As oil prices plummet, a surprising piece of the economy is taking a huge hit: the market for recycled plastic.
Plastics, after all, are made from petroleum — so as the price of oil drops, so does the cost of making new plastic bottles and other products.
In fact, as Marketplace reported in September, making new plastic has become less expensive than the recycling process, since cleaning and preparing used plastics takes a lot of water, energy, and effort.
The New York Times also reports that Waste Management — the country’s largest waste hauler — even shut down 20 facilities in 2014 and 2015, due in part to decreased demand and shrinking profit margins.
There are other factors that contributed to the decreasing value of recycling.
Early recycling programs had smaller bins, for example, and required consumers to sort their waste according to type. Now that single-stream recycling — that is, the big blue bin where you toss all your recyclables — is widespread in the US, tons of stuff that can’t be recycled gets tossed in with the things that should be by well-meaning recyclers.
This makes the sorting and cleaning process even more labor-intensive and costly.
What’s more, freshly produced plastics are more appealing to manufacturers than the recycled stuff because the chemical composition is easier to nail down — improperly mixed plastics can have issues, like rapid degradation or more limited uses.
It pretty much all boils down to this: The reason manufacturers liked buying recycled plastic was because it used to be cheaper than new, so-called “virgin plastic.” Now that it’s not, the US market has all but dried up.
That doesn’t mean we should stop recycling plastic, though.
For one, low oil prices won’t last forever. They could get a lot higher if the price tag on petroleum products adjusts to reflect their actual costs — without heavy government subsidies. And there’s at least some benefit to counteracting an economy based on the disposability of… well, almost everything.
Bill Nye may have said it best in an interview with Business Insider, pointing out that we should get in the habit of conserving resources, even if the economics seem not to work.
“The less we waste, the more we have,” he told BI.
Also, adding new plastic products to the mix without maximizing our use of the old ones means more plastic will collect in our waterways and get eaten by or ensnare wildlife.
There are probably better strategies to approach recycling, including clearer instructions for consumers and decoupling the recycling process from the profit motive.