Quality increases in mixed paper

This time last year, a number of material recovery facilities (MRFs) reported a decline in the volume and quality of incoming material largely because of the impact of the coronavirus pandemic on commercial generation and labor, with fewer workers meaning MRF operators were able to pay less attention to details. Despite the ongoing pandemic and labor shortage, many MRFs are reporting a steady increase in material quality—an encouraging sign as typically the holiday season typically yields the opposite.

“Our whole industry is struggling with a shortage of employees ... you’re going to have a change because of that,” says Shannon Dwire, president of Millennium Recycling Inc., a single-stream MRF based in Sioux Falls, South Dakota. “People that are delivering sorted goods may not be sorted as well because they don’t have the sorting staff. The garbage haulers that deliver material, for example, have [a] shortage of drivers that are not able to kind of police loads like you would hope.

“The mills so far have been pretty good about it,” she adds. “I think everybody’s in the same boat … there’s a little give and take, and the mills are pretty forgiving, too, because they need the material.”

The holiday season brings an abundance of old corrugated containers (OCC) on top of the already high levels seen during the pandemic because of the bigger shift to online shopping, a MRF operator based in the Midwest says, but a steady return to the workplace has created a recent increase in mixed paper as well.

He says it's a welcome change after stay-at-home orders resulted in very little mixed paper generation, and the increase is bigger than many in the industry would have predicted at this point.

“We’re seeing a return to work, [more people] back to the office, thus the commercial sector is reaching prepandemic levels but still 20 or 30 percent below those levels,” he says. “It has been at 50 percent, [but] it’s slowly working its way back."

He adds, “We’re seeing an increase in generation more specifically from the commercial sector from big office buildings much more than we had speculated. It went off the cliff when the pandemic hit. That was a near-disaster for our recyclers who are predicated on commercial single-stream recovery.”

The use of advanced sorting technology has upped finished bale quality, but a second MRF operator in the Midwest says it’s still difficult to keep up, particularly with staffing shortages at so many facilities.

Although mixed paper generation has increased recently, it still has not fully recovered to prepandemic levels, and the MRF operator says that with less mixed paper currently in the stream than in years past, the decreased quality becomes more noticeable. “With people, which are a very tough commodity right now, we average about 2 percent contamination. That standard really is tightening up.”

The increased supply of mixed paper has resulted in a continued decline in price, and a mill buyer based in the South says it’s resulted in overbuying because buyers “can just about name their price.”

“It’s now a buyer’s market,” she says. “[The supply is] out there. … Pricing is coming down. Premiums are coming down. When you get at capacity, you have no space to bring tons in. When the market gets sloppy like it is today, will I tend to overbuy because I can get it cheaper? That’ll tend to happen.

“It’s kind of like going to the store and seeing something on sale and buying it whether you need it or not," she adds. "You hate to turn it down. That’s what happens in this kind of market.”

But the higher mixed paper quality and increased generation have given many in the industry some hope for more market stability in 2022.

The second MRF operator based in the Midwest says, “It’s been a rollercoaster these last three years. Coming from some of our lowest of lows, charging customers to bring recycling in. … We’re seeing our highest of highs in a short time period, some market correction this last month or two. I think everyone would love to see a steady market that’s sustainable for recyclers. Recycling costs a lot of money, but we can do it economically.”