California Department of Resources Recycling and Recovery (CalRecycle) 

Beverage Container Recycling

2nd Quarter 2016 Processing Payments Adjustments

March 8, 2016

NOTICE

To: All Interested Parties

Subject: 2nd Quarter 2016 Processing Payments Adjustments

Section 14575 of the Public Resources Code (PRC) requires the Department of Resources Recycling and Recovery (CalRecycle) to establish a processing payment for any beverage container type that has a scrap value less than the cost of recycling. CalRecycle makes processing payments to processors. Processors pay recyclers the entire processing payment.
 
Pursuant to PRC Section 14575, the calculation of the 2016 processing payments is based on the difference between the scrap values offered to recyclers and the sum of the actual costs of recycling for certified recycling centers, excluding centers receiving handling fees, plus a reasonable financial return.
 
Processing Payment Adjustments: PRC 14575(f) gives CalRecycle the discretion to adjust the processing payment not more than every three months if CalRecycle has determined that the average scrap value for a specific beverage container material type for the most recent available twelve-month period directly preceding the quarter the processing payment is calculated is five percent more or less than the statewide average scrap value used as the basis for the processing payment currently in effect; and that adjusting the processing payment is necessary to further the objectives of the beverage container recycling program.
 
As the change in scrap values as described for Glass, #1 PET, and #2 HDPE are greater than five percent, CalRecycle has concluded it is appropriate to adjust the processing payments at this time.
 
Processing payments for bimetal and plastics #3 - #7 are not being adjusted as the scrap values for these container material types are highly volatile and based on small volumes. The changes in scrap values and adjusted processing payments for Glass, #1 PET, and #2 HDPE, effective April 1, 2016, are shown on the table on the next page.
 
Scrap values are based on the average scrap values paid to recyclers for the period between January 1, 2015 and December 31, 2015.

The processing payments shown below become effective April 1, 2016.

Change in Scrap Value Per Ton and Adjusted Processing Payments
Material Types Glass #1 PET #2 HDPE
Scrap Value Per Ton (Basis of Current Processing Payments) -$1.10 $273.45 $354.51
Scrap Value Per Ton (January 2015--December 2015 ) -$1.80 $241.04 $316.82
Percent Change 63.64% -11.85% -10.63%
Current Processing Payment/Ton
(Effective 1/1/16)
$101.07 $165.96 $183.01
Adjusted Processing Payment/Ton
(Effective 4/1/16)
$101.77 $198.37 $220.70
Current Processing Payment/Pound Redeemed
(Effective 1/1/16)
$0.05054 $0.08298 $0.09151
Adjusted Processing Payment/Pound Redeemed
(To be used on DR6, Effective 4/1/16)
$0.05089 $0.09919 $0.11035
Percent Change to Processing Payment/Pound
Redeemed
0.69% 19.53% 20.59%

Based on the current adjustment to the Glass, #1 PET, and #2 HDPE processing payment, CalRecycle would expend an estimated $6,947,486.

Estimated Processing Payment for Remaining Three Quarters
  Glass #1 PET #2 HDPE
Estimated Current PP Payout $63,930,853 $30,872,066 $2,419,634
Estimated Adjusted PP Payout $64,363,468 $36,888,161 $2,918,410
Difference (For Year) $432,615 $6,016,095 $498,776
Difference (For Remaining 3 Quarters) $324,461 $4,512,071 $374,0820

Table 1, attached, shows the following detailed information for glass, plastic and bimetal beverage containers:

  • The cost of recycling
  • The scrap value paid to recyclers
  • The processing payment (if any)

To review notices of changes impacting participants in the beverage container recycling program, please visit CalRecycle’s Beverage Container Recycling Program Official Notices page or call (916) 323-3836.

For further information on the determination of processing payments, please contact Hieu Le, Market Information Section at (916) 323-5778.

If you have any questions concerning processing payment reporting requirements or completion of the DR-6, please contact the Technical Assistance and  Review Section at (916) 323-3008.

Sincerely,

Scott Smithline
Director
 
Attachment: Table 1
2015 Processing Payments (Glass, Bimetal and Plastic)
Effective October 1, 2015 
Glass PET
Plastic
HDPE
Plastic
Vinyl
Plastic
LDPE
Plastic
PP
Plastic
PS
Plastic
Other
Plastic
Bimetal
Cost of Recycling per Ton with Reasonable Financial Return & COLA $99.97 $439.41 $537.52 $845.55 $1,206.25 $1,082.16 $670.31 $734.43 $677.40
Scrap Value per Ton -$1.80 $241.04 $316.82 $0.31 $26.61 $17.78 $107.55 $28.20 $53.37
Processing Payments to Recyclers
  Glass PET
Plastic
HDPE
Plastic
Vinyl
Plastic
LDPE
Plastic
PP
Plastic
PS
Plastic
Other
Plastic
Bimetal
Processing Payment Per Ton Redeemed $101.77 $198.37 $220.70 $845.24 $1,179.64 $1,064.38 $562.76 $706.23 $624.03
Processing Payment Per Pound Redeemed (To be used on DR-6) $0.05089 $0.09919 $0.11035 $0.42262 $0.58982 $0.53219 $0.28138 $0.35312 $0.31202

(PDF version)

Last updated: March 9, 2016
Beverage Container Recycling, http://www.calrecycle.ca.gov/BevContainer/
Contacts: http://www.calrecycle.ca.gov/BevContainer/Contacts.htm