At the bottom of the recycling trade: Karung gunis and cardboard collectors

Contributed by SINGAPORE ARMCHAIR CRITIC –

After 4pm and over the next two hours before the karung guni man called it a day, elderly cardboard collectors began trickling in from the two roads that lead to the collection point. Bathed in the golden rays of the evening sun, the old folks pushed their cartful of flattened cardboard slowly forward with a doggedness that belied their frail and scrawny appearance.

There were both men and women plying their trade. Their shriveled skin, withered arms and grey hair are telling signs of their advanced age.

Ah Lan, whose husband is an amputee, is 86; auntie Aw, who came all the way from Whampoa to Toa Payoh to sell her cardboard, is 77; another white-haired woman who is all skin and bones, spoke of attending a briefing for the “Pioneer Generation” on the coming Saturday; and there’s 70-something uncle Lee, who is hard of hearing and had to be repeatedly reminded of an approaching lunch event organized by a group of good Samaritans.

For every kilogram of cardboard, the elderly get 10 cents in return. The old folks consider this an attractive rate in comparison to what other karung gunis pay – sometimes as little as 5 cents per kilogram of cardboard.

As the petite auntie Aw walked past, smiling brightly, I saw two two-dollar notes in her now empty cart.

If those were her day’s earnings, it meant she must have collected and sold around 40 kilograms of cardboard that day.

shutterstock_87916783 — Pioneer generation cardboard collectors have to endure back-breaking work for a meager sum

At the collection point, the tanned and bespectacled karung guni Mr Lim was busy operating a forklift to stack up piles of cardboard. He said he in turn sells the collected stuff to a big paper trading firm and makes a few cents per kilogram of cardboard.

Now in his forties, Mr Lim, who has been in this line for twenty over years, belongs to a dwindling pool of karung gunis still hanging on to a dying trade (watch video).

Old Economy Meets New

Until the late 1990s, there were about 3,000 self-employed rag and bone men in Singapore. In their heyday, karung gunis could make as much as $500 a day; some even went from rags to riches.

The karung guni industry went downhill from there.

In 1999, Community Development Councils (CDCs) and recycling firms teamed up to offer door-to-door recycling service.

Two years later, in 2001, the National Recycling Program kicked off. Under the program, public waste collectors or karung gunis must work together with registered recycling firms to offer door-to-door recycling.

Rivalry between the old economy karung gunis and new recycling companies soon heated up.

Partnership between CDCs, town councils and large recycling firms such as SembWaste, whose subsidiary Semac was awarded a huge $3.3 million contract to collect and dispose the waste of CapitalLand Group, severely threatened the livelihood of karung gunis.

There were cases of karung gunis beating up employees of recycling firms, as well as frequent incidents of karung gunis “stealing” bags with recyclables collected by employees of recycling firms.

Then in 2001, the Waste Management and Recycling Association of Singapore (WMRAS) was formed and launched by Acting Environment Minister Lim Swee Say.

The first of its kind in Singapore, the association aimed to “give the industry a voice, instil professionalism and mediate between recycling firms and rag-and-bone men.” It was chaired by Loh Wai Kiew, head of Sembcorp Waste Management (SembWaste).

Said Loh: “Our interest is to sit down and work with them [karung gunis] in a win-win situation under one framework.”

The possibility of a win-win outcome seems slim

SembWaste was the waste management and recycling arm of SembCorp Environmental Management, part of the government-linked SembCorp Industries. The paper recycling business was so lucrative that SembCorp Environmental Management paid $4.68 million for a 60% stake in a local company, Tay Paper Resources.

By 2002, competition had driven around one quarter of the 3,000 karung gunis to become employees of big recycling firms.

Others who refused to be co-opted said they preferred to work on their own instead of working for recycling firms, which might force them to sell their scrap at fixed prices.

Fair Play? Survival of the Fittest?

By 2003, only four big companies dominated the entire Singapore household waste market worth about $180 million.

In contrast, more than 300 small and independent operators made a living out of trash collected from the commercial and industrial sector, a shrinking pie worth $170 million in 2003.

karung gunis

Not content with their domination of the household waste market, the big players wanted a piece of the commercial and industrial pie too.

These big firms, which were able to charge less for waste disposal on economies of scale, demanded stricter government regulations for the commercial and industrial sector on the pretext of the findings of a study commissioned by the WMRAS chaired by the head of SembWaste.

A WMRAS spokesperson Seah Khen Hee claimed that this was “no David versus Goliath battle, but a move to raise service standards across the industry.”

What about the livelihood of small players like the karung guni men who were already squeezed out of the household waste market?

Well, WMRAS chair Loh Wai Kiew said “training for waste collectors would be launched under the National Skills Recognition System by the end of the month to help the small players match up.”

But how could small players ever “match up” to big firms, in an industry that is both regulated and dominated by the government and government-backed firms like SembWaste?

Plummeting Prices of Recyclables

Ekeing out a living became even tougher for the handful of surviving karung gunis after the 2008 financial crisis.

Falling demand for scrap paper and metal from factories and recycling plants in the US and Europe depressed the prices of recyclables (see charts below). Recycling firms in Singapore, which exported to these destination markets and also China, Indonesia and Malaysia, then paid less for the scrap collected by karung gunis.

Source: Department of Statistics, CEIC Data.

Karung gunis, in turn, could pay individual scavengers and sellers only about seven cents for a kilogram of paper, less than 10 cents per kilogram of plastic, and 60 cents per kilogram of scrap metal.

On top of shrinking profits, karung gunis had to deal with a growing number of foreigners muscling in on the rag and bone trade (read my full report).

Said Mr Tan, whose earnings had dropped because of foreigners entering the trade: “We local karung guni men follow a code. We don’t go into an area if another karung guni man is there. We respect his being there first and we go elsewhere … But the foreigners don’t care. They barge in. That’s when the fighting starts.”

Another local karung guni, Mr Ng, said: “Every other month, I see a new competitor. Most of the time it is a foreigner.

Of course I get angry. This has been my rice bowl for more than 20 years.”

Faced with the triple whammy of falling prices for recyclables, stiffer competition from big companies at the top and foreigners at the bottom, karung gunis and their trade may soon fade into history.

As Winston, a 46-year-old karung guni lamented: “Soon, there won’t be many of us left.”

Sources:

“Karung guni men beat up worker from recycling firm,” 14 Aug 2001.

“Playing catch with karung guni men,” ST, 21 Aug 2001.

“Lament of an old-economy karung guni man, ST, 5 Sep 2001.

“Working for others a pain,” ST, 8 Sep 2001.

“New group to push for recycling ST, 13 Sep 2001.

“Karung guni men ally with recycling firms,” ST, 28 Sep 2002.

“Smaller pie for garbage firms,” ST, 8 Mar 2003.

“It’s official. S’pore’s a paper junkie,” ST, 14 Jun 2003.

“Karung guni man sues SembWaste,” ST, 16 Jul 2004.

“Scrap traders feel the crunch as prices dive,” ST, 13 Nov 2008.

“Some firms sell at a loss,” ST, 1 Dec 2008.

“Fight over junk gets dirtier,” ST, 4 Oct 2009.