PUHI — A decline in the price of scrap metal prompted Puhi Metals Recycling Center to start charging commercial haulers for dropping off their recyclables.
“For the last several years, the value of scrap metal has decreased globally. It’s pretty cyclical, and we’re usually able to bridge gap. But this time, it’s continuing to go down,” said Allen Evans, manager for the Resource Recovery Solutions location on Oahu. “We lost a considerable about of money on Kauai hoping it’d turn around, but it never did.”
Resource Recovery Solutions is the contractor to operate PMRC for the County of Kauai. Evans estimates the price of scrap metal has decreased about 65 percent since 2014.
According to marketrealist.com, an investment research and analytic website, in January 2014, the price of steel scrap metal was about $400 per metric ton. In January 2015, the price plunged to around $220.
It costs about $60 a ton to ship scrap metal from Kauai. But that doesn’t include labor, dock and other fees. With everything totaled, the cost per container can be over $300 a ton, said Ryan Evans, manager at the Resource Recovery Solutions location at PMRC.
Earlier this month, PMRC started charging businesses to drop off items like riding lawnmowers, refrigerator, golf carts, freezers, shopping carts and ice machines.
Before, it was free.
“Anything that is scrap metal comes here,” said Ryan Evans.
About 750 tons of scrap metal a month are shipped from Kauai, Allen Evans said.
“It costs us more to process and ship than what it’s worth,” he said. “So we had to make shifts to make it profitable.”
While PMRC is charging flat rates for commercial haulers, Allen Evans said he’s also working with the businesses to come up with a fair price.
“We’re pro-rating it as well, based on volumes. If a container is only half-full, we make it as fair as possible,” he said. “We’re not looking to make a million dollars.”
For example, dropping off a riding lawnmower costs $400 plus tax. A shopping cart costs $25 plus tax. A 40-foot container costs $500 plus tax.
Business hasn’t tapered off since the implementation of the charges, Ryan Evans said.
Diann Hartman, director of public relations for the Grand Hyatt Kauai Resort and Spa, said the resort uses Garden Isle Disposal to collect scrap metal from the hotel, which is then taken to PMRC.
“Though it will probably increase our disposal fees with Garden Isle Disposal as they pass the charge on to the end user, it will not deter our practice of recycling,” she said.
Allen Evans says the majority of scrap metal recyclables comes from residents, with between 35 and 40 percent coming from businesses.
“But we always had fees for certain items, like refrigerators. We had a $20 fee for things we have to do to process it, like draining oils, looking for PCB pipes and mercury switches,” he said. “Then we have to crush it, put it in cubes, load the cubes and take it to a boat.”
Residents will never be charged for services, Allen Evans added.