Recycled pellet imports to China increase

The most recent edition of the China Replas 2018 e-newsletter contains four market updates: Three of them focus on resistance to plastic scrap imports in Southeast Asian nations, while the fourth points to volume increases in plastic pellet exports to China.

The early July dispatch from the China Synthetic Resin Association (CSRA), one of the organizers of Expo-ChinaReplas2018, Sept. 13-14 in Dongguan, China, follows coverage of plastic scrap import restrictions in Malaysia, Thailand and Vietnam with an article stating in part, “China has transformed itself from being the world’s largest importer of scrap plastics to the largest importer [of] recycled granulates.” (A recap of the plastic scrap import barriers forming in the Association of Southeast Asian Nations [ASEAN] region can be found at www.RecyclingTodayGlobal.com/article/plastic-scrap-recycling-vietnam-thailand-ports-clogged.)

According to the CSRA write-up, recycled-content plastic pellets initially were caught up in the same dragnet blocking baled plastic scrap imports. Customs officials in China, the CSRA says, were applying a principle of “three conformities [too] strictly” to pellets. Those principles refer to uniformity of color, size and shape in recycled material imports.

Despite the confusion, recycled-content pellets have been flowing into Chinese ports. The CSRA says, “China’s imported [recycled-content pellets] have increased from less than 10,000 metric tons per month to 300,000 to 500,000 metric tons per month; the import volume has soared.”

CSRA says it is working with China’s Ministry of Ecology and Environment (MEE) and the General Administration of Customs (GACC) “to convey the opinions of the industry and the actual problems at the port.”

The dialogue included meetings at the April 2018 Spring Conference of China Replas and the May 2018 Symposium on the Regulation of Recycling Plastic Particles, hosted by the GACC. At that event, the CSRA says, “the industry and the government worked together to seek solutions.”

Subsequently, in early June, “A systematic solution to this problem was developed and submitted to the MEE and the GACC,” according to the CSRA.

“China’s imported [recycled-content pellets] have increased from less than 10,000 metric tons per month to 300,000 to 500,000 metric tons per month; the import volume has soared.” – China Synthetic Resin Association

The trade group forecasts that by the end of August, “Customs clearance of recycling plastic particles [will] be normalized.”

In the U.S. market, the Institute of Scrap Recycling Industries (ISRI), Washington, reports in its “Weekly Market Report” e-newsletter for July 23 that natural high-density polyethylene (HDPE) bales continue to increase in price, having surpassed levels last seen in 2016. “Mixed color HDPE bales are not enjoying such a steady rise in pricing, reflecting that the market is pushing secondary processing further upstream,” the association notes.

According to PetroChem Wire, headquartered in Houston, natural HDPE bales sold for 44 to 45 cents per pound freight on board (FOB) east of the Rockies as of late July, while fractional-melt mixed-color curbside bales traded for 16 cents per pound.

PetroChem Wire attributes the increase in natural HDPE pricing to surging demand for the material for use in food-grade jugs and bottles and other forms of packaging.