Green and wood waste processors have spent the last decade cutting their own path to profitability. In the beginning, companies processed green waste and wood waste to supplement their revenues. But, as many states diminished the amount of material that could be landfilled or even banned it from local sites, the market began to mature. As a result, in the past few years there has been significant growth in green and wood waste recycling. Additionally, the public has become more environmentally conscious, looking for recycled products to purchase.
Landfill Bans "In the late 1980s and early 1990s green waste and wood waste processing became a way to reduce landfilling," says Jack Hoeck, vice president of production for Rexius Forest By-Products Inc., Eugene, Ore. "In the past 10 years we have seen huge growth across the United States. Additionally, there was large growth in the private sector. We went from more municipal facilities to more private ones. We're seeing a maturity in the industry now."
According to Hoeck, there are approximately 3,500 yard waste processing facilities in the United States. Ten years ago, only 20 percent of those existed. Yet while processors are blessed with generous amounts of raw materials and strong end-user markets, success is not guaranteed.
For example, Cleveland's Kurtz Bros. Inc., has faced challenges since state lawmakers reversed a ban on landfill yard waste, according to Tom Kurtz. In the late 1980s, Ohio banned yard waste from landfills, creating new market opportunities for green and wood waste processing. Unfortunately, that legislation was rescinded about five years ago.
Now, end-product markets are good, but tip fee revenues for processors are down, he says. "Solid waste tipping fees are as low right now as they have been," Kurtz says, noting that fees have dropped from $40 per ton to $50 per ton in the 1990s to $30 per ton today.
Kurtz Bros. began processing green and wood waste when the Ohio ban was legislated. Prior to that, the family business operated a commercial top soil business for three decades. "We saw [the green and wood waste business] as a nice complement," Kurtz says. Building its business gradually, the family now operates 12 yard waste compost facilities in Cleveland, Akron, Columbus and Toledo, Ohio. Four of the facilities include separate wood waste processing areas. The company also operates two construction demolition landfills, four garden center retail stores, an industrial waste recycling business, a biosolids compost facility for the city of Akron and other waste-related businesses.
Kurtz Bros.' processing facilities take in yard waste, including brush, branches and leaves, and wood waste, including pallets, crates, and other unpainted or untreated wood. More than half a million cubic yards of yard waste passes through the facilities each year. But with increasing costs for labor, insurance, equipment and fuel, as well as inadequate tip rates, Kurtz says his company's saving grace is the end-markets for his soil amendments, compost and mulch, including color-enhanced mulch products.
"Those are becoming very popular," Kurtz says. "We sell about 250,000 cubic yards per year of it. If we didn't have good end-markets, we wouldn't be able to survive."
Grinding Mount Ugly David J. Leach, president of Deadwood Grinding and Recycling, Prattville, Ala., is familiar with the new challenges green and wood waste processors face. Since starting his business in 1993, he has faced increased competition from new players in the market.
When Leach started his business he was unfamiliar with the power of a tub grinder. In fact, the most experience Leach had with waste industry equipment was refurbishing and reselling it in his used equipment business. However, one of his customers handled storm cleanup for various cities and got Leach interested in reselling grinding equipment.
"[Eventually] we bought some equipment of our own and began calling on paper mills and grinding their wood waste," Leach says. Then, Deadwood was hired to grind wood waste for International Paper, Mobile, Ala.
"They had a waste pile they called Mount Ugly," Leach says. "We thought there'd be no end to it." Six months later Mount Ugly was processed, and Leach's new fledgling business was blossoming. One job led to another, and the business soon grew from handling 35 to 40 jobs per year to handling 100 to 125 per year.
But as more machines and processors have entered the business to compete with Deadwood, Leach says he's had to go "out on the road to get business."
"When we started in this business, it was really new," Leach says. "People didn't know what the equipment was or what we could do for them. Now, there's more competition and a lot more machines on the market."
Moving to the Market Traveling across Florida, Georgia, Alabama, Louisiana and Mississippi, Deadwood now uses grinders manufactured by Morbark Industries Inc., Winn, Mich., and Bandit Industries Inc., Remus, Mich., to reduce wood waste for lumber yards, paper mills and building contractors. Once material is ground, Leach says he contracts with a hauler to dispose or market the product.
"We prefer to leave the material on the ground. However, occasionally we have to sell it or dispose of it ourselves," he says. "We've been at this long enough that we know haulers in the different areas where we have contracts. There is work out there if you go out and get it."
Despite the challenges, today's processors say success can be found. "We will see some growth, but not at the pace we've seen," Rexius' Hoeck says. "Ten years from now the industry probably will see only about a 15 percent increase in the number of facilities."
That being the case, a successful future will depend on developing niche markets for end-products, knowing how to market the products, and educating and working with consumers. "The industry knows how processing works, what to do to reduce odors and how to market the products," Hoeck notes. "The future will be in finding more market applications and exploring niche markets."
Finding Your Niche Rexius Forest By-Products, which has been in the wood waste processing business for more than 50 years, originally accepted sawdust waste from sawmills to produce fuel for industrial heaters. "These byproducts commonly were used as a fuel source," Hoeck says. Then, as environmental regulations became more stringent, the company entered the landscape supply business.
Today, Rexius has a 20-acre facility to process, finish, and bag green and wood waste for retailers. At one end of its paved site is a green waste tipping area. Fees are based on volume. Using a Peterson Pacific grinder, two portable screens, a stationary screen for mulch production and a machine to color wood, Rexius produces compost, top soil and rock products for retail sale in northern California, Washington and Oregon. Additionally, the company markets through two retail outlets in Eugene and Springfield, Ore., regional chain stores and directly to consumers. Approximately 15 percent of Rexius' processed wood waste still is used for fuel.
When developing markets, Hoeck says they aimed at nurseries and customers who wanted an erosion control and landscaping product. For example, certain growers look for compost or top soil that resist disease, and mulch coverings that suppress weeds and retain moisture, he says. "The environmental benefits of these types of niche products are great. As there are more restrictions on chemical use, some types of compost can help customers use less pesticides."
Rexius also found a market for applying material using blower trucks that it builds and sells. "Wood waste and green waste processing is moving into a service industry," Hoeck adds. "Compost, mulch and soil can be applied so much more efficiently and conveniently. We can even do things such as adding seed into the soil and applying it."
The trick to Rexius finding its specialty was producing what the market needed while keeping an eye on costs, Hoeck says. "It's processing these materials and making these end-products - not just because we can produce them - but because they add value to some market."
Providing Value Similarly, Lane Forest Products, Eugene, Ore., tries to provide value for its customers by building blower trucks that apply its products. According to Orin Posner, president, the company has been grinding wood waste since 1994. Also a garbage hauler, approximately 25 percent of Lane Forest's business is wood and green waste processing.
At its 18-acre facility, Lane Forest processes the material with primarily stationary grinders, then markets it wholesale and retail. Wood waste goes to local particleboard, hardboard and medium fiberboard plants while green waste is processed for compost and sold through the company's landscape supply business. The landscape supply business, which has been in operation since 1985, provides the largest part of the company's revenues.
"We already were selling landscape supplies when the recycling requirements became stricter," Posner says. "We saw it as an opportunity for our business."
Currently, the company has 2 acres with bins containing 30 to 40 landscape products, including soil made from processed green waste, manure and sand, and mulch. But raw materials aren't a problem. "We are in an area where there are a lot of wood products manufacturers," he says. "It's different from a place like Florida where most of what you're processing may be urban wood or green waste. Here, if we never had any residential green waste, we'd be fine."
Every Saturday, from March through August, the company sells about $5,000 to $10,000 in material to homeowners. In addition, Posner charges $2 per cubic yard for homeowners to dump their yard waste. "It's very seasonal," he says, noting that in the winter, homeowners bring Christmas trees; in the spring, green and wood waste comes from storm damage; and leaves constitute the bulk of materials in the fall.
By using its custom-built trucks that can blow material up to 300 feet, Lane Forest can apply 30 yards to 40 yards of processed wood or landscaping soil per hour, Posner says. "Applying the product is something that other companies don't do," he says. "It's an added value. We can apply material to the fourth floor of a building from the ground using our blower trucks." The blowers also are used for erosion control projects and compost applications.
A Neighborhood Friend The city of Council Bluffs, Iowa, is another example of how a processor can become a valuable member of the community. When the city opened its recycling center in 1997, it also included a place for hazardous materials disposal - everything from paint to waste oil, according to Glen Ingham, solid waste management supervisor for the city's department of public health. However, the 12.9-acre site also processes yard waste, tree debris and construction debris, which allows the city to reduce its tab at the Douglas County, Neb., landfill.
Neighbors are bullish on the recycling facility because it has been available during at least two emergencies. In October 1997, one month after the recycling center opened, the city endured a ferocious winter storm that dropped 13 inches of snow and knocked out about 50 percent of the city's trees. The first Saturday after the storm, 2,046 vehicles unloaded damaged tree limbs and trunks at the facility free of charge, Ingham says. By the end of November, the recycling center still was averaging 400 trucks per day, each bringing an average of 1 ton to 2 tons of storm debris.
In August 1999, when a storm flooded a portion of the city, the facility again waived its tipping fees. "We were able to take a lot of the debris right away," Ingham says. "We set up a makeshift transfer station on our construction debris site to separate the waste, and we probably took in more than 900 tons in one weekend." The generous acts were especially helpful because the closest landfill is 22.5 miles away, Ingham says. "That's quite a drive."
To process incoming material, Ingham says Council Bluff's facility includes a 150-square-foot construction debris area where lumber is separated from metal then ground into mulch. The center only accepts yard waste that is brought directly to the facility by residents. "We have curbside pickup by BFI [Browning-Ferris Industries, Houston]," Ingham says. "That yard waste is then taken to a private company where it is processed into compost."
Tree debris is ground into fine or course ground wood mulch. The center charges a tip fee for unloading. For residents, course mulch is given away for free. Fine ground wood mulch is sold for $30 per ton to residents, landscaping companies or nurseries. Yard waste processed at the Council Bluffs recycling center is composted and used for city buildings.
In 1999, the recycling center processed approximately 3,015 tons of tree debris and approximately 240 tons of yard waste. Fine ground mulch sales in 1999 reached about $10,000, Ingham says. The majority of the course mulch was sent to feedlots and used as bedding for cattle.
"The mulch absorbs the animals' waste, providing a dry place for them to stand," Ingham says. "It also keeps the waste from leaching into the ground. As the waste drops onto the mulch, it also produces heat so that in cold weather the cattle aren't as cold. Also, cattle often eat some of the green out of the mulch."
Another benefit from the cattle using the mulch is that carbon mixes with nitrogen in the animal waste to create a fertilizer. Because Iowa has a healthy cattle industry, there is a ready market for the mulch, Ingham says.
While some might think such mulch producing may detract from the community, Ingham says his facility's aesthetics are important, and efforts are made to keep disruptions in check. To prevent debris from littering the neighboring communities, the local Boy Scouts of America troupe helped the facility build a berm where a number of trees were planted.
"With the construction debris, the wind becomes a problem," Ingham says. "Sometimes we lose paper or other light materials that are mixed in with the construction waste. We are hoping the trees will serve as a barrier to catch some of the paper before it hits our fence line.
"When we first proposed [the facility], we had a lot of neighbors try to block it," he continues. "They thought there would be a smell from the compost or debris flying around, but we've done a good job keeping our appearance up. Now the neighbors are our best advocates."
To further its business, Ingham says he hopes to educate people who are unfamiliar with the facility. "A lot of our residents know we're here, but they all don't," he says. "Some of the businesses and residents still are using illegal tree dumping sites because they don't know they have an alternative."
Additionally, Ingham says the center may purchase equipment to color its mulch. "That might help us to be more profitable in the landscaping mulch area," he says. "A lot of our competitors are coloring their mulch now and we may need to start doing that as well."
An Eye on What's Important Key to success is knowing what to focus on, according to Jeff Thompson, vice president of production for Wood Recycle and Compost Center, Wichita, Kan., who notes he concentrates on people and equipment. When the company began refurbishing pallets in 1994, Wood Recycle bought a small tub grinder to grind the wood scrap into mulch. The company also accepted waste from local tree trimmers and wood waste haulers at a tipping fee lower than the county landfill's. Soon, the company started creating custom green waste, operating a mobile grinder for a number of municipalities, including towns in southern Nebraska, Missouri and Kentucky.
With the success of its traveling operation, Wood Recycle decided to concentrate its efforts on the wood recycling and mulch business. In 1997, the company purchased 70 acres on the north side of Wichita to make room for both its pallet and recycling divisions. Then, finding end-markets - not attracting incoming material - became the primary issue.
To build the business, Thompson began separating incoming material - green waste, pallet scrap, waste grain from a grain elevator, oak debris from a cabinet maker and cedar debris from a lawn furniture manufacturer - to produce different types and sizes of wood mulch. Recognizing that approximately 85 percent of its compost and mulch is sold to commercial markets versus 15 percent to residents, Wood Recycle uses a combination of screens to produce up to 12 different fine- or medium-ground mulch products, Thompson says.
Ever watchful of his operations, Thompson notes he and 50 employees keep daily logs on maintenance and production so that the company knows its costs per cubic yard or per hour.
Maintenance is key, he says. While the facility runs 10-hour days, the machines grind for only seven or eight hours. The other two to three hours are used for preventive maintenance.
This attention to detail paid off when the company took part in grinding storm debris after deadly tornadoes devastated Oklahoma City and the south side of Wichita in May 1999. For 20 days straight, the company processed 25,000 cubic yards of storm debris, Thompson says.
When Wood Recycle's business increases, the company also will be ready. In October 2001, the county-operated landfill is expected to close, and Browning-Ferris Industries and Waste Management Inc., Houston, are set to open transfer stations in the area. "We anticipate more feedstock coming into the facility and maybe having to expand," Thompson says. "Everyone is looking at recycling a little differently now. It has grown tenfold, and I don't doubt it's going to continue to grow." Nevertheless, with his eye on operations, Thompson says Wood Recycle is prepared.
Room to Grow Despite the maturing processing market, Land Recovery Inc., Seattle, continues to plan for growth. The company started with a landfill in 1977 and its composting operation started in 1988, says Jeff Gage, director of recycling services. In 1992, the company built the Pierce County Composting Facility, a covered structure with an aerated floor that uses a Scat turner to produce up to 80 tons per day (tpd).
Last year, the company completed construction of a new facility with a capacity of 250 tpd next to its landfill, which recently closed.
Called The Compost Factory, the facility processes food waste, manure, green waste and wood waste. "We power the facility using landfill gas," Gage says.
Currently, Land Recovery is processing 170 tpd at The Compost Factory, including 95 percent yard and wood waste, and about 5 percent food waste. Both facilities will stay open for now.
"Prices have gone up steadily in the area, although they are just now catching up to the prices in the Midwest and Northeast, which have been higher for the most part," Gage says. "Most of our markets are based on yard waste. We can't supply enough."