But beyond the household gates recy-
cling plastic is big business. While most of our consumer plastic waste finds its way to China for recycling, most industrial plastic waste is processed here in New Zealand.
One of the key players in this area, Astron Plastics, is this year’s WestpacTrust Manukau Business supreme winner. Based in Manukau city, Astron has been recycling plastic for the last 13 years, and exports recycled plastic in pellet form to Australia, China and India.
It also has four recycling plants in Australia as well as plant and head office in Manukau and plant in Christchurch.
Small beginnings
Starting on small scale, Astron began as recycling unit for its parent company Chequer Corporation which makes flexible packaging in Auckland and Christchurch.
It produces products such as supermarket bags, retail bags and resealable bags where there’s lot of waste, off-cuts, or plastic left over in the process of making the bags. To use up that leftover plastic, Chequer started Astron Plastics, to reprocess it for reuse. “We granulate it, melt it down, filter it to take out any contaminants, and turn it into small pellets that are ready to be used again,” says Ken Johns, Auckland branch manager.
Soon, the company was approaching other plastic manufacturers to collect their leftover plastic, reprocess it, and send it back to them. These manufacturers range from injection moulders, blow moulders, and film manufacturers, says Johns, and they all have varying amounts of waste plastic. “Essentially we’re offering them service,” says Johns. The key to that service is making sure that one customer’s plastic doesn’t get mixed into another customer’s material, because they’re all different. Astron has developed tracking systems to ensure that this doesn’t happen.
Each customer uses an Astron container, which is periodically removed and taken to Astron’s recycling plant, where it’s processed into pellets, then returned to the manufacturer. Today about 95 percent of plastic manufacturers in New Zealand recycle their waste for reuse, Johns adds. Recycled plastic is around 50 to 70 percent the cost of raw material. With this kind of economics, Johns admits the recycling business is very competitive.
But the key to growth has been keeping close eye on key performance indicators he says. “Our monitoring systems are key to us.” Also, being competitive means looking for efficiencies throughout the value chain. “As suppliers to other manufacturers we have to think like them. Manufacturers are always looking to cut their own costs, and we can’t keep putting prices up to cover any increase that comes along. So the only way we can do that is by making ourselves more efficient to keep our prices down, and make it more attractive to buy from us,” says Johns.
Plastic wrappers
While Astron’s core business is recycling left-over industrial plastic, it also has second recycling operation. “We also collect plastic waste such as wrapping around pallets of building materials, pallets of food, or bottles etc.
“We have people who resource the plastic from around 350 sites in the region, from Albany to Hamilton.” This recycled plastic is processed into pellets and what can’t be sold locally is sent offshore. “Currently we’re exporting up to 160 tonnes month to Australia, which is then turned into products like building film, pipe or garbage bags,” says Johns.
“We compete very well in Australia because of the processes we’ve developed here.” These operational processes developed in New Zealand, have also been exported as models for their four plants in Australia. Today, these plants – two in Melbourne, and one in both Brisbane and Sydney perform the same service to Australian manufacturers of reprocessing waste plastic.
Fluctuations
The business is subject to fluctuations in the oil price. “At the moment it’s very competitive because the price is high. Plastic, being by-product from oil, means that plastic resin is more expensive just now, so there’s more people looking around for it,” says Johns.
He adds that lot of this plastic waste wrapping is exported as is, unprocessed, to places like China, where the cheaper labour costs mean they can reprocess it competitively. “So as processors it’s hard for us. But we’ve worked hard to have systems for good service, which is why we keep the bulk of our customers.”
Johns points out that the kind of plastic they deal with – recycled plastic is refashioned into range of products, none of which is in the health industry.
You’d be horrified to find your bread bag was made from recycled plastic – but it doesn’t matter that your garbage bag is made from recycled plastic.
