WM to add three recycling facilities in North America in 2024: CEO

US-based waste collection company WM is on track to add three recycling facilities in new markets in North America in 2024, and to complete automation upgrades at 10 sites, said CEO Jim Fish Feb. 13 during a quarterly earnings call.

Automation will help increase WM recycling capacity by 1 million mt/year by 2026, vice president of recycling Brent Bell previously said during an Investor Day in April 2023.

Executives also referred to two new recycling projects in Canada that WM has awarded through a competitive process. Although details about the projects were not immediately clear, WM media relations later confirmed the Canada projects via email:

"WM has two recycling projects planned in Ontario, Canada. These are related to EPR [extended producer responsibility] and are a great example of how our investments in automation and technology differentiate us in the marketplace."

CFO Devina Rankin said expected returns were limited in 2024 for commodity sales, including post-consumer plastics such as polyethylene terephthalate and high-density polyethylene.

"They're pretty muted on a year-over-year basis," she said. "But as a reminder, commodity price expansion in the recycling line of business can have some margin compression because of a really high return on invested capital part of our brokerage business."

However, higher recycling commodity prices help provide downward pressure on margins, which WM has built into its 2024 outlook, she said.

WM assumes average pricing of $125/mt for blended recycled commodities (including paper, metal, glass and plastic) and $26/MMBtu for renewable natural gas for its financial outlook through 2026, Rankin said.

In late 2022, WM acquired controlling interest in Natura PCR (part of Avangard Innovative), which processes low-density polyethylene film into pellets. Natura PCR previously announced plans to build a new recycled resin plant in Indiana.

Platts last assessed prices for post-use LDPE A-grade (95/5) film bales at 17 cents/lb FOB Chicago on Feb. 13. Prices have remained within a narrow range of 15-18 cents/lb since late July 2023, amid lackluster yet steady demand both domestically and in export markets such as Southeast Asia.