Recovery economics

Running a material recovery facility (MRF) comes with ongoing costs. Below are key running costs to consider, excluding infrastructure, administration, operations, and machinery purchases.

1. Collection costs

• Purchased plastic (if using a buy-back model).
• Transport rental costs (if hiring transport).
• Transport ownership costs – Fuel, spare parts, insurance, maintenance, and servicing.
• Transport labour – Driver and loader wages.
• Personal protective equipment (PPE) – For safety during collection.
• Weighing scales – To measure collected plastic.
• Receipt books – For financial tracking.

2. Primary processing costs (sorting & preparation)

• Sorting labour – Staff wages for sorting plastic by type and colour.
• PPE – Gloves, masks, safety boots, etc.
• Sorting tables & chairs – Equipment for sorting efficiency.
• Water – For cleaning and processing plastic.

3. Secondary processing costs (crushing, baling, agglomerating)

• Labour costs – Workers operating crushers, balers, and agglomerators.
• PPE – Protective gear for machine operators.
• Electricity – Powering processing machines.
• Water – For cooling and cleaning.
• Machinery spare parts – Replacement parts for breakdowns.
• Machinery consumables – Items like blades, gear oil, and lubricants.
• Packaging materials – Raffia sacks, binding wire, and straps for storing processed plastic.

4. Recycling costs

• Recycling labour – Wages for staff operating extrusion, injection, or sheet press machines.
• Electricity – Energy consumption for processing recycled plastic.
• Water – Used in washing and cooling.
• Machinery spare parts – To maintain production efficiency.
• Machinery consumables – Items like heating elements, lubricants, and filters.

Lowering your costs

Operating an MRF in a remote area can be expensive, but there are ways to lower costs per kilogram of recovered material.

• Increase team productivity: Provide training to improve skills and efficiency; invest in capacity building to strengthen team performance; use target incentives to motivate workers and improve output.
• Expand collection capacity: Reach new areas to increase material supply, such as other islands, new neighbourhoods, or nearby mainland towns.
• Invest in technology: Improve efficiency by introducing cost-saving equipment, such as trolleys to reduce manual carrying effort, conveyor belts to speed up sorting, and strapping machines to bundle processed materials more efficiently.

Knowing your market

Understanding market economics is crucial for ensuring that recovered and semi-processed materials can help sustain your organisation. Below are market insights specific to Kenya (based on past sales), but they may reflect broader market realities in other regions.

General market advice

• Know your prices: Research market rates to avoid being taken advantage of by dishonest buyers.
• Weigh and record all materials: Always weigh flakes and other materials before they leave your facility. If selling for the first time to a particular buyer, ensure you are present to verify their scales and their weighing process.
• Sort properly: Buyers reject mixed polymers, so proper sorting is essential. Many will request samples before committing to a larger purchase, so place greater emphasis on quality sorting.
• Crushed flakes vs. baled materials: Crushed flakes fetch a higher price than baled materials, but in some cases, baling is more cost-effective.
• Transport costs: One of the biggest expenses is sea and land transport. To save costs, try to use vehicles/boats that arrived with goods and would otherwise leave empty, as they may offer discounted rates.

Material-specific market insights

PET (Polyethylene terephthalate)

• Seasonal pricing: The best prices are between April and September, when European demand is higher due to the warmer weather. For this reason, it can be advantageous to stockpile if you have space and enough cash flow to sustain you.
• Demand by colour:
  • High demand: Clear, blue, navy blue.
  • Low demand: Brown, green, white, thermoform, and bright colours (orange, yellow, etc.).
  • Challenge: Lack of a market for lower-demand colours makes recycling difficult. While these should be regulated, we still collect all PET to help clean the environment in the hope of identifying a potential market (this is not always viable with profit-driven enterprises).
• Risk of PVC contamination:
  • PVC is harmful to PET recycling.
  • Some PVC labels and bottles look like PET, so only crush PET you are 100% sure of.
  • If unsure, baling PET is a safer option to avoid contamination.

PVC and PP-R (Polypropylene Random Copolymer)

• Sort PVC pipes by colour: Avoid mixing different colours in the same crushed batch.
• Separate PP-R pipes: These small green pipes should be crushed separately.
• Distinguishing PP-R from HDPE pipes:
  • Some HDPE pipes resemble PP-R pipes.
  • HDPE pipes often have a blue line running along them—this helps with identification.

PP (Polypropylene)

• Prices vary by colour: Black PP attracts the lowest price.
• Sorting challenges:
  • PP is often mixed with other polymers, making it harder to identify.
  • Use multiple tests to confirm it is PP before processing.