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Bottle deposit programs hurt the mart: execs

Keywords: Tags  Ball, Novelis, AMM Aluminum Summit, Brad Soultz, Jim Peterson, Megan Daum, aluminum, used beverage cans UBCs

NEW YORK — As the national debate over bottle deposit recycling programs heats up, aluminum can producers continue to push for alternative ways to incentivize used beverage container (UBC) recycling, according to several executives in a beverage and packaging panel discussion at AMM’s Aluminum Summit in New York.

"Deposits are a tax, and while the places they are in certainly drive a higher recycling rate, it makes volumes dip," said Jim Peterson, vice president of marketing and corporate affairs at Broomfield, Colo.-based Ball Corp., a leading producer of aluminum beverage containers. "Our perception, with our customers, is every 1-percent increase in cost is a 1-percent decrease in volume."

Peterson said that when major beverage companies, such as Coca-Cola Co. or PepsiCo Inc., raise prices, Ball will often see a corresponding dip in the volume of cans produced. "Anything that messes with the cycle becomes a little challenging," he said. "It does get tricky; we want the aluminum to get collected as much as the next person does. Deposits, to us, aren’t the answer because (they) impact our volumes, we think, directly."

"Deposits only cover beverage containers, which means it’s not a great recycling theory in the sense that it eliminates food and other containers," said Megan Daum, vice president of sustainability at the Can Manufacturers Institute, a Washington-based trade organization. "We want to create a culture of recycling, not just recycling a beverage container."

Other panelists said that offering point-of-sale recycling incentives isn’t necessarily the best way to create an effective recycling program.

"As the infrastructure in North America exists, there is an effective collection system for UBCs but it’s not at point-of-sale," said Brad Soultz, vice president, chief strategy and commercial officer, at Atlanta-based Novelis Inc. "I think that’s something the industry will continue to struggle with and look at."

Peterson said that domestic recycling numbers need to be improved and the process should be completed in a uniform manner that doesn’t have an adverse effect on production volumes. "At some level our industry is our harshest critic, because we know this aluminum is worth so much to the entire supply chain," he said. "We have more work to do and we as a supply chain have to get after it, but we need to be uniformed as an industry–telling our message to our consumers that we have a great story."

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