MSW Solutions On Our Minds: Thoughts of Laurie Batchelder Adams

This year, SWANA is committed to getting MSW Solutions readers involved in the development of this newsletter, starting with what we hope will be a new section titled, "On Our Minds: Thoughts of SWANA Members." This month, SWANA Past-President Laurie Batchelder Adams discusses the recycling markets crisis.

Like any crisis, the recent plunge in recyclables markets forces us to ask some hard questions. The always-easier-said-than-done challenge, of course, is to ask the right questions and take the right actions; to find a way to use the crisis to improve the status quo rather than simply reacting - or worse, over-reacting.

For example, a natural tendency in times of economic stress is to narrow our focus to essential activities - and scale back on forward-looking planning activities. But does it really make sense - now of all times - to shut down the very process that visions and strategizes ways to increase efficiencies, diversify cost and revenue centers, and improve how we structure practices for managing our diversion programs? After all, planning activities rarely result in program changes tomorrow - these changes are usually months and years away. The longer we postpone these processes, the longer it will be until improvements become reality.

Speaking of practices for managing diversion programs:

• Should we count on recyclables revenues to balance our budget/maintain our cash flow? Or should we acknowledge that we’re playing a risk-based game where the “ups” are eventually followed by “downs” and maybe breaking even is the most we should hope for? The answer may depend on whether your organization has a long-term contract with fixed prices and a good performance bond to back it up.

• Should we pursue long-term market relationships or stick to a spot market approach? Are we ready to accept reasonable, competitive prices from buyers who want reliable, consistent product quality and quantity? Or is the allure of the high up-market prices we enjoyed a year ago too good to equalize in a long-term agreement?

• Will floor/ceiling prices or even quantity caps be the norm in future agreements? Should suppliers increase their ability for warehousing recyclables (and therefore the ability to speculate) in future years? If so - how much storage and what pricing are good enough to offset a downturn like this one? The editor of MSW Management magazine recently suggested that the industry consider formal sequestration (storage) of recyclables as a way to maintain supply, allowing domestic end markets to enjoy more stability and longevity. Would this work?

Please join this discussion by clicking on the comment button below. Also, consider joining SWANA’s recycled markets discussions at the Thinking Outside the Blue Box conference in Portland February 9-10. See www.thinkingoutsidethebluebox.org for more details.

Laurie Batchelder Adams
2009 SWANA Past-President


Interested in submitting an MSW Solutions guest editorial or becoming a SWANA blogger? Email marketing@swana.org with your opinions and thoughts or suggested articles. Become more than just a reader of MSW Solutions; become a contributor!