Page last updated at 15:39 GMT, Wednesday, 21 January 2009

The rising costs of recycling paper

By Tom Warren
BBC News

Piles of recycled paper
Piles of recycled paper built up last year as the market slumped

Piles of unwanted recycled paper built up at sites around England at the end of last year as the market for the product collapsed.

Firms say it is slowly recovering, but what is the true cost of keeping our old newspapers, envelopes and magazines out of landfill?

At warehouses around the country giant stacks of recycled paper were piled high at the end of 2008 as the global downturn led to a slump in demand.

Much of our "mixed" paper - which could be contaminated with other materials - is shipped to China and the Far East to be recycled in giant mills.

I think we will have to look at all manner of scenarios. We may need to look at incineration of paper
LGA spokesman

But this market suddenly dried up in November and December as China's economy slowed.

It highlighted the UK's reliance on overseas markets to sort out much of its old paper.

Last September, when recycling prices peaked, a tonne of mixed paper fetched between 65 and 75. But today that has fallen to just 15.

Paper that has been separated and is not contaminated peaked at between 90 to 115 a tonne. Now it is worth about 40.

It could mean problems for any councils which have based budgets on the higher prices.

Neil Clarke, managing director of Recycling UK Ltd, believes it is tax payers who will ultimately pay the bill for the increasing costs of recycling.

"It's going to cost one way or another. If it's a large blue-chip company it's going to cost them more for that waste to be recycled and the same for householders," he said.

"Unless the local authorities have fixed contracts they will be getting less per tonne for paper and magazines. The council tax payer is going to have to pay for it really."

'Too slow'

Mr Clarke said he did not think the price per-tonne of recycled paper would rise significantly over the coming months.

And he said the UK had been too slow to open new mills capable of processing the paper, leading to a heavy reliance on foreign markets.

Neil Rippon, managing director of Greencycle, a firm which handles recycled materials from councils mainly in the north east and north west of England, agreed some authorities would have to find more funds.

Recyled paper
Paper that is properly separated fetches a higher price

He said councils which collected waste themselves and did not have fixed contracts with firms to take it off their hands could be affected.

However the overseas market for paper and other recycled materials is recovering, he added.

A spokesman for the Local Government Association (LGA) said in November a quarter of councils had had to find extra storage space for unwanted paper, plastic, glass and metal.

And the economic downturn could force authorities to look at alternative ways of dealing with recycled paper, he said.

"I think we will have to look at all manner of scenarios. We may need to look at incineration of paper.

"What councils want to avoid at all costs is sending [paper] to landfill."

The LGA believes there is too much reliance on overseas markets.

"The point that we have to ship our lower quality products abroad is a valid one. The recycling facilities in this country aren't up to scratch," the spokesman said.

Phillip Ward, of WRAP, a group which helps individuals, businesses and local authorities reduce waste and recycle more, said a growing world population meant demand for recycled paper would be strong in the long term.

"In the current market it is much easier to sell paper if it is of a good quality and not contaminated with other materials," he said.

"This partly depends on the effectiveness of our sorting facilities but also on the way in which materials are collected and the effort which is put into ensuring that consumers understand what they can put into recycling containers.

"Addressing these issues will help to ensure that we have long term markets for our paper."

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