Council's recycling not affected by drop in scrap metal prices

THE drop in value of scrap metal has not affected the Timaru District Council's earnings from the recycling scheme.

After record highs in October, prices paid for steel, copper, aluminium and other metals plunged by up to 80 per cent with little warning.

The plunging prices had not affected the council's earning from the recycling scheme because it has a revenue-sharing arrangement in place with a guaranteed minimum sum for the first five years with the council's waste contractor Transpacific Industries (TPI).

Timaru District Council district services manager Ashley Harper is concerned about the fall in recycling revenue because when the agreement expires in two-and-a-half years it could mean a cut in the council's revenue.

Recyclables such as tins and cans are sorted and baled in the Material Recovery Facility at Redruth (MRF). They are then sold in the commercial market at the best possible price by TPI.

Mr Harper was unable to provide the earnings from the recycling scheme at the end of the financial year (March 31).

The council had no projected revenues because of the guaranteed minimum agreement and it is not projecting a loss for this financial year.

Mr Harper said the council applies its share of the revenue to reduce the contract sum payable to TPI, therefore the ratepayers of the kerbside collection service receive the benefits of the revenue from sales.

He understands that TPI apply their share of the revenue from the sale of recyclables to offset their costs of carrying out the contract work.

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