Those warnings came home to roost this week. Recycling giant Visy told Wheelie Waste, a bin collector that services 11 councils in Victoria’s west including Greater Shepparton, Macedon Ranges, Horsham and Ararat, that it would stop accepting council recycling on February 9. The company cited China’s ban as the reason for the move. Wheelie Waste declined to comment, and Visy did not respond to requests for comment. The Age understands several other councils have also been told they will lose service. "We think ultimately there’s a potential for them all to be affected," Municipal Association of Victoria CEO Rob Spence said. "This is just the beginning of the potential impacts." Deakin University hazardous materials management lecturer Dr Trevor Thornton said there was a “50/50” chance that the ban could result in the collapse of the recycling system in Victoria.

Councils will need to find somewhere to store their recycling – either by paying more to recycling operators, or putting it in landfill. The crisis "would inevitably affect rates," Dr Thornton said. Councils across the state spend about $600 million a year on kerbside recycling, about 12 per cent of their total budget. There are fears recycling will end up as landfill. Credit:Graham Tidy Many councils are now scrambling to work out how to keep services running. “We’ll certainly be calling on our community, until we get a solution, to try to think very carefully about purchasing things in recyclable containers – plastic bottles, for example," Macedon Ranges Shire Council mayor Jennifer Anderson said.

“We need to minimise what’s going into recycling bins. It will have to be an effort from everyone." Asked whether kerbside collection would continue, Cr Anderson said: “We don’t know the answer at this stage. It’s a big thing we have to work through, and it will take us a bit of time." Meanwhile, Horsham Rural City Council plans to begin stockpiling recyclables in the hope China "changes its mind", Mayor Pam Clarke said. Surf Coast Shire mayor David Bell said: “If Visy doesn’t want it I don’t really know what we’ll do with it.” And Warrnambool mayor Robert Anderson said: “It’s across the state - the government will have to step in fairly soon.”

Moyne Shire director of sustainable development Oliver Moles is concerned about where his council's recycling will end up. Credit:Christine Ansorge, Warrnambool Standard Moyne Shire sustainable development director Oliver Moles said his council had contacted federal and state leaders so a solution to the problem could be found. “If costs keep barrelling out of control we’re going to require federal and state governments to assist us in dealing with this issue,” he said. Mr Moles said if waste had nowhere to go, there was a chance councils would be forced to explore putting recycling into landfill, but Moyne Shire was doing everything it could to avoid that possibility because it was “environmentally and socially” wrong. Melbourne City Council is one of many that has a contract with Visy to deal with its recycling, but on Wednesday it said it did not expect services to be affected.

Australia’s recycling industry, including Visy, relies on China as a major market for recycled paper and plastics. About 30 per cent of all our recycling is sent there, the industry estimates. But the Chinese government has recently banned the import of recycled materials in an effort to prop up the domestic recycling system. It leaves recyclers such as Visy with nowhere to send waste, even as homeowners keep doing the right thing and filling up their yellow-lid bins. “The council’s kept giving it to them, and the recyclers have no recourse. It’s like throwing the rubbish over your back fence – ‘it’s not in my backyard’,” Victorian Waste Management Association chief executive Peter Anderson said. “The councils are dumping their rubbish on the providers. And when the commercial process breaks down, there is no recourse for those providers.”

If they cannot sell it, recyclables end up building up on site, which can lead to fires. The industry believes stockpiling led to several recent fires at recycling centres and concerned insurance brokers say the industry is becoming uninsurable. Visy has been openly warning of this exact scenario for some time. In a submission to a parliamentary inquiry into recycling in October, the company warned that “existing commercial arrangements will no longer be financially sustainable” when China’s ban came into force. “The impacts of the China ban are already being experienced, with stockpiling of product in the hope that prices will improve. This excessive stockpiling is an environmental hazard and significantly increases the risk of fires, with a significant fire recently burning for over one week in Victoria,” the submission reads. “Coupled with the increasing rates of recycling globally, [this] will see a glut of recyclable materials with 'no home', and prices will inevitably plummet due to supply and demand dynamics.”