Catenation Inc. of Green Bay, Wis., has been quietly rebuilding its high density polyethylene and PET recycling operation. A small fire at the plant on Jan. 30 caused a cash crunch that forced a temporary shutdown on March 10.
Catenation President Randy Tess said the fire started when a small heater ignited in one area of the plant.
Water damage destroyed 40 percent of the company's extrusion equipment, but the rest of the facility was untouched, Tess said.
The equipment since has been replaced or repaired, but Tess said the company now is working out the financing to restart operations by July.
Tess would not disclose how much capital is required to restart, or which financing sources the company is using. However, he said the incident and subsequent closing reduced the company's cash flow by 60 percent.
This event abruptly halted the company's recovery from another misfortune: the economic downturn that recycling has seen during the last two years.
Tess said Catenation was looking forward to increased business that spilled over from Phillips Chemical Co.'s closing of its HDPE recycling business in 1998, and finally was starting to make its way back up to a sustainable level in sales.
It all boils down to bad timing, Tess said.
"In 1998 the prices were really depressed — plastic pricing in general was down," Tess said by telephone from his Green Bay office. "In 1999 cash flow was tight, but we were plugging along waiting for prices to return.
"January 2000 was a record month in sales, and Jan. 30 we had the fire."
With 74 employees, Catenation produces high-end pellets from post-consumer HDPE and PET.
The company placed 37th in Plastics News recent ranking of North American recyclers with an estimated sales last year of $11 million.
