SG Recycle shuts down paper recycling scheme amid financial pressures, low market prices

SINGAPORE – Local recycling company SG Recycle has announced it will discontinue its paper recycling program, just four years after its launch, citing funding constraints and persistently low paper prices.

The firm, which also handles textiles and e-waste, confirmed that its network of 84 smart paper collection bins across residential areas will be removed by the end of October.

Each bin reportedly costs around S$300 (US$232) per month to operate, a financial burden that became unsustainable without sponsorship.

In 2021, SG Recycle raised S$1.4 million in seed funding from Hong Kong-based Tai Hing to expand its smart bin network.

Despite the support, the business model struggled to stay afloat amid global commodity downturns. Founder and CEO Mervyn Ng said the company remains committed to advancing recycling solutions.

“We welcome opportunities to collaborate with like-minded partners to continue advancing Singapore’s and global recycling and sustainability goals,” he noted, adding that the smart bins would be warehoused for potential new uses.

The closure underscores a wider crisis in Singapore’s paper recycling sector. It comes just a year after the 34-year-old Tay Paper Recycling, once the country’s oldest paper recycling firm, shut its doors.

Informal collectors, known locally as karung guni, have also abandoned paper collection due to chronically low market prices, while rising export and collection costs have further eroded viability.

The Waste Management and Recycling Association of Singapore (WMRAS) recently urged operators to review their business models to remain sustainable.

Analysts say smaller firms are most vulnerable, while larger waste collectors are better positioned to absorb the costs.

SG Recycle said its paper recycling scheme was popular among residents, with bins collecting 220 tonnes of clean, high-quality recyclables in the first half of 2023.

Unlike the government-run blue bins, its system rewarded users with points redeemable for prizes, helping to reduce contamination rates, a longstanding issue in Singapore’s recycling system.

Despite ending its paper program, SG Recycle will continue collaborating with public waste collectors such as 800 Super and shift focus to exporting its smart recycling technologies, including reverse vending machines for deposit-return schemes.

The company’s solutions are already deployed in more than 15 countries across Asia, Europe, Africa, and the Americas.

Singapore’s recycling sector has faced mounting challenges. The latest figures released in July showed the domestic recycling rate at a historic low of 11%, with paper and cardboard recycling in long-term decline despite rising volumes from e-commerce packaging waste.

Lionel Dorai, Executive Director of Zero Waste SG, summed up the situation, “All recycling in Singapore is not doing well.

“There is supply, but low demand, because the cost to recycle is just too high. This is why smaller players are dying off while larger collectors do the heavy lifting.”

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