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Economic Components of Recycling
Obstacles to a Free Market
April 11, 2013
SERDC.org
SERDC Sponsor members
2
SERDC.org
Let’s ExploreMarket Obstacles
Why don’t our markets behave like we think they
should?
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Regional Collaboration = Increased Access to Markets
Summary of Region Wide Findings:• 206 manufacturers • 47,525 employees• $29.4 Billion sales revenue
SERDC.org
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What is recycling?
6
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Traditional Market Behavior
P
Q
S
D
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Negative Pricing
P
Q
S
D
0
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The Bottom Line
P
Q
S
D
Tipping fee
0
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What’s really happening: Inelastic Supply
P
Q
S D
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Super Inelastic Supply
P
Q
S D
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Market Volitility
P
Q
SD
PPI - Wastepaper
1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 20110.0
50.0
100.0
150.0
200.0
250.0
300.0
PP
I -
Bas
e d
ate
12/1
986
Aluminum UBCs
1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 20110.0
50.0
100.0
150.0
200.0
250.0
300.0
PPI Used Beverage Can Scrap
Year
PP
I -
12/1
989
Bas
e D
ate
Plastics
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How have Programs Responded?
Environmental concerns led to program creation.
Local governments are mission service driven, not profit motivated.
Capture Percentage Flat Lined
Daily Pounds per Person, recycled
Paper by Decade
UBCs by Decade
Plastic by Decade
Pounds per Capita
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Restraints
• Annual budget • Floor pricing in contracts– Risk vs Return
• Citizen participation• Inequitable access
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How do we move the needle?
P
Q
S D
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Possible Improvement
• Enterprise Funding• Contract Negotiations• Pay As You Throw• Cooperative Marketing• Extended Producer Responsibility• Hub and Spoke
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Increase RecyclingQualityQuantity
MethodsPolicy Practice
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SERDC Resources
www.serdc.org/regionalresources
• Economic Reports• State Recycling Resources• Market Directories• Waste Exchanges