Recycling in restaurants is mandatory in some U.S. cities and states, but it can be challenging for staff working in tight spaces.
In Chicago, restaurants must source separate and recycle at least three materials (unless a single recyclable can be shown to comprise 51 percent of the waste stream by weight), meet targeted recycling rates and provide an educational program to new hires.
In San Francisco, restaurants must separate recyclables from trash and organics, and fines for noncompliance can be as high as $1,000 per day.
Fast-food chains and restaurants, which generate large streams of cardboard, plastics and metals, are trying to comply with these recycling laws while also meeting U.S. Occupational Safety and Health Administration (OSHA) standards and managing program costs.
Two companies that are helping restaurants manage their recycling programs are Mil-tek, a global supplier of pneumatic balers with small footprints, and Columbus, Ohio-based Elytus, a managed service provider that helps commercial businesses manage their waste and recycling operations through its WInStream software.
Over the years, fast-food chains have had to rethink their recycling programs and the space they dedicate to this task because of commercial recycling legislation. In some states where single-stream recycling was previously acceptable, restaurants are now required to separate several recyclables.
“Where restaurants used to be able to have a catch-all container for recyclables, they’re now being asked to look at managing several waste streams in the same building,” says Mil-tek USA Executive Vice President and Chief Commercial Officer Kim Vandbaek. “It’s very complex if you’re working out of a 3,000-square-foot restaurant that’s already stretched for space and suddenly you need to add two to three [recycling] streams to your operations.”
Kristian Skannerup founded Mil-tek in 1992 in Denmark with the goal of helping businesses optimize their waste and recycling systems and become “better environmental stewards.” Mil-tek expanded to the U.S. in 2011. Headquartered in Sterling, Virginia, Mil-tek USA focuses on helping restaurants, especially fast-food chains, meet recycling challenges with balers and compactors.
“We’re seeing more and more progressive states requiring source separation,” Vandbaek says. “Paper, plastic and metal has to be separated. Restaurants are finding themselves running out of space and racking up a very hefty bill for all these services because it’s hard for them to be efficient.”
The company says cardboard makes up 40 percent of the recycling stream in restaurants. Mil-tek offers balers for old corrugated containers (OCC), as well as for film plastics, metal cans and polystyrene. The company’s polystyrene densifier, typically used by reprocessors or recycling companies, creates compact bricks that can be sold to manufacturers.
Mil-tek says its smallest cardboard baler takes up 22 by 32 inches of floorspace and is powered by air, which means it meets health and safety codes for in-kitchen use and helps restaurants prepare small bales for haulers and recyclers.
Mil-tek provides restaurants training and education, as well as recycling coordination. The company partners with haulers and recyclers across the U.S. to ensure materials separated at the source find proper end markets.
“Basically, when you buy one of our machines, you get a relationship with a recycling hauler,” Vandbaek explains. The network “consists of a lot of local haulers that are helping us out region by region, city by city to be able to get this kind of coverage. You can claim a baler is a baler is a baler, but the solution in its totality is what makes the difference.”
“If I asked a restaurant in California where they would need most help in their operations, half of them would mention waste and recycling programs.” – Kim Vandbaek, Mil-tek USA
In Houston, Mil-tek has established relationships with about 200 restaurants and area recyclers. “These customers had only limited recycling, and now all their materials can go straight into the recycling industry realm,” Vandbaek says. “It significantly increased the market in Houston.”
Julien Greboval, Mil-tek USA’s sales and marketing coordinator, explains that Mil-tek is at the beginning of a larger industry value chain. As more restaurants separate recyclables at the point of generation and bale materials, clean commodities are added into the recycling stream.
“Contamination is one of the largest issues today, and China has turned way more sophisticated when it comes to contaminated products, so at-source compaction and at-source baling ensure a cleaner product,” Vandbaek adds. “We find very little contamination percentages in the products that are coming out of our balers. It meets what we normally call tomorrow’s standards, but it appears to be today’s standards now.”
Another company working in the restaurant sector is Elytus. When Matthew Hollis founded the company in 2011, he says very few commercial kitchens and restaurants had recycling programs. He learned why by watching the kitchen hum during dinner rush.
“They’ve got a menu of 100 different items. They’re receiving orders every other second. They’ve got 15 people back there chopping, cutting and turning out these dishes with precision,” Hollis says. “What we realized is the biggest reason restaurants weren’t recycling is it just was not efficient or easy enough for the back-of-house staff to do.”
Elytus helps restaurants and grocery store chains implement recycling programs through technology. The company’s WInStream software helps manage complex waste and recycling systems and gives businesses data about what recycling streams are being generated.
Understanding the value of the recyclables restaurants generate not only cuts down on disposal costs, Hollis says, it also helps them become more sustainable.
In San Diego, restaurants are required to divert 40 percent of recyclables, but rising landfill tipping fees also encourage restaurants to find efficient recycling programs, Hollis says.
“In California, where it’s $150 per ton to dispose of waste, compost and recycling becomes a necessity really quickly,” he adds.
Elytus also helps restaurants recycle nontraditional commodities. Through its fry oil recovery program, for instance, restaurants can arrange for collection of and receive rebates for their end-of-life oil.
Changes in commercial recycling regulations have presented challenges and opportunities for the recycling industry.
Mil-tek unveiled a compactor at the Chick-fil-A NEXT conference in February in Anaheim, California. The compactor was developed with feedback from Chick-fil-A operators to address the needs of the restaurant community.
“If I asked a restaurant in California where they would need most help in their operations, half of them would mention waste and recycling programs,” Vandbaek says. “Nobody is really focusing on that, and with this increased requirement for further recycling, larger chains are demanding solutions for this.”
As recycling regulations continue to evolve, Vandbaek anticipates that the need for recycling programs in the sector will only increase.
“More and more convenience stores and gas stations are opening fast-food chains and more supermarkets are opening their own cafés or restaurants to create better experiences for customers,” Vandbaek says. “That also means that our products are becoming more widely applicable.”
The author is the digital editor for the Recycling Today Media Group and can be reached at firstname.lastname@example.org.
Capturing the last can
Features - MRF Series
MRFs that have added a second eddy current to their sorting lines have been able to capture more UBCs that otherwise would have been lost to residue.
Material recovery facilities (MRFs) that operate a second eddy current on their sorting lines can divert an additional 30,000 pounds of aluminum per month on average compared with MRFs that operate a single eddy current. Purchasing and installing a second eddy current can cost a MRF $110,000, which puts the typical return on investment (ROI) at less than six months because of the high value of aluminum. (The January average U.S. price for used beverage cans, or UBCs, was $25.64 per pound, according to data from Fastmarkets AMM.)
During the hauling process, lightweight aluminum cans often are crushed and flattened into two-dimensional “pucks,” making it difficult to separate them effectively with a single eddy current. Many UBCs don’t even make it to the eddy current; they are incorrectly separated out with other materials, such paper and glass, during the screening that separates 2D material from 3D material and are ultimately discarded as residue. MRF operators say UBC losses occur at multiple stages in the sorting process, adding that they are sending as much as 15 tons of aluminum cans per month to landfills.
Republic Services’ St. Louis MRF Manager Brent Batliner realized small pucks of aluminum were being separated with glass at the polishing screen. Those pucks were, of course, too big for the glass screen and so were being discarded as trash. When Batliner checked the MRF’s residue line, he saw that 60 to 80 cans per minute were being trashed. Republic’s St. Louis MRF processes 300 tons per day of single-stream material, 200 tons of which are from residential collections.
With the installation of the MRF’s second eddy current, Republic’s St. Louis MRF has recovered an additional 15 tons per month of aluminum.
Because the second eddy current is ejecting aluminum from the MRF’s glass residue conveyor that is loaded with small pieces of debris, Batliner says he has been able to sell this material for 10 cents less per ton than the truckload per week of bales that are recovered by the MRF’s original eddy current.
But he says the investment was worth being able to recover the additional 30,000 pounds per month. The material recovered from the second eddy current separator is worth less because of its smaller size and the presence of other debris.
“Look at your trash line and count the cans,” Batliner advises MRF operators. “We’re getting crushed cans, pieces of cans and smaller aluminum cans out of residue and into bales.”
In addition to a second eddy current, Republic’s Seattle facility installed optical sorters on its paper quality control lines to further clean its paper. A secondary benefit of those optical sorters is that they are helping to recover additional aluminum that’s embedded in paper and that performs as if it were 2D material rather than 3D material during the sorting process.
“Look at your trash line and count the cans. We’re getting crushed cans, pieces of cans and smaller aluminum cans out of residue and into bales.” – Brent Batliner, manager, Republic Services’ St. Louis MRF
As a result of this additional optical sorting equipment, Republic’s Seattle MRF is diverting nearly an additional truckload of UBCs per month.
As the Republic MRF in St. Louis did, the Waste Management MRF in Elkridge, Maryland, also installed a second eddy current on the glass discharge line of its sorting system. The company had identified that small, crushed UBCs could fit through the gaps in the sizing screen, ending up in the residue.
After the installation of the second eddy current, that facility saw an increased capture rate of about 15 tons per month of aluminum.
Mike Taylor, director of recycling operations at Waste Management, says, “Retrofitting the second eddy current to fit on the glass discharge line wasn’t easy, but it was worth it to capture the material.”
Aiming for high quality
With high-quality material in mind, Eureka Recycling installed several upgrades to the nonprofit’s Minneapolis MRF in 2016 to assist in better separation of paper from containers. Single-stream collection and the compaction of collected material made it increasingly challenging to keep containers out of paper grades and vice versa. Eureka’s single-stream MRF is capable of processing 75,000 tons of recyclables annually.
Kate Davenport, co-president of Eureka Recycling, says, “We saw an increasing number of flattened aluminum cans and plastic bottles in our paper, so we worked with our equipment vendor to install additional screens and ballistics as well as a bigger second eddy current. This helped to reduce the containers in our paper grades by 50 percent.”
She continues, “Because of our philosophy around high material quality, we had already made the investments in equipment to address the increased demand for material quality coming out of National Sword,” she says.
The company’s second eddy current separator, supplied by Machinex of Plessisville, Quebec, further removes aluminum from the paper and increases the recovery of that high-value nonferrous material.
For Eureka’s MRF and those mentioned previously, installing a second eddy current has significantly increased the amount of aluminum they capture. Aluminum’s high value means that each and every can should be correctly sorted, baled and sold.
The author is the former vice president of sustainability for the Can Manufacturers Institute (CMI), Washington. She recently transitioned to the American Beverage Association, where she is senior director of sustainability. For more information on the CMI, visit www.cancentral.com.
Fiber beyond the turmoil
Features - International Fiber Markets
Recyclers and papermakers who gathered for a late 2018 RISI event looked back at a turbulent year and provided thoughts on what’s next.
Fast-changing government policies in China in 2018 produced immediate changes to where recovered fiber is shipped globally, and they also brought major pricing changes for key scrap paper grades.
As the conference participants looked ahead to 2019, they predicted additional reactions within the paper recycling sector as well as beyond that in the paper and board manufacturing industry.
Not so demanding
Conference presenter Bill Moore of Atlanta-based Moore & Associates provided an overview of how Chinese government policies created major changes to global recovered fiber flows in 2018.
Setting aside the turmoil in recovered fiber markets caused by China’s restrictions, Moore said a consensus among many recyclers was that “China’s new standard has been a good thing, despite the pain.”
While demand for and the price of mixed paper have “fallen significantly” because of the policy, Moore said “demand has increased for cleaner grades of recovered paper,” such as double-sorted, or No. 12, old corrugated containers (OCC) in the United States, and its European equivalent.
Japanese exporters have been winners, Moore added. “Their cleaner recovered paper is highly sought after by Chinese mills,” with demand rising by 40 percent in the past year. (This, another conference attendee said, has caused supply and high pricing problems for Japanese mills.)
For American and European exporters, increased demand for recovered fiber from India has helped soak up some of the tonnage that formerly headed to China, said trader Inder Aurora of Mumbai-based Tradecom International Pvt. Ltd.
India produced about 17.5 million metric tons of paper and board in 2018, he said, and it used recovered fiber to produce 65 percent of that volume. Of the 13.5 million metric tons of scrap paper India’s mills consumed in 2018, 7.5 million metric tons (55.6 percent) were imported, he added.
With land for forestry and agro- fibers scarce in India, Aurora said the nation would require imported recovered fiber for some time to come. “I look at it as a major opportunity going forward,” he told the recyclers and traders gathered in Shenzhen.
Aurora said India’s increased import activity started in 2018 because of a “price incentive” caused by the decline in value of mixed paper and some OCC grades on the global market, prompted by China’s tougher inspection regimen. “The volumes of [exported] recovered paper to India will gradually keep going up as the optimal use of installed capacities and the restart of stalled capacities” gets underway, he said. (For more information on opportunities in India, see “India’s growth story” on page 88.)
Dan Cotter, a vice president for CellMark Recycling who is based in the U.S., said recyclers and mill buyers in India face shortages of the old newspapers (ONP) and office paper grades because of the decline in print communication. Therefore, those grades are also less available for export.
Cotter said China’s tougher import restrictions arose in part because of what he called “wish recycling” in U.S. collection programs. He said single-stream programs have resulted in the declining quality of paper bales, and such programs in the U.S. (as well as those in parts of Europe and Australia) may need to change to meet the new standards.
“I’ve seen some pretty horrible stuff shipped,” Cotter said. “Something needed to be done. We in the West need to figure out how to make a better package.”
Mixing it up
More than 2 million metric tons of mixed paper had been going to China annually, but “this has fallen to almost zero,” Moore said. Also, the U.S. market for No. 11 OCC (which consists of corrugated containers lined with either test liner or kraft) has been soft since the restrictions were introduced, he added.
“The price gap has really widened between No. 11 and No. 12 OCC,” Moore said, adding that the premium for No. 12 clean OCC is similar to the prior difference between No. 11 OCC and mixed paper.
Regarding mixed paper, Moore said, “Even before China’s effective ban on imports of it, the grade bordered on chronic oversupply.”
In 2018, the mixed grade sank to below $0 per ton, with some mixed paper facing disposal rather than recycling. However, paper and board makers in North America have begun to respond to the circumstance, Moore said.
Cotter of CellMark Recycling said the year had brought “chaos,” but remarked that “as a trader, chaos offers us opportunities.” He said the chaos also had “made life difficult for our customers and suppliers” and he saw “significant changes coming” to residential collection programs in the U.S., which largely have deployed single-stream systems this decade.
Mumbai-based trader Aurora said China’s tight quality restrictions had provided a “wake-up call to the world.” Recyclers, he said, “should not just talk about recovery rates but [also] talk about how scrap is collected.”
Rahul Kejriwal of New York-based Go Green/Kejriwal called the restrictions “a good decision” by China’s President Xi Jinping. He continued, “I think the last 20 years was a mistake,” adding, “a lot of this paper should not have been made in China” from recovered fiber that was shipped halfway around the world.
Kejriwal said that while media coverage had portrayed America as the loser in China’s scrap restrictions, he disagreed with that narrative and with Cotter’s concern about the single-stream recycling system.
“China is going away as a market in two years. In that time, new capacity in North America and Europe will absorb this fiber—even mixed paper,” Kejriwal said. “America will innovate, research and make adjustments to handle that fiber. They will not change their system to make China happy or to make India happy,” he added.
Regarding the 2018 woes experienced by America’s paper recyclers, Kerjiwal said, “America applauds when someone fails and bounces back; it does not punish failure. It’s a big problem today, but they’ll solve it.”
Tang said the CRRA has met with the Ministry of Ecology and Environment (MEEE) in China to portray the positive role recovered fiber plays in China’s economy and to communicate that “there has been a bottleneck” for papermakers. “The MEEE is considering the impact on our industry,” she told conference attendees.
The labeling of scrap materials as “solid waste” or “foreign garbage” remains a problem, Tang said. “We need to portray the difference between solid waste and recovered paper,” she said of efforts by the CRRA and paper companies.
Echo Xu, a China-based analyst with conference organizer RISI, said China had “restricted imports of recovered paper in both quality and quantity in 2018.” She said in the first three quarters of 2018, “China’s recovered paper import volumes dropped by 47 percent.”
That spells a dramatic difference from 2000 to 2017, when Xu said China’s compound annual growth rate for imported recovered fiber purchases was 3.7 percent. In 2018, however, China was on pace to purchase 36 percent less recovered fiber from the U.S. compared with 2017.
Within China, as imports are restricted, the competition for domestic OCC and scrap paper “will be ever more fierce” leading to 2020, Xu said, when the government intends to ban all recovered fiber imports. This is problematic, she said, estimating that the nation’s OCC collection rate was already 75 percent and could even be as high as 90 percent considering the number of boxes exported from China.
The author is senior editor with the Recycling Today Media Group and can be contacted at email@example.com.
Features - Plastic Recycling Investments
Steve Wong of Hong Kong-based plastics recycling company Fukutomi Co. Ltd. looks for opportunity in Mexico and Haiti.
During a trip to Haiti in January, Steve Wong, who founded and manages Fukutomi Co. Ltd., a Hong Kong-based plastics recycling company, met with Haitian Prime Minister Jean-Henry Céant to discuss developing an economic zone for recycling in the country. Wong says he hopes to start and grow a plastic recycling industry in Haiti as he did in China in the 1980s.
China’s restrictions and outright bans on imports of some recyclables, a trend that has been spreading across other countries in Southeast Asia, and trade tensions between the U.S. and China have led Wong to look for new places to operate his business. He compares the opportunity to operate in Haiti to when he was first starting out in the industry and a developing China opened its economy to international trade, leading to unparalleled growth in the country.
Benefiting from China’s economy and export activity, Wong, who also is executive president of the China Scrap Plastic Association (CSPA), grew his business into a conglomerate with associated companies located around the world.
Over the years, he has become an expert on recycling low-grade plastic scrap with zero or negative value into “much more,” he says. Of course, investments in the right type of sorting equipment are necessary to aid in doing so, Wong says.
However, the altered global recycling market has changed everything.
The changes began with China’s ban on postconsumer plastic scrap imports, followed by restrictions and bans on low-grade scrap imports in other Southeast Asian countries. Additionally, the trade war between the U.S. and China has further hindered recyclers and processors whose businesses had relied heavily on trading plastic scrap.
As it becomes increasingly more difficult and costlier to trade material with China and other countries in Southeast Asia, “recyclers either need to quit the business or look for places they can operate,” says Wong, who has been busy restructuring his businesses and setting up operations in Haiti and Mexico.
More viable solutions
A prominent Vietnam-based nylon recycler, who wishes to remain anonymous, says he almost went out of business because of the import restrictions.
“For the past two years in Vietnam, it’s been on and off again. You can import. You can’t import,” Wong explains. “For long term, I think Vietnam will only allow imports of certain types of high-quality material. It’s the same thing in Malaysia and Thailand. Even if they allow imports, they won’t allow potential waste or low-grade material or material that will contaminate the environment.”
The import bans align with China’s long-term goal to improve the country’s environment and the health of its citizens, and Southeast Asian countries, such as Malaysia, are following China’s lead in banning imports because of environmental and contamination concerns. However, recyclers need consuming markets.
Wong and the nylon recycler, who is a customer of Fukutomi, have formed a joint venture to operate a recycling and processing facility for plastic scrap in Monterrey, Mexico. Equipment is currently being installed at the 60,000-square-foot facility.
The plant will recycle and reprocess nylon and other types of plastic scrap, such as acrylonitrile butadiene styrene (ABS) and polycarbonate (PC), into pellets to be used to manufacture new products.
“In the last few years, more and more factories are being set up in this country instead of the states because of the trade war,” Wong says of Mexico. He adds that the trade war “stopped certain people from processing in the states, especially [if] the goods [were] going to China due to the heavy import duty.”
He says of Mexico, “Over there, we can process without uncertainty of whether we can import or not, and after you process, you can also sell domestically [within North America] to the states, as well as to the Asian market, especially China.”
Locating in Mexico also allows Wong and his partner to recycle material generated in that country. “Over there, there is much more source of material because of the automobile industry and electrical appliance companies,” he says.
Wong says he believes this will be the “trend of the future” as more recyclers within China move away from the traditional import-based recycling system and turn to more sustainable, viable options.
While Wong’s recycling operation in Mexico is a joint venture, over the last few months he also has been looking at the prospect of entering the recycling market in Haiti on his own.
He recently met with the country’s prime minister and other government officials to learn about Haiti’s political and economic history, as well as to discuss the opportunity to develop a special economic zone in the country, where Wong says recyclers would be able to import materials, process and export without paying a duty.
However, Wong doesn’t just want to import and export material. His plan and vision for Haiti includes building a downstream recycling system and developing infrastructure that would bring economic growth to the country.
“I think the main objective for them is to fight the inequality and also poverty,” Wong says of Haitian government officials.
The World Bank says Haiti is the poorest country in the Americas. According to a 2012 household survey (the most recent available), more than 6 million of Haiti’s population of 10.4 million, or 59 percent, live below the national poverty line of $2.41 per day, and more than 2.5 million, or 24 percent, fall below the national extreme poverty line ($1.23 per day).
Historically, Haiti has suffered from political instability and natural disasters. A catastrophic earthquake in 2010 killed 230,000 people, according to the Haitian government, and Hurricane Matthew in 2016 claimed the lives of more than 500 people and left 35,000 people homeless.
“Their poverty rates are quite high compared with other countries in the world,” Wong says. “Also, the infrastructure is not resistant to these natural disasters.”
Wong says he discussed China’s history, growth and the state of the recycling market with Haiti’s prime minister.
“In the ’80s, China brought in the recycling industry,” Wong recalls. “Not only plastic, but [also] metal, cardboard and other materials, to make different kinds of products to compete with the rest of the world. At one time, China was the world’s factory. This is how they started and achieved their growth.”
He says he has reached a stage in the Haitian project where he is “ready to bring in recyclers.”
The first phase of the project will establish a location and funding and develop the infrastructure. While touring parts of Haiti in February, Wong was shown an existing industrial zone, which has access to ports, that he could possibly build on.
“There are a couple of factories over there that make branded sportswear,” Wong says. “They’re also looking for secondary material to increase their recycled content, especially if they committed themselves to using more recycled content by 20 or 50 percent.”
Wong says he is looking to grow the recycling market in Haiti because of “the connection” he has with the people. He also believes Haiti is one of the only places that could follow the same model as China did in the 1980s and be successful.
“These are people I can talk to and feel the enthusiasm they have for the development,” Wong says. “It may take a couple of years to develop the infrastructure, but they are eager to develop with us.”
The author is the digital editor for the Recycling Today Media Group and can be reached at firstname.lastname@example.org.
India’s growth story
Features - India Market Outlook
With China’s doors closed to imports of many recyclables, India has imported slightly more nonferrous and paper scrap recently.
Not a single family of scrap commodities was immune to the restrictions and bans implemented by China in 2018. Certain types of ferrous, nonferrous, paper and plastic scrap all needed to find alternative markets to some degree.
“The good thing about the China problem is that it did not happen overnight,” says Sunil Bagaria, president of GDB International, New Brunswick, New Jersey. “Progressively, they implemented a series of steps. That was enough for anybody to understand the China problem is a permanent problem.”
With that door closing to some U.S. scrap imports, others have opened. India serves as one of the growing countries for U.S. recyclers looking for export markets, specifically for nonferrous and paper scrap.
Dhawal Shah, director at Metco Marketing Pvt. Ltd., based in Mumbai, says India’s consumption of scrap has grown in recent years.
“The overall volumes that we have from last year, imports as well as domestic sources, [went] up,” Shah says. “After China put controls on their policy, I reckon less materials are going there. On the other hand, there has been an uptick in Indian production of secondary nonferrous metals and consumption levels thereof since last year.”
Shah says India is currently the fastest growing major economy in the world, expanding at a rate of 7.5 percent. Therefore, the volume of scrap the country generates and consumes has the potential to grow in the next few years. He adds, “Of course, China may remain the dominating force; however, India is making its own growth story. If [China] slows down their buying, India becomes the natural choice for American companies to plan to sell scrap.”
Need for nonferrous
Demand for ferrous scrap has remained steady in India, and demand for nonferrous scrap has increased. Sanjay Mehta, director at MTC Business Pvt. Ltd., Mumbai, and president of the Material Recycling Association of India (MRAI), also based in Mumbai, says he has noticed a great deal of new nonferrous activity in India.
“Nonferrous scrap metal imports have increased in the past 10 years,” he says. “In nonferrous, the quantity has gone up. There are more buyers of that kind of scrap since China’s not [been] in the market” from the last seven to eight months.
Ferrous scrap, on the other hand, faces more international competition. Mehta adds, “In the ferrous market, there are other competitors [for scrap], like Bangladesh, Pakistan or Indonesia.”
Shah says India is the second biggest steel producer in the world, with ferrous scrap being used to produce more than 50 percent of its total steel output.
“The secondary nonferrous sector is also growing at about 10 percent year over year,” he says.
Shah says aluminum is the largest nonferrous scrap import to India, followed by lead, brass and copper.
Mehta says India imports about 85 percent of the aluminum scrap and about 70 percent of the brass scrap it needs.
In recent years, Mehta says India has seen new activity with heavies and zorba imports. He adds that imported nonferrous scrap also tends to be more competitive than India’s domestically collected nonferrous material.
“With nonferrous, we’re largely dependent on the international market—maybe 70 percent dependency,” he says. “For ferrous, it’s hardly 10 to 15 percent of overall total secondary sector production of steel,” he says of scrap imports.
“In the years to come, the recycling industry needs a major shift—a seismic shift—in the way that we take care of our scrap.” – Sunil Bagaria, GDB International
Looking to 2019 and 2020, Shah says he thinks India will continue to steadily increase nonferrous scrap imports.
“China does play an important role,” Shah says. “If there’s a turn in terms of China relaxing its norms in due course, the scrap flows may get tweaked again. However, exporters now may look at investing into other long-term potential markets like India—to deleverage and not get overdependent on one market.
“There are a lot of potential events that we don’t know yet—only time will tell. But I think the secondary industry [for nonferrous] in India will continue to grow this year and next year,” he adds.
Paper and plastics
India also imported more recovered fiber in the past year. In fact, according to the Indian Paper Manufacturers Association, New Delhi, imports of paper and paperboard into India steadily increased over the last seven years at a compound annual growth rate (CAGR) of 16.11 percent in value terms and 18.15 percent in volume terms.
Dan Gee, senior associate at Atlanta-based Moore & Associates, says India is among the many countries that have received more recovered fiber imports since China placed restrictions on imports of this material in 2018. Other such nations include Indonesia, Vietnam, South Korea, Thailand, Taiwan, Laos, Philippines and Malaysia.
He adds that India is the biggest consumer of recovered fiber imports on this list of nations, but Gee says the country doesn’t consume anywhere near the amount of recovered fiber that China had consumed.
“The China import situation has really fast-forwarded development and growth in pretty unprecedented figures,” he says. “China is so big that it has consumed over the past 30 years about one-third of the world’s recovered paper.”
While in the near future India might not fill the hole for recovered paper that China left in the market, at the 2018 RISI International Recycled Fiber and Containerboard Conference in Shenzhen, China, Inder Aurora of Mumbai-based Tradecom International Pvt. Ltd. said he is hopeful India can “become the next China” over the next 20 to 30 years.
During the conference, Aurora said India produced about 17.5 million metric tons of paper and board in 2018, and it used recovered fiber to produce 65 percent of that volume. Of the 13.5 million metric tons of scrap paper consumed by India’s mills in 2018, 7.5 million metric tons (about 55.6 percent) were imported.
He said India’s import activity in 2018 increased because of a “price incentive” caused by the declining value of mixed paper and some old corrugated container (OCC) grades on the global market, prompted by China’s stricter standards for recovered fiber imports. He said, “The volumes of [exported] recovered paper to India will gradually keep going up as the optimal use of installed capacities and the restart of stalled capacities” gets underway.
Bagaria notes that “it’s a good thing” that India has stepped up to import some of the recovered fiber—specifically some of the lower quality fiber that had previously gone to China.
“Otherwise,” he adds, “a lot of this fiber would have ended up in a landfill in the U.S.”
While Bagaria says India could serve as a decent export market for recovered fiber grades, he says the country offers less opportunity for plastic scrap.
“In India, you can ship plastic scrap to very few companies,” he explains. “Only very clean grades can go to India.”
Bagaria says he thinks the best solution for plastic scrap generated in the U.S. is to recycle it domestically. “The only permanent solution is to encourage recycling domestically.”
Mehta estimates India achieved about a 30 percent recycling rate in recent years.
“Recycling activity in India is not organized yet in comparison with the international market,” he adds.
Yet, Mehta says he is hopeful India’s recycling rate will improve soon. Late last summer, MRAI discussed plans for a National Recycling Policy at the Sustainable Growth Through Recycling: Policy Prescriptions conference Aug. 6, 2018, in New Delhi.
“[While] several policies, acts and rules have been framed by the central government and its departments, an overarching National Material Recycling Policy that would holistically address material recycling has not yet been framed,” writes Amar Singh, MRAI secretary general.
In an effort to understand best practices used in various segments of the global recycling industry, including country-specific legislation and rules, MRAI invited international experts and industry association leaders to share this information at its Sustainable Growth Through Recycling: Policy Prescriptions conference.
Mehta says MRAI has provided a great deal of input and suggestions to NITI Aayog (National Institution for Transforming India), the think-tank of India, which since has drafted a National Material Recycling Policy for the government of India. He says this policy has received some government support and it could be introduced before India’s general election in May 2019.
“We are sure that the government will introduce this before the election,” Mehta says. “We have all worked hard on this policy. The policy is India’s responsibility to recycle everything—paper, plastic, metal—and the ability to send that material to organized recyclers and separate it properly so it doesn’t go to landfills.”
Although India imports ferrous, nonferrous and paper scrap today, it might import less of these materials in the future if the country adopts a nationwide recycling policy.
Mehta says he is hopeful that, if adopted, the National Recycling Policy would help India to become self- sufficient and much less dependent on scrap imports in the future. “We are hoping in 10 years there will be minimized imports.”
In the long run, Bagaria says this policy—as well as any other recycling policies developed overseas—could be a good thing for recycling on a global level in general.
“In the years to come, the recycling industry needs a major shift—a seismic shift—in the way that we take care of our scrap,” he says. “It will not go as much overseas. We will have to wake up and find ways to use it domestically and recycle domestically. That’s the need of the hour.”
The author is managing editor of Recycling Today and can be contacted at email@example.com.