China Scrap Reductions and its effect on scrap metal recycling

November 26, 2017

From the NY Times

China Slows Garbage Imports and Impact Is Felt Globally

China, a longtime importer of international waste, has tightened its regulations, weighing on livelihoods domestic and foreign.

By LAM YIK FEI, MIKE IVES, JEAN YVES CHAINON and GUGLIELMO MATTIOLI on Publish Date November 25, 2017. Photo by Lam Yik Fei for The New York Times. Technology by Samsung.. Watch in Times Video »

HONG KONG — When the street value of scrap cardboard here fell by nearly a third this summer, Leung Siu-Guen, a scrap collector, started to worry.

“I began skipping dinner so I could work harder,” said Ms. Leung, who was already moonlighting as a dishwasher, sleeping fewer than five hours a night and making as little as $500 a month. The drop in price, to the equivalent of about 6 cents a kilogram, would require further sacrifices.

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A woman breaking down a cardboard box for recycling in Hong Kong last month. Thousands of small-time scrap collectors in Hong Kong sell waste to traders to be processed and exported to mainland China or elsewhere. Credit Lam Yik Fei for The New York Times

Since the 1990s, the world has shipped its waste paper, discarded plastic and unwanted metals to China, where they are destined to be used as raw materials to help power the country’s export-driven manufacturing boom. In 2016, China imported about $18 billion worth of what the government calls solid waste.

But China doesn’t want to be the rest of the world’s trash can. Over the summer, regulators in Beijing started an unusually intense crackdown on what they called “foreign garbage,” citing health and environmental concerns.

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Recycled paper sorted into grades, each with a different value on the recycling market. Credit Lam Yik Fei for The New York Times

As with so much else in the global economy, China’s decision is rippling through a vast supply chain that stretches from big waste companies in Texas to the “cardboard grannies” in Hong Kong like Ms. Leung that pick through mounds of paper and plastic. Scrap dealers are rushing to find buyers elsewhere in Asia, but the Chinese market is so large that it cannot be easily replaced.

“It’s almost like they turned the spigot off overnight,” said Jim Fish, the president of Waste Management, a Houston-based company that is the largest recycler of residential waste in North America.

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As China revved up its manufacturing machine to power growth over the years, officials were willing to tolerate some of the downside of scrap, namely the pollution of local soil and rivers by low-end recycling practices. But China’s economic might increasingly means that it no longer needs to make such environmental sacrifices.

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A scrap dealer in Hong Kong. Credit Lam Yik Fei for The New York Times

Fears of widespread domestic pollution were amplified by “Plastic China,” a recent documentary film about a bleak town in the eastern province of Shandong where people earn their living by picking through scrap plastics and processing them in machines that belch black smoke. The film went viral in mainland China in January before disappearing from the internet there.

Pollution in the industry is “not only China’s problem,” said Wang Jiuliang, the film’s director.

“It’s the world’s common challenge,” he said.

China’s regulatory fight against imported garbage began in 2013, when a flurry of port inspections forced overseas recyclers to clean up their operations and invest in new waste-sorting technologies.

In July, China raised the stakes by telling the World Trade Organization that it would ban 24 kinds of imported waste, including some types of paper and plastics, by the end of the year. Chinese regulators also began restricting wastepaper imports.

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Post-consumer plastics are collected in Hong Kong, and later used as feedstock for factories in the Chinese mainland Credit Lam Yik Fei for The New York Times

“I was angry, but I knew I was just a small businesswoman,” Ms. Leung, 63, said of the wastepaper restrictions as she picked through cardboard, polystyrene and soda cans in a rat-infested alley in the Mong Kok district of Hong Kong on a recent morning.

Ms. Leung and thousands of other small-time scrap collectors sell the waste to traders at bare-bones collection points in this semiautonomous Chinese territory. The waste is then processed at recycling depots and exported to mainland China or elsewhere.

In the United States, the new rules mean more garbage could stay at home. While that could be good news for some recyclers, it could also mean more waste in the country’s landfills, according to the Institute of Scrap Recycling Industries, a lobbying group based in Washington.

Recyclers might also have to upgrade their facilities to handle the waste, leading to higher costs for American municipalities and taxpayers, said Adam Minter, a recycling expert and author of “Junkyard Planet: Travels in the Billion-Dollar Trash Trade.”

“Without China, there will be less recycling in the United States, and it will cost more,” Mr. Minter said.

Workers at Hong Kong’s junkyards and scrap depots said that Beijing’s new and pending restrictions on waste imports were already affecting their bottom lines.

At a recycling depot on the city’s outskirts that looks out onto the Chinese mainland, the manager, Ryan Cheung, said local scrap collectors were selling him more plastics than usual, apparently because the new rules were already limiting their options. As a result, chest-high pallets of off-white packaging film were piling up under the depot’s corrugated-metal roof.

“I can’t buy anymore,” he said, standing near a pitching-mound-size heap of dismembered Barbie dolls as garbage trucks lumbered down a nearby road toward a landfill. “I have too much.”

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Credit Lam Yik Fei for The New York Times

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