With the increased focus on diversion of waste from landfill in Canada, more pressure will be placed on municipalities to recycle organics. In order to offset the added pick-up and processing costs of organics, it is important to develop markets for the final product. The “CORE” approach has proven successful in Australia and may also work in Canada.
While the collection and processing of recovered resources is now well developed in many urban areas of Canada, the marketing of some of these resources is limited. In particular, recycled organics from domestic and commercial sectors and some selected industry by-products are experiencing some difficulties.
Some people wrongly assume that because a material has been recycled it can displace or out-compete conventional non-recycled materials and products. Experience has shown that this achievement is much harder than anticipated, often leading to downward pressure on prices and over-stockpiling.
Another barrier to marketing recycled organics is that potential users are sometimes uncertain about the quality and performance of products and materials derived from recycled resources.
In Canada, there are several markets for recycled organics that are not developed. These markets include erosion control, remediation, rehabilitation and storm water or industrial runoff water treatment.
Also, certain agricultural markets have yet to benefit from the use of recycled organics for water/nutrient retention, weed suppression, soil health and plant health related benefits.
Traditionally, the role of market development has been left to relevant government departments or individual private re-processors and marketers. While this process has succeeded to varying degrees with “commodity” type recyclables such as paper, glass and metals, the same cannot be said for recycled organics. (See editorial, page 4, for a perspective on the municipal role in organics collection and processing.)
Many municipalities and private sector companies involved in organics recycling are operating outside their core business or have little experience at marketing into new or emerging markets. More sophisticated marketing techniques are required to maximize efficiencies and capitalize on opportunities.
In Australia, the use of a marketing network has proven very successful in developing markets for recycled organics. A marketing network consists of members with common goods and/or services and facilitators that assist in the development of new and existing markets for the members’ products. While individual re-processors and marketers often have limited resources for marketing campaigns, a marketing network can pool the resources of members to conduct more extensive and effective marketing and technical research programs for the benefit of the entire sector.
In Australia, it was found that a marketing network can often gain wider government support for marketing programs and can operate at an “industry to industry” level within a target market. This is particularly important in new and emerging markets where product or industry credibility may need to be established.
Established in 1997, Australia’s Centre for Organic and Resource Enterprises (“CORE”) was conceived to address the need for a dedicated recycled organics marketing network. At the time it formed, Australia had an estimated unrealized potential demand for recycled organics of around 350,000 tonnes.
CORE adopts a supply chain approach to market development and works closely at the supply end with “custodians” of the raw materials; these are primarily local government (and their contractors) and private sector generators such as agriculture and forestry. This process ensures that materials can be presented in a manner that meets both existing and new market needs.
CORE works closely with processors of recycled materials to produce products that can have higher market values in some markets. This can often improve the viability of some operations, particularly when existing markets are saturated.
The impact of this strategy has resulted in a change in the dynamics of managing biomass for local government and the community by shifting the emphasis on recycled materials from being a “waste” into a sought-after resource.
Benefits of a marketing network
The immediate benefit of CORE was that market demand for recycled organics increased. Around 500,000 cubic metres of demand have been created in the rehabilitation sector alone. Market research and foundation scientific research carried out by CORE into high performance stormwater treatment media containing recycled organics identifies a significant, high value product market. CORE is working in collaboration with the National Research Council of Canada, Biotechnology Research Institute to enhance the media’s biological treatment capability and add technology such as biosensors to further increase the range of stormwater treatment and reuse applications. The increased revenues from higher value products such as this media result in a reduced financial burden on municipalities responsible for processing organics.
Another benefit of CORE is that it targets new and emerging markets for products containing recycled materials. Instigation of demand-creation programs is facilitated through formal collaborations and supply chain linkages with end-market organizations. In many cases the use of products containing recycled organics in these markets has multiple environmental, social and resource preservation benefits superior to conventional practices that use non-renewable materials.
John Nicholson is a management consultant with Environmental Business Consultants based in Toronto, Ontario. E-mail John at email@example.com