Attendees of this spring’s high-profile conferences in Shanghai and in Orlando, Fla., compared notes on the industry’s strides, setbacks and outlooks.
Those involved in the recycling, brokering and shipping of secondary materials have had their share of issues to contend with in 2013, including price volatility and stricter material inspections at Chinese ports. Declining material generation also is having an impact near and far. Events in the United States and Asia brought many of these concerns to the surface this spring.
Victories and Challenges
Sessions at the Institute of Scrap Recycling Industries Inc. (ISRI) 2013 Convention and Exposition addressed some of the challenges facing the recycling industry as well as a recent victory. The event, held April 9-13 in Orlando, Fla., at the Orange County Convention Center, featured a diverse array of educational sessions addressing topics as varied as commodities outlooks, plastics identification and emerging markets.
The range of programming as well as the multiple networking opportunities and the destination helped to draw attendees out for the show, which, according to convention organizers, marked ISRI’s third-largest convention—and the largest attendance outside of Las Vegas—with more than 5,200 attendees.
The April 10 opening general session provided an overview of the development of the scrap recycling industry in addition to highlighting recent advances and areas that require further progress. ISRI Chairman Jerry Simms of Atlas Metal & Iron Corp., Denver, Colo., acknowledged a recent regulatory triumph for the industry, noting that ISRI successfully obtained approval to recycle the plastics recovered from auto shredder residue from the U.S. Environmental Protection Agency after convincing the agency the practice did not endanger workers or the environment.
Honors were bestowed to Arnold Gachman of Gachman Metals and Recycling Co., who received ISRI’s Lifetime Achievement Award, and Francis Veys, the retiring general director of the Brussels-based Bureau of International Recycling. Also at this opening session, former governors Ed Rendell, a Democrat from Pennsylvania, and Haley Barbour, a Republican from Mississippi, shared their views on the current political landscape in Washington, D.C.
Subsequent sessions at the ISRI conference narrowed the perspective to topics currently affecting recyclers in the United States, such as China’s recently erected Green Fence.
Shippers of secondary commodities to China slowly learned about “Operation Green Fence” in early 2013. The effort by Chinese environmental and customs officials to more vigorously inspect and, in some cases, reject what they consider to be subpar container loads has greatly affected exporters throughout the industry.
Speakers addressed the changing nature of ferrous scrap markets during the Spotlight on Ferrous session, held April 11. Phillip Hoffman, vice president of U.S. ferrous scrap trading for Medtrade, the U.S. subsidiary of Turkish steel producer Colakoglu Metaluji, said 1.56 billion metric tons of steel were produced worldwide in 2012 using 579 million tonnes of scrap.
The Bureau of International Recycling (BIR) 2013 World Recycling Convention posted another strong performance, drawing more than 1,100 participants from 57 countries to Shanghai. This year also marked the end of an era for the organization, as Francis Veys attended his final Bureau of International Recycling (BIR) convention as director general. Veys steps down from his post 31 August this year and will be succeeded by BIR’s current General Manager Alexandre Delacoux, who joined the Brussels-based body in 2012.
Veys’ contribution to BIR over the course of 38 years, including more than three decades as the head of the Brussels secretariat, drew rich praise from a succession of speakers in Shanghai, including a heartfelt vote of thanks from BIR’s re-elected World President Björn Grufman at the General Assembly 28 May. “He has always been the man behind the scenes and not the diva in the spotlight—the mastermind behind the organization as it is today,” Grufman told attendees. Under Veys’ stewardship, BIR’s membership effectively tripled.
Another recycling industry leader was honored at the BIR General Assembly in Shanghai, with a presentation being made to Ma Hongchang, who until recently was vice secretary general of the China Nonferrous Metals Industry Association Recycling Metal Branch (CMRA). Praised by Grufman for his role in the development of stronger links between BIR and China, Ma envisaged a “bright future,” for CMRA/BIR co-operation.
Also at the General Assembly, BIR treasurer Ranjit S. Baxi confirmed that the world organization had recorded “healthy” financial results in 2012 despite the difficult economic conditions. Earlier, in his role as president of the BIR Paper Division, Baxi had presented its latest Papyrus prize to one of Asia’s most prominent and influential businesswomen: Cheung Yan, chairwoman and founder of the world’s largest recovered paper-based paper manufacturer, the Nine Dragons Group.
In accepting the prize, which recognizes her contribution to paper recycling and to building partnerships, Cheung described recyclers as “the protectors of the environment.”
This award ceremony was followed by BIR’s Keynote Session, at which guest speaker Chandran Nair, CEO of the Global Institute for Tomorrow, argued that the 6 billion Asians who will inhabit the planet by the year 2050 could not aspire to the lifestyles of the Western world’s current middle class because sufficient resources would not be available. “We need to look at things very differently,” he told delegates, describing “a century of austerity” in which economic activity would need to become subservient to protecting natural systems.
Market reports and guest presentations offered at the BIR World Recycling Convention revealed a mixture of resignation, concern and hints of optimism for the recycling industry. Steel industry analyst Peter Marcus of World Steel Dynamics, Englewood Cliffs, N.J., speaking at the BIR Ferrous Division meeting, predicted the steel industry would continue to travel the “rutted road” it started out on in 2008 through the rest of this year and into 2014. Marcus said he was bearish about ferrous scrap and iron ore pricing during that stretch, declaring “Steel’s iron age is over.” He predicted, though, that raw material costs would swing back in favor of scrap as a feedstock, probably by 2015.
The 2013 BIR World Recycling Convention & Exposition was at the Pudong Shangri-La Hotel in Shanghai 27-29 May.
The debut Paper Recycling Conference Asia was an ideal gathering place for recovered fiber buyers and sellers in the midst of a turbulent market. Delegates from nearly 30 countries convened at the Hongta Hotel in Shanghai 30-31 May to gain insight into the rapidly changing recovered paper market.
The nearly 200 attendees at the Paper Recycling Conference Asia, organized by the Recycling Today Media Group, SmithersPira and the China Technical Association of the Paper Industry (CTAPI), took part in several lively discussions. The assembled delegates heard from speakers from throughout Asia, Europe and North America at six conference sessions spread out over the two days.
Representatives from major mill companies, such as Lee & Man, Smurfit Kappa and SAICA; brokerages such as Cellmark, Ekman Recycling and Ralison International; and groups including CTAPI and the Publishers National Environment Bureau of Australia were on the program.
Keynote speaker Professor Wang Yangzu, formerly of China’s Ministry of Environmental Protection, noted secondary raw materials had played a crucial role in China’s economic growth over the past 15 years. “We have a lot of mineral resources, but we are only 53rd in the world in terms of mineral resources per capita,” Wang stated.
“We have enjoyed the benefits of importing recycled resources,” said Wang, adding that it had saved considerable timber and ore resources in China and around the world. “It also has provided more than 1 million job opportunities [in China],” he said.
Audit partner Sally Sun of Deloitte’s Shanghai office provided an overview of Asia’s paper industry and also pointed to the critical role of recycling. China’s forest resources provide only “17 percent of the [feedstock] needs” for its paper mills, she noted. “Scrap paper fills a large proportion [of what is needed], and some 30 million tons is now imported annually.”
Although China’s paper mills need that fiber, speakers on subsequent panels commented that the government’s Operation Green Fence was making the process difficult.
Sarah Feng, a recovered paper senior analyst with UM Paper, a RISI subsidiary in China, noted that some mills had suspended importing the mixed paper grade as one response to try to meet a 1.5 percent contamination threshold being enforced by customs inspectors. Both mills and suppliers were affected by having to pay demurrage and additional shipping costs, she said.
Vivian Ou of Ralison International, Diamond Bar, Calif., said the situation could be frustrating but manageable. “I saw clean bales at the plant of one of our large suppliers, but they were probably not clean enough to pass the new customs standards. I can buy them, but China won’t let them in.”
Ou said that while it might be hard for suppliers to change by adding extra personnel or additional processing steps, “They have to face this, and most of our suppliers are making changes.” The suppliers have to change for the sake of their own profitability, she commented. “They told me how much money they’ve lost in the last two months,” Ou said of one supplier.
The ISRI and BIR conventions and the Paper Recycling Conference Asia provided a forum for those involved in the trading of secondary materials to share their experiences. As fall approaches, more conferences will address issues facing recyclers.
Among them are events organized by the Recycling Today Media Group, including the Paper Recycling Conference & Trade Show, 16-18 Oct., in Chicago; Paper Recycling Conference Europe, 30-31 Oct., in Warsaw, Poland; and the Renewable Energy from Waste Conference, 30-31 Nov., in West Palm Beach, Fla. More information is available online at www.PaperRecyclingConference.com and at www.REWConference.com.
Brian Taylor is editor and DeAnne Taylor is managing editor for the Recycling Today Media Group.