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How recycling quietly became a big business

11 September 2014

Transformation into essential activity sustains thousands of jobs.

Recycling has been transformed in the consumer’s eyes from a worthy environmentally-focused activity into a fully-fledged business sector that provides jobs for thousands and contributes significantly to the economy every year.

And yet, as John Hunt, MD of Mpact Recycling points out, recycling of paper waste started out with a simple business rationale. “It was a way for the paper industry to get raw material that was cheaper than using virgin fibre, largely from the forestry industry.”

“The additional benefits to the environment were there from the start. Putting waste paper and board into the manufacturing process meant we would need less virgin fibre and also save landfill space,” says Hunt

Mpact Recycling, part of the JSE-listed paper and plastics packaging group Mpact, now collects more than 450 000 tons of waste paper and cardboard a year. This is used by paper mills to manufacture new paper and cardboard packaging. Hunt says that recycling is now firmly recognised by government as an essential and job-creating beneficiation activity and is integral to the green economy.

“Recycling is unique in that it already enjoyed a strong positive reputation before it became a major sector that sustains businesses from the micro level up to large companies,” says Hunt.

However, he says the recycling sector needs further commitment if it is to continue translating positive feelings into activity that generates growth and jobs.

Explains Hunt: “It would be fair to say that pretty much everyone approves of recycling and that it is a good thing that should be supported. South Africans largely agree about the benefits of recycling and as such, South Africa has an overall paper recycling rate of 62%. This has improved over time, but clearly more can be done.”

“To boost recycling further it must be recognised as a strong and growing contributor to our economy. This is a significant business sector that supports about 100 000 jobs and is of considerable value to the economy,” says Hunt.

And uniquely among business sectors, the value of the contribution made by recycling can be measured in both economic and environmental terms, he argues.

“We start with individual pieces of material that have a cost of disposal, and by the time we’ve collected many tons of material it has a price per ton that can be charged as input material to factories using this waste as a raw material in their manufacturing processes,” says Hunt.

Mpact’s confidence in the future of recycled fibre was underlined earlier in 2014 when the company announced that it would invest R765-million in upgrading its Felixton Mill at Richards Bay. After the upgrade, this mill will use only recycled fibre in the production of new paper and board.

The company has also announced a major move into plastics recycling with plans for a R350-million state-of-the-art polyethylene terephthalate (PET) recycling plant to be built at Wadeville in Germiston. The plant is expected to be completed in the second half of next year.

The new plant will process about 29 000 tons of PET plastic bottles a year, generating 21 000 tons of new raw material directly from what was previously considered waste material that would have been sent to landfill sites. Collecting and processing 29 000 tons of PET bottles amounts to a saving of about 180 000 cubic metres of landfill space each year, the equivalent of 75 Olympic-size swimming pools.

Hunt says the value chain of recycling stretches from collections of recyclables, to sorting, baling, transporting and delivery to factories. At the same time material that would have gone to landfill sites is diverted, while there is also a net benefit in terms of reduced carbon emissions.

Hunt points out that there are already in place significant systems and infrastructure for the collection of recyclable material.

“Private companies such as Mpact as well as a number of local authorities run collection operations in addition to normal waste removal. But this infrastructure, especially the transport part, can be costly to keep going if there is not enough material available for recycling.”

“Every office and other place of business can boost recycling. There are a handful of basic guidelines for separating out different kinds of paper, plastic and so on. Beyond that, it’s easy to make recycling a small part of your day,” says Hunt.

Mpact has helped more than 40 entrepreneurs start recycling businesses. The company provides further support through buy-back centres that purchase material and has set up sorting and baling facilities that provide further work opportunities.

Mpact also initiated projects to develop collections in deep rural and township areas. Recent recycling collection initiatives include a buy-back centre set up in Empangeni and collections at a landfill site in Hluhluwe, both in the Zululand area. Other initiatives include establishment of buy-back centres in Mabopane and Soshanguve around Pretoria, Diepkloof in Soweto as well as Daveyton and Tsakane in Ekurhuleni.

“These initiatives are based on assisting local entrepreneurs to set up businesses and providing support for them through the provision of equipment and purchases of collected material,” says Hunt.

Source: MPACT