Recycling business loses out to recession
May 1, 2009 at 4:02 pm
The global recession has had a huge effect on many industries, but one of the hardest hit has been the waste industry. Before the economic crisis, waste was a huge business. Thousands of tonnes of waste to be recycled were shipped off to China, and the UK recycling sector was booming. Now, demand has dropped massively, leading to a huge reduction in the value of waste, and businesses are starting to suffer.
The plight of recycling companies has just been made even more clear by the collapse of Greencycle, a recycling company based in Durham. The company experienced a huge drop in demand from its main customers abroad, and as a result was forced to try to renegotiate its contracts with the council, who rejected the new offer. Eventually the company has gone bust, and when it went into administration it owed £1 million to the banks and £1.2 million in taxes.
The council is now faced with the huge dilemma of what to do with all the rubbish. It cannot simply dump it into landfill, as this would incur hefty fines from the government, which has strict targets for the amount of material that is to be recycled. Its aim is to recycle 50% of all waste by 2020, but at the moment the figure is only 34%.
However, Durham County Council has promised that the material will still go to be recycled as it would have done originally, although there will be some delays expected. The Council has even announced that it is now hiring a large number of Greencycle employees.
However, in these uncertain times for the waste industry, the fear is that many more recycling companies are going to face a similar fate in the near future, so we can expect to hear more bad news soon.
Kingsnorth waste is a plastic recycling company in Kent and they cannot find enough material to recycle.
Times are hard but you have to make the most of it.