Paper Recycling Supplement--High Hopes

As the nation’s largest city and a global finance and banking center, New York offers an abundance of scrap paper that provides tonnage to dozens of competing recycling companies in the region.

For office grades, the borough of Manhattan offers block after block of office towers in the mid-town and Wall Street regions, while much of the space in between is occupied by retail and mixed-use buildings that generate significant amounts of old corrugated containers (OCC), mixed paper and other scrap paper grades.

Sending trucks into the streets of Manhattan as well as into New York’s other boroughs is how Metropolitan Paper Recycling, based in Brooklyn, procures the material that keeps its sorting and baling facility busy.

STARTING UP. John Bianco and his sons, John Jr., Eric and Greg, have pursued different career paths, but a common denominator has often been paper recycling.

Between the four of them, they have experience with various companies in the New York City area. All have served as truck route drivers and in other operations and management positions.

The Biancos pooled their collective experience together in 2000, when BFI merged into Allied Waste and the newly-combined company sold some of its recycling assets in the New York City area.

With just a few years under its belt, Metropolitan Paper Recycling is employing more than 120 people and using all of its 117,000-square-foot plant capacity to process between 12,000 and 15,000 tons per month of old news (ONP), old magazines (OMG), office paper and old corrugated containers (OCC), according to Greg.

Paper collected from accounts throughout New York makes its way into the plant, but one account in particular has been critical for Metropolitan Paper Recycling.

CITY SERVICE. "We get the bulk of our material from the city’s Department of Sanitation," notes Greg. Curbside material collected through a contract between the city of New York’s Department of Sanitation Curbside Recycling Program and Potential Industries, Wilmington, Calif., is brought to Metropolitan’s Brooklyn facility for sorting and baling before being brokered by Potential Industries, usually to the Asian paper mills for which it procures material.

Greg estimates that 40 percent of the tons that make their way into the Metropolitan facility stem from the contract. This material is heavy in ONP and OMG, with a sorting system installed by Sherbrooke OEM of Sherbrooke, Quebec, Canada, helping the plant produce clean grades for shipping.

Greg says Alain Brasseur and Bruce Cafasso of Sherbrooke have been an integral part of setting up the plant. They, along with Metropolitan plant manager Glen Murray, helped design and install the system.

Although the Department of Sanitation contract is the largest single source of paper, it is just one source of material among many. Another significant contract has Metropolitan Paper Recycling collecting material from a government contract serving four of New York’s five boroughs.

Additionally, the company’s crew of drivers and fleet of 35 trucks have multiple stops on the 18 daily routes they run throughout the New York City metropolitan area. "We service a healthy percentage of the major supermarkets in New York City and many smaller corner stores," says Greg

For its customers, the company will "place little vertical balers for smaller customers or supply larger balers and wire for larger customers," he remarks.

Another service Metropolitan Paper Recycling offers is trash pickup and disposal. "We’re collecting about 85 percent recyclable fiber and about 15 percent trash, but it’s a service we have to offer to protect our recycling interests," says Greg.

Recyclers in major cities throughout North America face the task of sending trucks into congested central business districts and down narrow back alleys in downtown areas. But nowhere is this task as daunting as it is in Manhattan.

"The bridge to Manhattan is about 5.5 miles from our plant, but during the daytime it can take you two hours to travel that distance," notes Greg. "In terms of servicing our Manhattan customers, if we can’t pick up from them in the middle of the night, it’s not worth doing. Most of our commercial routes pick up between 7 p.m. and 5 a.m.," he adds.

ON THE SELL SIDE. Once scrap paper is in hand at the Metropolitan Paper Recycling plant, there is certainty that it will find a home at a consuming destination.

In addition to the Potential Industries arrangement that sees municipally collected fiber head to export markets, Metropolitan Paper works closely with other buyers who provide homes for its secondary fiber. Often, the common denominator is exporting.

"China has changed our marketplace," says Greg. "Previously, we’ve always had to deal with hills and valleys, but now there is that consistent demand from East Asia." In addition to Potential Industries, Metropolitan moves a lot of material through the America Chung Nam Inc. (ACN) Jersey City office. The brokerage represents Nine Dragons Paper Industries of China.

Greg credits Scott Taylor of ACN with providing reliable brokerage service and consistent buying patterns.

Sweden-based brokerage CellMark AB is another buyer of Metropolitan’s tonnage. That company has praised the "consistently high-quality material" that it acquires from the Brooklyn plant.

"Jimmy Derrico has been a good part of the Metropolitan Paper Recycling story from day one," says Greg. "Jimmy has become a good friend and CellMark has become an integral part of our business growth," he adds.

According to Greg, the company markets 99 percent of its paper through its three key brokerage arrangements. The relationships with the brokers have resulted in long-term contracts, helping minimize potential disruptions caused by volatile pricing and inventory build-ups caused by disappearing demand.

SERVICE SECTOR. As do other successful recyclers, Greg tries to make sure he and Metropolitan Paper Recycling’s employees remember that only continued good service will keep the company on a profitable track.

The good service is possible in part because the recycling plant is equipped to handle the high volumes of fiber that come in, Greg notes. He credits the Sherbrooke OEM sorting system installed in 2004, a Harris Centurion baler installed this year and another high-volume baler made by IPS Balers Inc. that was installed in 2003 for providing a technological edge.

Employees who feel like their work is respected provide good service, Greg adds. "We remember our roots as drivers," he says of the company’s leadership team. "We respect our drivers as much as we would the president of our largest customer." The result, he claims: "We have very low employee turnover: Nobody quits. Just about everybody who has been in my office since we started in 2002 is still there."

They "built the company hiring people who can think on their feet," which also helps, Greg says.

As things now stand, Metropolitan Paper Recycling is on track to achieve triple the revenue in 2005 compared to its first year of operations, and Greg sees more growth ahead. "Our dispatchers and drivers put service first and customers first. That’s how we structured the company and that’s our signature here. New York is a huge marketplace, and we have a lot of options in terms of growth."

The author is editor of Recycling Today and can be reached at btaylor@gie.net.