Hundreds of thousands of customers in the Puget Sound area will be paying more for their waste and recycling services. It's all tied to new regulations from China - the biggest buyer of recycled paper.
Paper makes up most of the residential recycling load. But China’s new National Sword policy says "no thanks" to the paper U.S. consumers recycle because it's too dirty, contaminated with food or other non-recyclables.
The change is leaving the market flooded with giant bales of paper with nowhere to go.
At the West Seattle Recycling Center, they get the high-quality paper - excess newspapers and scrap from print shops.
They get a little bit of the types of paper an average consumer recycles, which ends up in bales called mixed waste paper.
“That’s the problem child,” said the owner of West Seattle Recycling, Jon Howe.
New standards from China that went into effect last month demand only a 0.5 percent contamination rate.
“That’s crazy strict,” Howe said.
It means the biggest buyer of paper is no longer buying.
“Before, 55 percent of the mixed paper, China was taking. So really they went from that to almost nothing. That shows you what a big market disruption that is,” said Michael May, a spokesperson for Bellevue Utilities.
Howe says because his paper is clean, he can still sell the “problem child,” or mixed waste paper. But major recycling facilities like Republic Services have been storing it, and as it deteriorated finally with no buyers, finally started asking cities for permission to trash it.
Bellevue gave the green light for Republic to toss out more than 1 million pounds of paper, after the April 20 collection.
“We gave them one-time permission to landfill that paper. That was done in concern for safety or public health hazard. They were stockpiling it and that was becoming unsustainable,” May said.
One possible destination for the paper that's now trash: Cedar Hills Regional Landfill in Maple Valley. The landfill says it’s still weighing whether to accept the deteriorating paper.
A spokesperson for Waste Management, John Chelminiak, tells KIRO7 it's not throwing away recycling yet.
But he says about 200,000 residential Waste Management customers are getting letters that say:
Because of uncontrollable market conditions, the cost to process the recyclables that we collect has risen rapidly following an announced ban by China of many recyclable materials and new unachievable quality requirements by the overseas markets. Due to the volatility and unpredictability of these impacts, rather than a permanent increase to recycling collection rates, we believe that a temporary surcharge is an appropriate mechanism for managing increased processing costs.
It means starting May 1, if the state approves it, customers in unincorporated King, Snohomish and Skagit counties will at least temporarily pay up to 76 cents more per month for Waste Management’s service. The request for increased rates is for 90 days.
Washington’s Utilities and Transportation Commission (UTC) says 53 regulated waste companies work with the state to handle trash and recycling in unincorporated counties in the state.
Spokesperson Kate Griffith said over the phone, that she expects all 53 companies to go to the state and talk about “commodity credits,” or rate hikes. It could impact a total of 760,000 customers.
At the West Seattle Recycling Center, Howe says his mixed waste paper was getting $80 a ton. Now the price for his clean mixed waste paper has plummeted by more than half.
But it's hitting the companies that process residential waste much harder.
The Washington Refuse and Recycling Association, which represents the solid waste and recycling industry, says companies are getting less than $5 per ton – operating at a loss. And Executive Director Brad Lovaas says some companies are even paying recipients, so someone will take the paper off their hands.
“Prices have dropped through the floor,” Lovaas said over the phone. “Paper is the single biggest item, the most valuable commodity we have. And we’re having to pay.”
Lovaas said before the new Chinese regulations, a ton of mixed waste paper was selling for about $75 a ton.
State, county, and city officials say they're working together to figure out the next best step.
May with Bellevue says Washington is just starting to see the impact of China’s new standards.
“There really was some uncertainty. It’s just not a Bellevue problem or Seattle problem, it's a West Coast problem. There isn't a place for that mixed paper to go,” he said.
Lovaas says some of the paper is going to other markets – like India, Vietnam, and Malaysia. But he says the demand is much smaller, and the shipping cost to get the paper there is higher.
“Ships don’t go there directly. The containers still have to go to China, after India or Vietnam – that container still has to go to China,” he said. “China is the world’s biggest manufacturer.”
Lovaas says companies have slowed the processing to try to keep contamination levels down. But it’s increasing their operating costs, while prices are at rock bottom – in some cases, literally below zero.
Government officials, Waste Management, landfills, all say you need to change how you recycle.
“Food contamination is a big deal when it comes to mixed paper. That’s a big deal,” May said. “Avoid wishful recycling.”
He says if you have any uncertainty if something can be recycled, don’t take the risk of contaminating a batch and just throw it out.
Food containers need to be empty, clean, and dry before they go into the blue recycling bin.
KIRO7 asked Seattle and Bellevue Utilities if customers might also see cost increases soon.
Andy Ryan with Seattle utilities said it’s unlikely because the companies are under decade-long contracts with set rates.
May said they have to be notified before any rate change and it needs to be approved, and the city has not fielded any requests.
Howe says part of the problem is the way residential recycling is set up now – where everything is thrown into one bin. It saves trips, but sacrifices quality.
“Over the years, contamination levels have gone up because of co-mingling. In the old days separate bins separated the items,” he said. “It’s causing problems. Volumes have gone up, but so has contamination.”
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