China plastic scrap ban reactions range from 'devastating' to an opportunity

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China's 18 July announcement that it will ban imports of scrap plastics and other "foreign garbage" recyclables by the end of the year was met with quick criticism from global recycling groups, who described the move as "devastating" and "catastrophic."

The Institute of Scrap Recycling Industries in Washington and the Brussels-based Bureau of International Recycling both expressed alarm, with ISRI noting that China is the largest market for U.S. recycling exports.

But others in the industry saw potential positives.

"I look at it as an opportunity to strengthen the domestic industry," said Steve Alexander, president and CEO of the Association of Plastic Recyclers. "We could peel ourselves back from the volatility of the Chinese market."

Chinese officials painted the decision, which had been rumored for weeks, as necessary to protect their environment and public health.

"We found that large amounts of dirty wastes or even hazardous wastes are mixed in the solid waste that can be used as raw materials," China's Ministry of Environmental Protection said. "This polluted the environment seriously.

"To protect China's  environmental interests and people's health, we urgently adjust the imported solid waste list, and forbid the import of solid wastes that are highly polluted," it said.

China formally notified the World Trade Organisation of the ban on July 18, and said it would cover 24 kinds of plastic, paper and metal recyclables, including specifically PET, PVC, polyethylene and polystyrene and a catch-all category of other scrap polymers.

Some global recycling industry groups were critical.

"Whilst BIR and its members support and promote high-quality standards for scrap exports, this ban, if implemented, will have a serious impact on the global recycling industry," said Arnaud Brunet, BIR director general, in a statement. "International scrap trade flows to China amounted to tens of billions of U.S. dollars' worth of goods which are needed by the domestic Chinese industry for production."

China in 2016 imported 16 billion pounds of recycled plastic from all other countries, BIR said. That included about 5.5 billion pounds each of polyethylene and PET, with about half of the global trade of recycled PE going to China, according to the Tarrytown, N.Y.-based data and consulting firm International Trader Publications Inc.

Exports from North America were generally smaller than from other regions.

Western Europe and other Asia Pacific countries each sent about 2.2 billion pounds of recycled PE to China, while the United States and Canada together sent about 793 million pounds, ITP said.

And in PET, about 4.2 billion pounds of Chinese imports came from other Asia-Pacific economies in 2016, with North America supplying a little less than 440 million pounds, ITP said.

Steve Alexander of APR, who said the ban could create opportunities for US recyclers, acknowledged he could be looking at the situation through "rose-colored glasses." But he noted that U.S. exports of recycled plastic bottles have dropped in recent years.

In 2008, more than 40% of plastic bottles collected in the U.S. were exported, but that dropped steadily to 21% in 2015, the last year data is available, APR said.

Some of the drops have been China-related. Recycled PET exports fell from 34% of collected PET bottles in 2012 to 23% the next year, for example, when an earlier Chinese crackdown on recyclables, called Green Fence, started, APR said.

Keeping more recycling in the U.S. could help convince brand-owners to use more recycled plastic content, since they sometimes say supply availability is a concern, Alexander said. And he added that recycling in countries where material is collected reduces greenhouse gas emissions.

Still, he worries that this is coming at a time when some waste hauling companies are cutting back on collecting plastics for recycling, over concerns about the strength of markets.

ISRIWeiner

Washington-based ISRI was one of the groups expressing serious concerns.

"A ban on imports of scrap commodities into China would be catastrophic to the recycling industry," ISRI President Robin Weiner said in a statement. "[A ban] will result in the loss of tens of thousands of jobs and closure of many recycling businesses throughout the United States."

ISRI said it immediately notified the U.S. government, including the US Trade Representative and the US Department of Commerce, about its objections and briefed them ahead of the July 19 high-level talks in Washington between the two countries, the Comprehensive Economic Dialogue.

For its part, BIR said it planned to engage with the Chinese government to talk about what it sees as the negative economic and environmental impacts of a ban.

BIR also said it sent a letter 20 July to the WTO, complaining about the "extremely short" 20 July deadline the Chinese government set for comments on its ban. BIR has asked for an extension to the standard 60 days.

"BIR calls upon the Chinese government to reconsider its ban policies and offers to further discuss ways of ensuring high-quality standards without adversely affecting the global recycling industry and the Chinese economy," the association said.

China's ban comes as environmental protection and customs officials in the country continued their National Sword crackdown, announcing they would do intense inspections of plastics facilities in July.

The Beijing-based China Scrap Plastics Association said 888 factories had been inspected by 14 July, about half of the 1,792 factories in the country licensed to import waste plastics.

CSPA said Chinese media were reporting that 590 factories were found to have rule violations, with 349 put under investigation for those violations.

It said with 383 factories had their production suspended and 53 were closed, and that factories with violations could have their import permits suspended for one year.

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