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Muddled Shutdown at Coke Recycling Facility Keeps Suppliers Waiting

Despite statements otherwise made by Coca-Cola and United Resource Recovery Corp., recyclers have complained of balances unpaid since the March shutdown and layoff of all employees at the PET recycling center in Spartanburg, S.C. Payments outstanding range from tens of thousands of dollars, to $1 million for several hundred deliveries as far back as January 2011, Plasticnews.com reported.

The website reported on the lack of communication in addition to the delayed payments, a frustrating and debilitating situation for content suppliers, who take stock in earlier statements that the plant will resume operations this summer after the vaguely termed “restructuring” occurs. “Bad news is news. But no news is frustrating. When no one calls you back, it doesn’t do a thing but fuel the fires of anger,” commented one supplier. He said that NURRC is two months past due on the payment of $25,000 for two truckloads of material delivered in January prior to the March shutdown. Another supplier claims to have delivered 350 truckloads of material to NURRC and is now owed more than $1 million.

The plant, one of the world’s largest plastic bottle-to-bottle recycling complexes, opened in 2009 as a joint venture between Coca-Cola and United Resource Recovery Corp. The facility was built as a central tenet of Coca-Cola’s sustainability goals, not only in terms of the production capacity, but also in terms of the public relations campaign behind the partnership. The facility aimed to test a procedure for forming PET bottles from multiple sources, but there have been some issues with the end-product quality, Plasticnews said.

Coca-Cola maintains that the business of suppliers is wholly operated by URRC, according to Plasticnews.com, and the beverage giant remains committed to its recycling and recycled content efforts. “NURRC has a schedule of payments that they are working down as part of the restructuring,” said Scott Vitters, general manager of the PlantBottle packaging platform at Coca-Cola.

Carlos Gutierrez, president and CEO of URRC, said, “All I can tell you at this time is that suppliers are being paid.”

Speculation about the future of the joint venture includes the notion that Coca-Cola wants to move forward with its bottling that includes sugar cane fibers, the so-called “PlantBottles” introduced in 2009. One disgruntled executive told Plastic News, “This would be the perfect foil for them. They could have purposely done this so that they could say that can’t consistently get the quality they need,” and then make the transition to their plant-based PET bottles.

Worst-case scenarios tend to arise when unpaid invoices pile, but a manager at British recycler Closed Loop Recycling offered a different scenario. Chris Dow, managing director of the recycled PET and high density polyethylene recycler, told Plastic News that Gutierrez has been working with a German equipment manufacturer for six months and has developed a new piece of equipment that will dramatically clean up his recycling stream and improve his yields. Dow saw a video of the new equipment when Gutierrez made a presentation in Hamburg, Germany, in mid-April. “It is a brand-new type of machine that will have a spillover benefit to everyone in the industry, said Dow.

Vitters said that Coke is not abandoning NURRC, or its $50 million investment to date. “You’ve got a restructuring taking place and new equipment will be coming in. It will be there shortly. That hopefully will get it operating to where it needs to be to be sustainable and we will be able to ramp it up.”

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