Future stakes: the year concluding was flat for most contractors and recyclers, but 2004 brings with it new hope - State Of The Industry

C&D Recycler, Nov-Dec, 2003 by William Turley

How was 2003 for C&D recyclers, and what will 2004 bring? We talked with dozens of recyclers across the U.S. to try to get a reading on how the industry did this year and what will happen in the market next year. Overall, most people reported a flat (at best) market, with a modicum of optimism for 2004.

For the concrete and asphalt recycling sector, a critical factor is pointed to By Valentin Tepordei, an analyst for the U.S. Geological Service, Reston, Va., Who has tracked natural aggregate production in the U.S. for many years.

He says 2002 production was less than 2001, and 2003 will be less than 2002. "State spending on highways is down, and they can't provide the matching funds needed to do highway work." The private sector, especially renovation, is doing better, he says, but that is not enough to make up for the shortfall in highways.

Tepordei tracks recycled concrete production by natural aggregate companies, admittedly a small part of the entire market. But he says that while 2003 tonnage will be down from 2002, he has noticed aggregate producers increasing the number of distribution centers handling recycled concrete.

Many governmental agencies are now looking coward mixed C&D materials to improve their recycling rates, according to Will Flower of Republic Services Inc., Fort Lauderdale, Fla. "Most have been doing consumer recyclables such as cans and bottles," he says. "C&D is an untapped market. A well-thought-out C&D recycling system can reduce waste going to a landfill and make money. However, it remains very market driven; no markets for the finished products, no money."

Flower thinks a slowing economy and reduced housing starts are the reason the number of C&D roll-offs coming in were down in 2003 compared to 2002. "We're not expecting an uptick in 2004," he adds. "There just were fewer projects. We hope 2004 will be better, but the waste industry is a lagging indicator of the economy."

Following are regional snapshots of din construction and demolition recycling markets.

NORTHEAST

Tadj Ondrick of Ted Ondrick Construction Co., Chicoppee, Mass., says the recycled concrete and asphalt market in New England is just where he predicted it would be. "The bad news is that his prediction wasn't favorable, and the market is down 35 percent from last year. "Government is into funding a war, not highways," says the 35-year veteran of the crushing industry. "Highway work is way off in Massachusetts because there is no funding. Same in Maine." He adds that Connecticut also is not doing well, Vermont asphalt recycling is down, but Rhode Island is not as bad, and New Hampshire is still booming.

Ondrick says he knows of at least a dozen piles of concrete or asphalt that need to be crushed at regular customers' sites, but they are putting it off until they need it for a specific order. "The economy is scaring people," he says. "Even Mrs. Housewife looking to do an overlay on her driveway is holding off because she is afraid her husband may get laid off."

Greg Wirsen of Green Seal Environmental, Sandwich, Mass., agrees that highway work took a teal hit in 2003, but says it was a good year for mixed C&D plant operators because there was a lot of development. Indeed, southeastern Massachusetts is one of the fastest growing areas in the country.

"We had a slow spring because of the weather, there was a lot of rain, but it really took off from May on," he says. 2004 may not be as good, only because such a high plateau has been reached.

In Maine Eric Higgins of L.R. Higgins, Inc., Scarborough, Maine, says material in take and tipping fees were basically flat in 2003. Wood markets fluctuated all year, but are going well lately. For 2004 he says he tries never to get too optimistic, but expects it to go well because construction and demolition activity in south Maine remains strong.

Down in New York City, Ray Kvedaras, Cooper Tank Transfer, says both the amount of material and tipping fees went up nominally in 2003, with 2004 looking about the same. The prices are tied into what the big waste companies do, he says.

MID-ATLANTIC

Skip Gardner, Patuxent Materials, Crofton, Md., reports that funding has dried up for roadwork in his area, leaving 2003 flat compared to 2002 for concrete recycling. "Maryland is in a budget crunch, and won't be out of it for a while," he says.

For that reason he sees 2004 staying the same. Getting material into the yards is no problem in the metro areas, but outlying areas have seen a slowdown in incoming concrete to be processed.

Concrete and asphalt recycling is going very well on the very cast side of Virginia, says Jimmy Sisson, Waterway Materials. "We can't fill the demand," he says. "We allow tipping for free and still can't get the material in to recycle." He estimates that demand is 150 percent of supply.

The reason for the imbed shortfall may be that on-site recycling is taking some of it and that the word isn't completely out on the streets about the free tipping, Sisson says.

Prices have remained firm for the final product, and the natural aggregate industry is trying to get a price hike going, which will only help recycled aggregates, says Sisson. For 2004, he expects the continued strong construction market will keep things looking rosy. "Municipal budgets are growing for infrastructure upgrades and maintenance because so much of our infrastructure here is old," he says.