Low oil prices may come as a relief at the pump, but they’ve had a damaging effect on the waste and recycling industry. As oil prices continue to bounce along at their lowest levels in more than a decade, the cost of virgin materials has dropped below that of recycled materials, which is decreasing demand by manufacturers for recycled goods.
“The price of oil has dropped before, but this is a unique drop because it comes at a deflationary time in our economy,” says Joe Fusco, vice president of Rutland, Vt.-based Casella Waste Systems Inc. “We have seen the markets react to it, and several weeks ago Wall Street reacted to the drop of oil prices with a bit of a panic. This particular drop in oil prices is probably related to the fact that both the global and local economy is not as strong as we’ve seen in the past. It gives with one hand, but takes with another.”