Taking the next step

Features - Cover Story

GDB International, New Brunswick, New Jersey, responds to China’s scrap import policies by expanding its plastics recycling capabilities.

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April 10, 2018
DeAnne Toto
Photos: Rob Lynch

Plastics have been core to GDB International’s business since its founding in 1993. However, the company, headquartered in New Brunswick, New Jersey, recently has taken steps to go from collecting, sorting and trading plastic film to recycling it into pellets. While the move was something that GDB International President Sunil Bagaria says the company had been considering for some time, China’s actions over the last year banning or severely restricting imports of recyclables prompted the company to take action.

Moved to action

Bagaria describes GDB International’s move to produce recycled pellets from the low-density polyethylene (LDPE), linear-low-density polyethylene (LLDPE) and high-density polyethylene (HDPE) plastic film it collects from industrial and commercial sources as the biggest decision the company has made in its 25-year history.

“We were thinking about it,” he says, adding that China’s ban on certain types of plastic scrap provided the push the company needed to commit to these plans.

“For too long we depended on shipping to China,” Bagaria says. “It was shortsighted on our part and on the part of the whole recycling industry.”

While GDB International did substantially increase the volume of recovered plastics it shipped to Malaysia, Indonesia, Thailand and Vietnam in the last year, describing 2016 volumes as “almost nonexistent,” the company decided it could create more value for its suppliers—largely grocery stores and retailers—by recycling plastic film in the U.S., Bagaria says.

“There is more value to be realized and shared,” he continues. “We will help them see that recycling can pay. It has to make economic sense; only then will the recycling story be successful.”

GDB International is approaching new generators to increase its supply base and provide them with a sustainable recycling solution, he says. It is the company’s goal to provide closed-loop recycling solutions to plastic scrap generators in the USA.

The company also will expand its workforce in New Brunswick to run its pelletizing operations, creating 25 new jobs at that location, Bagaria says.

He refers to the current situation surrounding plastics recycling as “a whole different ballgame.” Bagaria continues, “Earlier, as long as you could collect it and put it in a container, you considered it recycled.” But, because China is no longer welcoming much of this material, that is no longer the case.

With the advent of China’s ban on certain types of plastic scrap, he predicts, “Each country will be responsible for their own collection and recycling.” The only enduring solution to the situation China has created, Bagaria says, is developing domestic recycling and reprocessing capacity.

“For too long we depended on shipping to China. It was shortsighted on our part and on the part of the whole recycling industry.” – Sunil Bagaria, president, GDB International

Starting slowly

Of the plastics GDB International handles, 99 percent by volume are generated by postcommercial and postindustrial sources. Its plastics recycling business accounts for roughly 25 percent of the company’s annual turnover, Bagaria says, while plastics represent the largest volume material GDB International trades in.

Prior to starting up the first of its pelletizing lines, the company primarily was sorting, baling and shipping the plastic scrap it collected from postindustrial and postcommercial sources to domestic and overseas operations for processing into flake or pellets. “In a typical year,” he says, “we were shipping around 3,600 containers of plastic scrap overseas.”

GDB International still plans to ship some baled film as it ramps up production on its pelletizing lines, Bagaria says. However, he adds, the total number of containers of plastic bales the company ships annually will not be reduced as GDB International plans to increase its procurement and collection of plastic film to feed its own pelletizing lines and to supply to its existing customers.

The company’s New Brunswick plant measures 110,000 square feet. Approximately 60,000 square feet will be used for pellet production, which will be divided among four lines consisting of metal detectors, inline densifiers, vented extruders equipped with automatic screen changers and underwater pelletizers, Bagaria says.

The first line, which is purposefully small at a rated capacity of 1,300 pounds per hour, already is up and running, he says. The second, somewhat larger, line is being installed now and is expected to begin operation in June of this year. The third and fourth lines, each rated to produce 3,000 pounds per hour, will be installed at different times later this year, according to Bagaria.

“By the end of 2018, we should be making 2.2 million pounds of plastic pellets per month,” he says, adding that the company should reach full production by the early part of 2019.

GDB International is using the first line to get acquainted with the pellet production process, Bagaria says, and to ensure it has the right technical personnel and operators in place. “We are starting small and getting our people experienced in the art of recycling film into pellets.”

He says the company has encountered its share of difficulties with its first line, as expected. “The pellets are not as smooth as we would like,” Bagaria says. “It is all in the appearance.”

“By the end of 2018, we should be making 2.2 million pounds of plastic pellets per month.” – Sunil Bagaria, president, GDB International

GDB International is working to perfect its blend of film to yield the best results, mixing postindustrial material with postcommercial material from a total of four or five different generators. “That is the biggest challenge right now—developing a recipe that is consistent, so we don’t have to worry about the quality daily,” he says.

The expansion also allows Bagaria to put some of his knowledge from his master’s degree in polymer engineering to use in a new way. (His family in India has more than 35 years of history in the plastics industry.) He says his background already has been helpful in equipment selection, adding that he can ask more relevant questions when shopping for equipment for the extruding operation. “Knowing the technicalities of setting up an extrusion line allow me to bargain properly.”

Bagaria says his knowledge of polymer chemistry will help the company produce pellets of the necessary quality. In the future, GDB International may introduce additives during the recycling process; but for now, the company is concentrating on making commodity-grade pellets, he adds.

As of mid-March, the company was six weeks into operating its first line.

GDB International plans to sell its finished pellets to the domestic and export markets. It is targeting manufacturers of garbage bags and other plastic film products as well as the pipe and irrigation sectors. Bagaria says U.S. consumers of recycled plastics tend to be more exacting in terms of quality, while overseas consumers are more price conscious, though they are more tolerant of variations in quality.

Bagaria says he sees limited demand for recycled plastics as the biggest challenge his company and other plastics recyclers face. “Whether we create demand by legislation or advocacy, recycling will not increase without it,” he says. “Business takes the path of least resistance, which is to use virgin resin.”

Planning for additional growth

While plastics have been the primary focus for the company since it started, GDB International saw the value in handling a variety of materials for its customers early on, first adding paper and then paint. GDB International CEO Sanjeev Bagaria, Sunil’s brother, agreed to take the company’s first load of paint back in 1997, when he was visiting a warehouse looking for plastics.

From that first load in 1997, Bagaria says GDB International has evolved into a world leader in making recycled premium-quality paint in the U.S. “We carry an extensive inventory of over 2,000 items in latex, oil, stain, varnish, aerosols, solvents, deck paint, traffic paint, white wash, mist-tint, brushes and rollers, to name a few items,” he says.

The company’s entire paint collection and recycling operation occurs in its Nashville, Illinois, warehouse, which measures 750,000 square feet.

In addition to its foray into producing recycled plastic pellets, the company recently opened a 94,000-square-foot warehouse in Neenah, Wisconsin. While Bagaria says GDB has a large supplier base in the area, it was having trouble efficiently serving customers that generate less-than-truckload shipments. “To bring those shipments to our New Jersey or Ohio warehouses was not cost-effective,” he says, referencing the escalating freight costs that many recyclers have experienced in the last year. GDB International’s existing warehouses also were starting to reach capacity.

He says the Neenah warehouse allows the company to provide more “cost-effective and on-time” service to generators of primarily plastics and metals in Wisconsin and its vicinity.

GDB International also is looking to further its national footprint by establishing a warehouse in the Southeast U.S., Bagaria says. The company currently is eyeing Florida or Georgia as the possible location for its sixth warehouse.

But, first things first. “Right now, the pelletizing is our main focus,” he says. “All our resources and energies are focused there. We want to succeed for us and for the industry to encourage other people.”

GDB International will produce recycled plastic pellets from the postindustrial and postcommercial LDPE, LLDPE and HDPE film it collects.

While the last quarter of 2017 was challenging for GDB International in terms of plastic scrap trading, Bagaria says it also has been “a good time for our company.” He adds, “Without challenges, what is the good of being in business.”

Bagaria says GDB International always has believed in creating value for its suppliers where none existed previously and adheres to the mantra “Anything that has been done can be done better.” This is only possible, he adds, by continuously investing in GDB International’s people and infrastructure and by upgrading its resources.

Bagaria says GDB International measures its success not only by the strength of its financial bottom line but also by its social and environmental impacts. He attributes the company’s success in these areas to its employees, who have made the company their second home.

Regarding GDB International’s foray into PE pellet production, Bagaria says, “We are very hopeful and confident that this is a good direction that we chose to take. It will bear fruit for us and for the industry. It solidifies our position with our suppliers: We will be there for them regardless of the market.”

The author is managing editor of Recycling Today and can be contacted via email at dtoto@gie.net.