As volumes and prices for recycled material fell along with the overall economy, Dennis Denton in January slashed his company's workforce nearly in half, cutting 16 jobs at Denton Plastics Inc. in Portland.
This is the first time in the history of Denton Plastics that we had to lay anybody off, he said of the firm, founded in 1983. The layoff left Denton with 20 people.
A global slowdown makes it tough to be a recycler these days. Consumer spending is down, so manufacturers are producing fewer goods and turning out less scrap. That drives down demand and price for commodity materials, from recycled cardboard to reclaimed scrap polyethylene.
Exports of scrap plastic have slipped in Asia, a region that accounts for about one-third of Denton Plastics' total output, which includes PE, polypropylene, polystyrene and ABS.
Ninety-five percent of the infrastructure of plastics recycling is dead in China, Denton said, adding that his firm, which sells to the largest reclaimers in China, has managed to retain its customer base there.
The outspoken Denton thinks resin prices got ridiculous and shot up way too high, just like barrels of oil. He calls the plunge late last year a correction. For 2009, he said, I think prices have hit bottom and they're going to creep upward as this nation and the world get back on their feet.
In March, thanks to stabilizing recycled plastic prices and an uptick in business, he brought five people back.
Now he wants to add more local jobs by starting a factory to recycle PET, gathered through Oregon's strong bottle-deposit law, into a finished product, PET sheet. Now, Denton buys bales of PET and exports them to China.
But to make it happen, he would first have to secure a guaranteed supply of PET bottles from the Oregon Beverage Recycling Cooperative, which includes beverage distributors. The same companies that deliver beverages to the stores take back returned plastic, aluminum and glass containers from nearly 3,000 retailers, then deliver them to six processing facilities around the state. The materials then are sold to recyclers around the country.
If he can secure a steady supply from OBRC, Denton said his company will buy machinery and start a plant to reprocess recycled PET into sheet. He said he has rounded up experts at building plants for PET recycling.
The same stuff that we're presently buying and sending to China, we want that material guaranteed that it can stay in Oregon and we can process it and create jobs in Oregon, he said.
OBRC President John Andersen said the co-op has had only very preliminary discussions with Denton. A guaranteed supply could be possible, he said in late March. But again, we just really have not spent any time in a detailed discussion about what it might look like and so forth.
Denton Plastics would seem to have an inside track to run a reprocessing plant. It's the largest plastics recycler in one of the greenest states in the U.S. Oregon was the first state to enact a bottle-deposit law, back in 1973. The volume of PET bottles has expanded greatly this year, since water bottles were added to the 5 cent deposit program Jan. 1. Water now joins other beverages like soft drinks and beer.
Oregonians always were able to set PET water bottles out for curbside collection. That generated a water bottle recycling rate of about 33 percent, but the other two-thirds got thrown away, said Peter Spendelow, solid waste specialist at the Oregon Department of Environmental Quality. Now DEQ estimates that recycling rate will double to 60 percent of water bottles, driven by the deposit.
Today, Denton Plastics claims to be Oregon's largest plastics recycler. Dennis Denton started his company as a material broker. I hired a couple of people and we opened a warehouse. We tried to get people to grind for us, but found there was nobody around that would grind. Nobody would pelletize, so we bought some used machinery, he said.
The company bought a pelletizing extruder in 1986. Two years later, it moved to a larger building. The big expansion came in 2006, when Denton moved into a new, $5.6 million, 65,000-square-foot plant with a rail spur.
The firm recycles about 3 million pounds of plastics a month, about 75 percent of it from commercial and industrial sources. The rest is post-consumer material. During a plant tour in late January, Denton showed off his firm's diversity. Containers of rejected drinking straws, scrap film, old milk crates and PE foam sit waiting to be reprocessed on giant shredders, balers and pelletizers.
A white, fluffy mountain of non-woven PP fabric sits out by the loading dock. The place is full of large balers and shredders. Late last year, Denton installed a large Colortronic blender, tied to an extruder with an underwater pelletizer. The blender can run up to eight ingredients.
We handle all the commodity resins and a lot of the engineering resins like nylon, glass-filled, Valox, acetal, Ultem, he said. We process like the virgin guys. ... We do a lot of things to make sure that our formulas are correct.
Recyclers in big cities such as Chicago or Los Angeles, can focus on a few materials, but in the Northwest, you have to handle a broad range, purchased from a wide geographical area, he said.
The company has expanded into rotational molding resin, buying a Powder King pulverizer to make powder from virgin resin.
The recessionary fallout of lower volumes of recycled plastic has prompted Denton to expand into a regional distributor of virgin plastics. He wants to become a one-stop shop, selling pellets to processors and taking their scrap and finished products.
If somebody's making flower pots of polyethylene or polypropylene, we'll recycle the flower pots once they've been used, he said.
Denton is active with the Society of Plastics Engineers' Plastics Environmental Division. He has strong thoughts on industry topics, like a nationwide bottle-deposit law (which he supports), and bringing back U.S. manufacturing that left for China.
We have to give favorable status to manufacturers here in the domestic world, not only just in plastics, but across the board. We have to do that, he said.