1993/1994 Glass Market Profile August 1994

Solid Waste Department
600 NE Grand Ave.
Portland, OR 97232-2736
(503) 797-1650
Fax (503) 797-1795

Key Facts

Major Generators: Households, restaurants, retail and grocery stores, bottlers, window manufacturers, plate glass distributors and cutters, building construction, demolition and remodeling contractors.

Estimated Generation

70,135 tons of all types of glass(1)

[FOOTNOTE 1: Generation equals quantity recovered in Metro for secondary uses plus quantity disposed in Metro.]

Estimated Recovery

44,676 tons of all types of glass combined = 64 percent of all glass generated(2)

[FOOTNOTE 2: This is "post consumer waste" which is defined in Oregon statute as "a material that would normally be disposed of as a solid waste, having completed its life cycle as a consumer or manufacturing item."]

Manufacturers/Processors

Owens-Brockway, Potters Industries
East County Recycling.

Handlers

Container Recovery Inc. collects and preprocesses all glass beverage containers recovered through Metro-area retail stores under the "Bottle Bill." Virtually all buy back centers, depots and curbside programs accept container glass.

Origin of Recovered Material

Oregon and Washington.

Secondary uses

Beverage and food containers, glass beads used in highway striping paint, aggregate substitute, sand blasting grit, lightweight filler in plastics. These are established secondary uses. Alternative uses are being developed.

Location of End Markets

Oregon.

Market Value

Owens-Brockway pays $40/ton for clear container glass, $20/ton for brown container glass and $5/ton for green container glass. Potters accepts window glass at no charge. East County Recycling charges a variable rate for all types of glass depending on quantity and quality.

Major Factors Affecting Market Value

Oversupply of recovered container glass -- especially green -- relative to in-region demand for glass containers. Limited number of markets.

Other Factors Affecting Recovery

Highly successful "Bottle Bill" deposit return program. Unfavorable weight-to-value ratio that makes some long-haul transportation uneconomical.

Recovery Trend

High and stable

Outlook

Favorable

Overview

Recovery of glass containers continued to inch up in 1993 and the first half of 1994, but the price paid to collectors for green glass containers dropped from $10 per ton to $5 per ton due to the persistent oversupply of this material. While the oversupply of green continues to be a problem, demand for clear and brown glass outstrips supply. Demand for clear is up due to the growing fruit-flavored tea market and demand for brown has been increasing sharply due to the success of Northwest micro breweries.

The overall cullet utilization rate at the Owens-Brockway Portland glass plant through May 1994 was 63 percent, and the flow of recovered glass to the plant during this same period was up nine percent over the first five months of 1993.(3)

[FOOTNOTE 3: Recovered container glass used to make new containers is called cullet.]

With strong demand for clear and brown cullet, Owens has reduced its inventory of flint cullet about 30 percent and its amber about 50 percent since the beginning of 1994.

Estimated Tons of Glass Recovered from the Metro Area

A number of efforts to address the oversupply of green glass occurred during 1993-94. Owens negotiated favorable rail rates that enabled it to begin shipping some of the green surplus to its sister plants in northern California. Oregon Steel began using green glass from Owens in its steel-making process. Owens used 15 percent to 17 percent green cullet in manufacturing brown containers.

A study to evaluate the engineering characteristics of green glass as a construction aggregate was completed, as was a subsequent marketing research study to identify potential local users of recycled glass in non-container applications. Standards are being developed as part of an effort to facilitate trading of cullet on the Chicago Board of Trade. Research and development of a recycled glass roof tile under a Metro giant continued. Metro completed a demonstration project using green glass as a gravel substitute on a pathway in a public natural area.

Recovery of non-container glass also climbed in 1993-94 due to expanded processing capacity. East County Recycling (ECR) began accepting all forms of waste glass, including window glass and plumbing ceramics, for use in a recycled aggregate product.

In early 1994, recovery of refillable Henry Weinhard beer bottles was dealt a blow as some retail stores began using reverse vending machines at their Bottle Bill redemption centers. These machines crush the bottles for more efficient storage and transport, and thus make them impossible to refill.

Recycling Infrastructure

Container Glass

Glass containers fall into two categories: "Bottle Bill Material" and "Non-Bottle Bill Material."

All beer and soda bottles sold in Oregon are covered through the "Bottle Bill," Oregon's container deposit legislation. "Bottle Bill" material recovered through retail stores statewide is separated into three colors: clear, brown and green. In the Metro area, this material is collected, pre-processed and transported to the Owens-Brockway manufacturing plant by Container Recovery Inc. (CRInc.).

CRInc. provides this service to most Oregon retail stores outside the Metro area also. Henry Weinhard beer bottles are the exception to this process. About one quarter of Henry's bottles sold in the Metro area are returned via beer distributors to the Weinhard brewery in Portland to be washed and refilled.

Glass containers used to bottle wine, juices, condiments and other foods are not covered by the "Bottle Bill." This glass is recovered through buy back centers, depots and curbside collection programs. Most collectors in the Metro area market this material through buy back centers or transport it to the Owens plant themselves.

Window Glass

Potters Industries accepts clean loads of window and auto glass at its facility in Canby. Potters receives this material from local self haulers and its trucks additional material from outside the region.

Mixed Glass

ECR accepts all forms of waste glass -- including windows, containers, and ceramic plumbing fixtures -- at its facility in east Multnomah County. ECR receives mixed dry waste and source-separated loads from construction and demolition contractors, commercial garbage haulers and the general public. East County charges less to receive source-separated loads of glass than mixed loads. While there is a charge to use East County, it generally costs the waste generator less than landfilling.

Secondary Uses

Owens remelts color-sorted, recovered container glass with raw materials (sand, soda ash and limestone) to make new containers. Owens uses 50 percent to 80 percent post-consumer glass in its manufacturing process. Clear containers must be made with 95 percent clear cullet. Brown can be made using 15 percent to 20 percent clear and green cullet. Green can be made using up to 35 percent brown and 15 percent clear cullet.

Potters Industries mechanically crushes recovered window glass into beads that are added to pavement striping paint. These beads also are used for sandblasting and as a lightweight filler that strengthens plastics.

ECR crushes all forms of waste glass and blends them with crushed asphalt and concrete, recovered from construction and demolition sites, to make an aggregate product. Glass generally comprises about two percent to three percent of this product, but can make up to 10 percent of it.

Factors Affecting Glass Markets

Supply and Demand

Owens pays different prices for recovered container glass (or "cullet") because in-state demand for glass containers and the quantity of recovered cullet varies by color. Owens pays eight times more for clear cullet and four times more for brown than it does for green, for example. This is because the demand for clear and brown containers outstrips the supply of clear and brown cullet, which the situation for green is exactly the opposite.

Demand for flint continues to exceed supply by 13,000 tons, while demand for amber exceeds supply by 10,000 tons per year. As of June 1994, there were 6,500 tons of surplus green stockpiled at Owens. Supply exceeds demand by about 8,000 tons annually. The green oversupply is due to a combination of strong demand for imported products in green glass containers, and high recovery rates due to the "Bottle Bill." The only Oregon products currently packaged in green glass are Weinhard's Ale and Mickey Beer, and the "Bottle Bill" redemption rate is virtually 100 percent.

Distribution of Imported Green Glass Containers

47% of green glass containers sold in US market are imported. Source: Glass Packaging Institute (1992 data). The supply of window and plate glass flowing to Potters historically has been in line with its demand for this material. This has been due largely to the strict quality standards Potters has for incoming material. The supply of this material is slowly increasing, however, as waste glass generators are becoming more aggressive about avoiding high landfill costs.

Raw Material Prices

The prices of the raw materials used to make glass (sand, soda ash and limestone) are relatively stable and inexpensive. This has effectively created a ceiling on the market value of recovered container glass, since the only existing major market for this material is containers.

Unlike Owens, Potters Industries does not manufacture glass. Its primary input material is recycled glass so it does not face competition from virgin raw material.

ECR's aggregate product must be priced 20 percent to 25 percent below virgin aggregate to be competitive. Aggregate is a relatively abundant and inexpensive commodity in the Pacific Northwest.

Processing Costs

Before container glass is re-melted to make new containers, it must be stripped of contaminants -- especially ceramics, Pyrex and metals. It also must be crushed into small pieces that melt evenly with minimum energy input. Processes for removing unwanted metals and paper are automated at the state-of-the-art Owens plant in Portland. However, this plant does not have equipment to remove ceramic and Pyrex contaminants at this time.

Potters accepts only clean loads of window glass, so it has minimal contaminant processing cost associated with using this recovered material.

ECR's aggregate product is relatively insensitive to contaminants. Through its "dump-and-pick" process, ECR removes major contaminants such as wood and cardboard. Ferrous metals are removed during the crushing process. This product meets Oregon Department of Transportation gradation and soundness specifications for 3/4" crushed base rock.

Secondary Products

Glass containers compete primarily with containers made from other materials, such as plastic and aluminum. In recent years, glass containers have been losing market share to plastic containers nationally. In Oregon, however, the growing micro brewery and fruit-flavored tea markets are helping to maintain strong demand for brown and clear cullet.

The glass beads Potters produces are unique in the marketplace. However, the reflective pavement striping paint they are used to make competes with similar products that are made from different materials. These include rumble bumps, raised pavement markers, reflective tape and other traffic delineation media.

Again, ECR's aggregate product is essentially a commodity substitute whose price is set by the virgin commodity (aggregate) it replaces.

Outlook

Glass is expected to continue to be recycled at a high rate. Demand for clear and brown containers is growing, and development of alternative uses for surplus green cullet and non-container glass is progressing steadily. Strong demand for amber and clear may displace some green glass furnace time at Owens, but Owens is expected to continue to be a market for green and the price is expected to remain stable through 1994.

New equipment slated to be installed at the Owens plant in 1995 will improve its ability to accommodate ceramic and Pyrex contaminants. This "find-grind" process will crush recovered glass to the consistency of coarse sand, so that glass contaminants will go into solution for container manufacturing at standard temperatures.

There is pressure to expand the "Bottle Bill" and this could have a mixed impact on glass recycling. While recovery of carbonated beverage containers through the "Bottle Bill" is high, the glass industry historically has lost market share to plastic and aluminum packages in states that have deposit legislation. The recycling community appears to be divided on this issue, and the prospects for changes to the "Bottle Bill" are marginal.

Owens expects to continue to ship surplus green to its sister plants in California for the foreseeable future. Metro is talking to potential users of surplus green glass about alternative uses for this material. Development of a recycled glass roof tile continues to move forward. Several projects around the state are in place to demonstrate the use of glass as a construction aggregate. The Oregon Recycling Markets Development Council is poised to have an expanded role in glass market development statewide.

Potters Industries' demand for recovered window glass is expected to remain stable in 1994-95.

East County Recycling is expected to process an increasing quantity of window glass and plumbing fixtures. Demand for its recycled aggregate product is expected to increase as local sources of natural aggregate are depleted and this material has to be transported from outlying areas.


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Last Updated: November 9, 1995