PPRCE 2019: Uneven scales

The plastic and paper recycling sectors continue to cope with changes brought out about by China’s government putting restrictions in place that hamper the ability of its manufacturers to access global paper and plastic scrap markets. Responses from other nations are now sparking further changes to global markets, according to presenters at the 2019 Paper & Plastics Recycling Conference Europe, held in Barcelona in early November.

Adina Renee Adler of the Washington-based Institute of Scrap Recycling Industries (ISRI) says that organization’s communication efforts will continue to revolve around the notion that “recyclables are not waste; they have value.” Stated Adler, “It’s not us [recyclers] dumping materials in another country.”

Adler remarked that the United States, like Europe, has a surplus of scrap materials. She said globally some 800 million metric tons of recyclable materials are collected annually, and 180 million metric tons of that total (22.5 percent) is traded across a national border.

China’s government has roiled scrap markets with measures that many observers see as protectionist, and it may also be playing a role in spreading such policies to nations in Southeast Asia. Adler said another concern arising out of China is its government’s apparent effort to replace North American and European product definitions with its own set of standards, though it is not clear if scrap standards are a part of the initiative.

At the same time, efforts by Basel Convention signatory nations to restrict the cross-border sale of plastic scrap could affect the free trade that has traditionally characterized secondary commodity markets. The end result, said Adler, could be that Asian countries beyond China will be “cutting off access to valuable scrap products just when they need them.” Globally, the scrap market supply-demand imbalance could be severe, she added.

Simon Ellin of The Recycling Association, based in the United Kingdom, pointed to Indonesia as a nation that, on the recovered fiber side, has developed an “ad hoc” quality standard that could impact the ability of mills there to buy scrap paper and board from overseas. India, likewise, has announced tightening standards on the way, he said.

As the Chinese government suddenly imposed its quality standards, Ellin said recyclers in the U.K. and elsewhere were “asleep at the wheel.” Although Ellin expressed admiration at the ability of European recyclers to meet tighter restrictions, he also questioned the appropriateness of ultra-low contamination levels imposed on overseas suppliers. “Does China collect material that is 0.5 percent or less contaminated?” he asked.

Amparo Pérez of Spain-based FCC Environment Services said several of that company’s operating divisions are coping with regulations and trade barriers stemming from China and elsewhere. She said FCC’s secondary commodities exports to China so far in 2019 are down by 90 percent compared to some previous years. She said Spain in total is sending 48 percent less recovered fiber to China in 2019.

The resulting “collapse” in paper and plastic scrap prices, said Pérez, is drastically affecting the municipal recycling markets FCC serves in Spain, the U.K., the U.S. and elsewhere. “Low commodity prices are starting to harm some recycling programs,” she commented.

FCC also has energy recovery outlets for some materials, said Pérez, and one bright spot she sees on the horizon is additional recycled-content board mill capacity in Europe (some 6 million to 8 million tons per year) and in Africa (just beginning to emerge).

On the plastics front, Clarissa Morawski of Brussels-based Reloop said EU directives have pushed increased recycling collection in Europe, but she described many aspects of EU plastic policy as having “become an emotional issue.”

The way plastic recycling will be measured is further tightening in Europe (so residuals collected are not counted), and plastic is being banned for use in many items. The result ideally will be more “clean material” collected in the EU, said Morawski, which (again, ideally) will be wanted by retailers and brand owners in Europe who have pledged to use recycled-content plastics.

The 2019 Paper & Plastics Recycling Conference Europe was Nov. 5-6 in Barcelona, Spain. The event is organized by Recycling Today Events.