market. "As a nationwide company, we are trying to commit our fiber materials to contracts with floor prices to level off the wide ups and downs," says Kevin McCarthy, WMAC's region recycling manager. Floor prices are the minimum prices buyers agree to pay for a commodity even if the actual market price plunges below that. Waste Management also has internalized all of its marketing operations into 11 "Recycle America" offices nationwide since its merger with USA Waste Services Inc., Houston, McCarthy says.
Yet no MRF is immune to market downturns. The most difficult product to process and market is plastic, especially those with resin codes 3 to 7, Horst and McCarthy say. McCarthy estimates more than 50 percent of the labor on his curbside sorting line is devoted to plastics, a figure consistent with the one Horst offers.
"It's so light and so time-consuming, it's very hard to make money [on plastics]," says Horst, who asks residents to recycle only polyethylene terephthalate (PET) and high-density polyethylene (HDPE). When other plastics are thrown in the collection containers, Horst has to landfill them.
Waste Management's McCarthy accepts a broader assortment of plastics and is relieved to have a local market for it, but notes that if the one local company accepting his mixed plastics went under, finding other markets would be difficult.
Linked to the difficulty of negotiating market prices are the associated costs of transporting materials to buyers. WMAC operates the nation's first and largest integrated screening and grinding system for yard trimmings and wood waste, providing landfill diversion for 500 tons per day of material. But trucking the materials to other facilities for composting is expensive, so McCarthy is looking for closer markets.
For a rural MRF like Minnkota Recycling, whose closest market is 200 miles away, rail and trucking expenses are unavoidable and often cost-prohibitive. Horst had to drop Minnkota's textile recycling program when recycled textile prices dropped, making transportation to East Coast markets unprofitable.
Maintaining a qualified and committed workforce also can be challenging, especially with a roaring national economy. With an unemployment rate of less than 1 percent in North Dakota, Horst sometimes has difficulty keeping sorting crews. "The commodity markets don't allow us to pay the salaries we'd like to pay," Horst says. "So we try employee recognition programs and pay what we can, but it's still difficult to maintain a solid core staff."
Finally, MRF managers are concerned about worker health and safety. When revamping their sort lines, facilities are paying more attention to ergonomics to reduce worker fatigue and repetitive stress injuries. Managers also express concern over hazardous materials such as pesticides, bloodborne pathogens and even canisters of pepper spray that appear on curbside sort lines. Proper training and regular reminders of the hazards, combined with community education, are cited as the best solutions.
The Same Old Changes New technologies such as single-stream systems and optical sorting equipment may help MRF managers improve efficiencies in their operations. Optical sorting equipment such as the glass cullet separation system the SWA-PBC plans to install can take a low-grade product like mixed cullet and separate the more profitable flint from the green and amber glass. But it's difficult to justify the expense associated with an optical system without significant tonnage, eliminating this as an option for smaller companies like Eco-Cycle and Minnkota.
By combining all materials on the collection route, single-stream programs can save considerable money in collection, but can increase processing costs. Companies such as Waste Management are betting the savings will be worth it overall. According to McCarthy, Waste Management has successfully employed single-stream systems, which rely on a new generation of screening technology to separate fiber from containers.
With these two exceptions, however, MRF managers see a void in affordable, new technologies. "Almost every MRF in the country still is heavily reliant on manual labor," says Palm Beach County's Carroll. While mechanical systems have improved over time, basic tools, such as air classifiers and eddy currents have been around for a long time.
Fortunately, the lack of significant advances in MRF technology may not matter much. Eco-Cycle's Martin believes that the new technologies at the mills that will allow them to take a broader mix of materials will have more impact on recycling than new MRF technologies. Assuming MRFs produce a good-quality product, he believes incremental improvements in processing capability, such as removing small amounts of contamination, are likely to be more efficient and cost-effective when done at the mills, which already rely on sophisticated technology, rather than the rudimentary hand-sorting used at most MRFs.
Words from the Wise All of the MRF managers agree that knowing the markets is the most critical element of a successful MRF. Demonstrating flexibility and a willingness to change product mixes according to a mill's needs can help build lasting relationships. Some facilities get caught in a cycle of collecting and baling whatever they get as cheaply as they can, Martin says. While it may produce short-term results, in the long term, that approach will make profitability difficult.
Rather than trying to push inferior materials on the market, Martin recommends a "pull" philosophy to MRF management, where the operator lets the mills' needs dictate collection and processing at a facility. "You have to talk to the mills and find out what's going on with them," he says. "Then develop your products with them in mind."
SWA-PBC's Carroll recommends developing a strong network of buyers, so when one mill is having downtime, other options, including brokers, are available. Getting to know the people you are selling to is important, he says. Carroll's marketing manager sometimes talks to mills daily, taking bids for his materials and arranging transportation.
With fewer markets nearby, Minnkota Recycling's Horst takes a different approach by staying faithful to his buyers through the commodity market ups and downs. "Don't flip-flop from market to market," Horst advises. By holding regular business review sessions with his customers and by providing consistent products, Horst says he always has a slot for his materials - even if the prices drop from time to time.
Finally, WMAC's McCarthy reminds MRF operators to look at their local communities and do a thorough search for possible local markets. "When we went into tire recycling [and built a crumb rubber facility on the property], we found local companies either already using crumb rubber or willing to switch to it," McCarthy says. Local markets save transportation costs and provide marketing stability - two benefits no MRF manager would dispute.
SWA of Palm Beach County, Fla. * Facility: Residential MRF
* Service Area: Palm Beach County
* Refuse Processed: 115,000 tpy
* Sources of Waste: 100% residential
* No. of Employees: 86, including sorters, equipment operators, maintenance personnel, clerical and supervision
* Processing Equipment: 3 compactors (RRT and Hesco); 4 compactor containers (Hesco); Various conveyors (Countec, Bollengraaf, CP Manufacturing); 3 loaders (Case); 4 trommels (Countec)
Minnkota Recycling, Fargo, N.D. * Facility: MRF
* Service Area: 100-mile radius of Fargo area
* Refuse Processed: 21,000 tpy Sources of Waste: 25% city and county waste; 72% commercial; 3% other
* No. of Employees: 30 full-time; 4 seasonal/part-time
* Processing Equipment: 1 flight conveyor and sort table (Dover); 1 cross belt mag- net; 1 flight conveyor (Lovegreen); 1 twin ram baler (Selco); 1 can blower and container system; 1 glass crusher; 1 fork lift rotator; and 4 fork lifts (Toyota and Bobcat Melroe)
Eco-Cycle Inc., Boulder, Colo. * Facility: Eco-Cycle Processing Center
* Service Area: Boulder, Colo.
* Sources of Waste: 54% residential curb collections; 27% from eight Eco-Cycle-operated drop-off centers; 28% commercial collections by Eco- Cycle and private haulers
* Refuse Processed: 40,000 tpy, 99.4% as marketable recycled material and 0.6% as trash. Facility runs five days per week and is running at 75% capacity
* No. of Employees: four administrators, 21 processing workers, 25 com- mercial collections and business development employees
* Processing Equipment: 1 two-ram baler model HLBA 100 (Molsey); baler feed conveyors (Karl Schmidt); fiber sort system (Karl Schmidt); 2 container sort systems; 3 forklifts (Hyster H50, Hyster H60, Daewoo); 4 loaders (John Deere 644E, 2 Waldons, International IH65C); 3 roll-offs; 3 recycling trucks (Eager Beaver); 2 tractors (Kenworth, White); 6 45-foot trailers
Waste Management of Alameda County, San Leandro, Calif. * Facility: Davis Street Station for Material Recycling and Transfer
* Service Area: San Francisco Bay area
* Refuse Processed: In 1998 more than 219,000 tons processed and more than 750,000 tons transferred for disposal. The facility's permitted capacity is 5,600 tons per day
* Sources of Waste: Private haulers, city and county operations, residential, commercial and industrial. 70% of incoming tonnage is from intercompany sources
* No. of Employees: 180 employees (72 dedicated to recycling)
* Processing Equipment: curbside container (bottles and cans) sort line (Ptarmigan Machinery and Karl Schmidt); 300 hp horizontal, 2 ram baler (Enterprise Baler Co.); portable mixed waste sort line (Ptarmigan Machinery); wood and yard material screening and grinding system (Bulk Handling System, Lubo USA, Krause Mfg.); power grid C&D screening system (Powerscreen); tire recycling and crumb rubber factory (Link Recycling Technology)