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Big retailers are breaking California law and misleading consumers by selling plastic shopping bags bearing language and symbols that falsely suggest the bags can be recycled, a state-appointed commission alleged this month.
The group has asked California to force retailers to strip these bags of the ubiquitous “chasing arrows” logo and the words “recycle” and “recyclable,” Reuters has learned. If successful, that move could make the sacks ineligible for sale at checkout counters throughout America’s most populous state. The commission also is taking aim at padded envelopes and packaging materials used for home delivery, and plastic films on some grocery items.
In a Dec. 3 letter viewed by Reuters, the California Statewide Commission on Recycling Markets and Curbside Recycling asked the California attorney general and regulator CalRecycle to crack down on what it claims is illegal labeling that’s undermining the state’s efforts to tackle plastic pollution.
Fooled by recycling symbols, Californians mistakenly are tossing this material into curbside collection programs that don’t accept it, the commission said. That’s driving up costs for recycling companies to fish the stuff out of the waste stream and fix equipment jammed by these soft plastics.
The complaint did not single out any retailers by name. The California Grocers Association (CGA) said it does not believe current recycling labels on reusable bags are misleading. CGA spokesperson Nate Rose said the bags meet the law’s certification guidelines – including requirements that they be made of a minimum of 40% post-consumer recycled material and be durable enough to be used 125 times.
In an interview with Reuters, Heidi Sanborn, chair of the recycling commission, said it’s not surprising that Californians are confused.
“It is a Wild West of recycling labeling in California and there is no sheriff in town,” said Sanborn, founding director of the National Stewardship Action Council, which works to cut product waste. The 16-member commission is comprised of waste industry executives, environmental advocates and public officials. It is tasked with advising CalRecycle and providing recommendations for improving the state’s recycling system.
The commission’s complaint comes as California grapples with what critics say has become a loophole in the state’s 2017 ban on single-use shopping bags. That legislation, the first of its kind in the nation, came amid fierce opposition from the plastics industry, which spent nearly $6 million in a failed bid to stop it, according to state lobbying records.
A compromise provision in the measure allowed retailers to sell reusable plastic bags for a minimum of 10 cents each. The legislation also states the bags must be capable of being recycled in California.
It’s that provision that has the recycling commission clamoring for enforcement by the state. In practice, converting soft plastics such a shopping bags and packaging films into new products is so cost-prohibitive that recyclers say no market exists for this material. Thus, these items are not widely accepted in curbside recycling programs across California. For that reason, the commission says, they should not be labeled “recyclable.”
Similarly, the commission alleges that some retailers, amid rising public pressure to reduce waste, are deceiving consumers with language stating that their bags and plastic films can be returned to participating stores for recycling.
Four commission members told Reuters that retailers have not shown evidence that these programs are, in fact, recycling this material. In-store recycling bins, they said, tend to attract a jumble of trash that ends up in landfills.
Among retailers touting bag-return programs is CVS Pharmacy, the drug store unit of Rhode Island-based CVS Health Corp. The chain sells reusable plastic sacks bearing the chasing arrows logo and fine print instructing consumers to “recycle this bag in participating stores.”
CVS Health spokesperson Eva Pereira did not respond to questions about how many of the company’s more than 1,100 California stores participate. She said CVS hires outside firms to handle its store take-back recycling initiatives “and expects that those partners’ processes are compliant with applicable law.” One of the company’s main recycling solutions vendors, g2 revolution, did not respond to requests for comment.
Amazon.com Inc, too, promotes a plastics take-back program in California. Spokesperson Saige Kolpack said the Seattle-based retailer is “making rapid progress” in reducing its use of single-use plastic packaging. When asked by Reuters to provide evidence that waste returned through its California initiative is being recycled, she said: “We don’t have anything to share for that question.”
Walmart spokesperson Lauren Willis said the bags the retail giant sells in California are designed to meet the requirements of the state’s plastic bag law and “are 100% recyclable through our in-store collection program along with other polyethylene film items that aren’t typically curbside recyclable.” She did not respond to requests to provide documentation on how materials collected this way are recycled or how many of its California locations participate. Walmart has 311 retail units in California, including supercenters, neighborhood markets and Sam’s Club warehouse stores.
Lance Klug, a spokesperson for CalRecycle, said the regulator supports ending “deceptive” labeling on plastic bags and packaging films. But he said enforcement lies with local district attorneys and California Attorney General Rob Bonta.
Bonta’s office said it is committed to enforcing state environmental laws, but said it could not comment on a “potential or ongoing investigation.”
If the state follows the advice of the commission, it could effectively end the sale of these bags and films in California, or force retailers to make them truly recyclable, said commission member Jan Dell, founder of environmental group The Last Beach Cleanup.
“This will destroy their ability to claim that their products are recyclable,” she said.
Globally, less than 10% of all the plastic ever produced has been recycled, according to the United Nations, because it’s cheaper to bury or burn it.
This waste is clogging landfills, despoiling the oceans and harming wildlife. Governments worldwide have responded with polluter-pays laws and bans on single-use plastic such as drinking straws and shopping bags.
In California, the often thicker plastic bags now sold by retailers are supposed to be used dozens of times. In reality, environmentalists say, many consumers quickly toss them in the garbage. Worse yet, they said, those that end up in recycling bins are complicating the work of recycling firms.
Recyclers have to devote time and labor plucking bags out of the waste stream lest they damage their sorting machinery, said Pete Keller, vice president at Republic Services Inc, one of the largest U.S. waste managers. Errant bags frequently wrap around the rotating discs that separate waste by size and weight, he said, forcing recyclers to shut the equipment down.
Keller said he supports stripping recycling language from these bags as part of a wider education effort to get Californians to stop throwing them into their curbside bins.
The plastic industry said that would be a mistake as more would end up as garbage. Some labels direct consumers to a website called How2Recycle, which gives instructions for recycling through store programs, according to Zachary Taylor, director of the American Recyclable Plastic Bag Alliance. The alliance is part of the Plastics Industry Association lobbying group that led the opposition to California’s bag ban.
“Removing state-mandated labeling…will drive more plastic to landfills,” Taylor said.
It remains to be seen whether California responds to the recycling commission and forces retailers to prove their reusable bags are truly recyclable.
Green groups say the state needs to begin cracking down now in preparation for an even bigger enforcement task ahead. In October, Governor Gavin Newsom signed into law a new environmental “truth in labeling” measure for all products and packaging sold in California – not just shopping bags. That legislation makes it illegal for companies to use the word “recyclable” or the chasing arrows symbol on items that aren’t recyclable in the real world.
That legislation goes into effect in June 2025. Between now and then, regulator CalRecycle must come up with a list of plastics which it deems recyclable in curbside programs.
(This story refiles to change ‘bans’ to ‘bags’ in paragraph 8.)
(Reporting by Valerie Volcovici in Washington; editing by Rich Valdmanis and Marla Dickerson)
HONG KONG, Jan 25 (Reuters) – Asian shares and U.S. futures tumbled on Tuesday after a tumultuous Wall Street session, with investors nervous about the situation in Ukraine and eyeing the U.S. Federal Reserve amid worries about a move to tighter monetary policy globally.
NATO said on Monday it was putting forces on standby and reinforcing eastern Europe with more ships and fighter jets, in what Russia denounced as Western “hysteria” in response to its build-up of troops on the Ukraine border. read more
There were sharp declines around the region. Hong Kong (.HSI) lost 1.64% and Korea’s KOSPI (.KS11) fell 1.67%. The Australian benchmark (.AXJO) tumbled 2.73% to hit an eight-month low, hurt also by a high inflation print Tuesday morning that stoked fears of approaching rate hikes Down Under. AZN0236PW
Asian markets were being dragged lower by concerns about faster U.S. rate hikes, mounting tensions over Ukraine, rising inflation and higher oil prices, said Carlos Casanova, senior economist at UBP.
“But on the upside, valuations are becoming more attractive and earnings growth are still robust for some sectors. So I think we will see a tug of war in the market for this week,” he said.
U.S. futures also fell in Asian hours, Nasdaq futures (.NQc1) shed 1.2% and S&P500 futures lost 0.95%, after U.S. stock markets had recovered strongly late in the session to close higher, recouping steep losses made early in the day, as bargain-seeking investors snapped up shares.
Keeping traders on their toes, the Federal Reserve will begin its two-day meeting later on Tuesday, with investors starting to speculate that there is a small possibility that they will announce a surprise rate hike.
Investors are also anxiously looking out for any hints about the timing and pace of rate hikes expected later this year. Money markets are priced for a first rate hike in March, with three more quarter-point increases by year-end.
However, U.S. benchmark Treasuries were sitting out some of the speculation. Yields on benchmark 10 year notes were at 1.76%, steady on the day, having finished a choppy day of trading Monday near where they started.
Singapore’s central bank also tightened monetary policy on Tuesday in an out-of-cycle move. read more
Market nerves sent the dollar higher against most peers. The dollar index was at 95.922, hovering near a two-week high, having gained 0.29% overnight. FRX
The Aussie dollar gained briefly after the high inflation print, but failed to hold on to its gains and the risk friendly currency was still hovering near the one-month low hit the day before.
Oil prices were also elevated, further worrying stock investors. U.S. crude rose 0.5% to $83.73 per barrel and Brent crude was at $86.83, up 0.65%.
Gold held on to its recent gains as investors sought safety. The spot price was at $1,841 an ounce, flat on the day but near last week’s two-month high of $1,847.7.
Reporting by Selena Li, Xie Yu and Alun John; editing by Richard Pullin
Our Standards: The Thomson Reuters Trust Principles.
European markets dropped sharply on Monday as concerns about military tension between Russia and Ukraine and interest rate rises prompted sell-offs.
In London, the FTSE 100 fell more than 2.6%, while exchanges in Germany and France slid nearly 4%.
But shares in the US staged a rebound and closed in positive territory despite falling more than 2% earlier.
The swings came ahead of a meeting of the US central bank and amid warnings of a potential invasion in Ukraine.
Nato on Monday said it was putting forces on standby, after Russia deployed some 100,000 troops and heavy armour at the Ukrainian border. On Sunday, the situation prompted the US, the UK and Australia to order diplomats’ families to leave Kyiv.
“Ukraine clearly is a concern that’s weighing on the markets today,” said Darren Schuringa, chief executive officer of investment adviser ASYMmetric ETFs.
“This will continue to weigh on the markets for the foreseeable future until there’s some type of resolution and more clarity as to what the outcome looks like.”
Concerns about inflation, Covid and other issues have led to three weeks of consecutive declines on US markets.
The tech-heavy Nasdaq has fallen more than 10% from its previous high – a drop considered a market “correction” – and the broad-based S&P 500 is flirting with a similar decline.
Meanwhile, the price of Bitcoin, which hit a high of $69,000 in November, has almost halved since, dropping below $35,000 on Monday, before recovering ground to more than $36,000.
Monday saw moments of torrid selling piling onto January’s losses, with the Dow down more than 1,000 points – nearly 3% – at one point.
But the index, which includes many of America’s biggest companies, closed nearly 0.3% higher.
The Nasdaq reversed a more than 3% drop to end 0.6% higher, while the S&P 500 finished 0.3% up.
The swings come as investors wait for action by the US central bank, which has said it expects to respond to soaring US inflation by raising interest rates this year.
Such moves typically depress stock prices by making other kinds of investments more attractive.
Investors have also been also selling shares as they try to position themselves ahead of a wave of reports from companies about their end-of-year performance.
Last week, Netflix, one of the biggest names to share results so far, disappointed analysts with its forecast for the upcoming months, prompting shares to plunge more than 20%.
The declines were seen as a possible warning about other firms.
Walt Disney, which has been focusing on its streaming strategy to compete with Netflix, was among the biggest initial losers on the Dow on Monday, down more than 4% at one point, while Tesla, which reports this week, fell more than 6%.
Shares in both firms later recovered, with Disney ending flat and Tesla down about 1.5%.
Stock markets plunged into the red before recovering to finish the day in positive territory on Monday, as fears over war in Ukraine and higher interest rates in the U.S. and Canada took investors on a wild ride.
Early in the afternoon, the Dow was off by more than 1,000 points, or about three per cent, and the tech-heavy Nasdaq was faring even worse as investors worried about the prospect of war in Ukraine.
“What really sparked the sell-off today is the fact that we seem to be marching inexorably towards a full-scale invasion of Ukraine by Russia,” Dennis Mitchell, CEO of Toronto-based investment firm Starlight Capital, said in an interview.
Canadian shares were not exempt from the sell-off, as the benchmark Canadian index was on track for its worst day in months, down more than 600 points, or three per cent at one point.
In the afternoon, however, the market changed direction and investors started buying up shares. All three major U.S. stock groupings, the Dow Jones Industrial Average, the S&P 500 and the Nasdaq, finished the day in positive territory.
“The selling that you’re seeing today is usually a good indication that this is a good buying moment,” Mitchell said.
After falling nearly three per cent by midday, the TSX mounted a comeback of its own in the afternoon but fell short of reversing its losses, and closed the day down 50 points to 20,571.
Dianne Swonk, chief economist with Grant Thornton, said the pandemic has been a time of unprecedented volatility for almost two solid years now, and that can sometimes result in wild swings for stock prices.
“This is giving us a lot of turbulence out there,” she said in an interview, “and the problem is it it ups the uncertainty at a time when uncertainty is already high.”
Prior to Monday’s trading, the major event of the week was slated to be the Bank of Canada’s interest rate decision on Wednesday. Expectations are growing that central banks will soon have to raise their interest rates to keep a lid on inflation, which has run up to the highest level we’ve seen in decades lately.
All things being equal, higher interest rates are bad news for stocks because they raise the cost of borrowing. That gives companies and investors less of an incentive to borrow to invest.
Currently, the market is pricing in about a 60 per cent chance of a rate hike in Canada as soon as this week. If one doesn’t come this time around, it’s a near certainty to happen next time the bank meets in March, according to trading in investments known as swaps.
Swonk said some of the uncertainty comes from figuring out how central banks are going to try to find the right balance between keeping a lid on inflation but also not harming the economy that is still being hit by Omicron.
“They don’t want to put the flame out on the economy, but they certainly want to cool it off a bit,” Swonk said. “That’s left many people unsure of how fast rates will go up.”
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