Published On: Mon, Jun 6th, 2016

The rocky world of plastics scrap exports

Asia: Not for the first time, developments in China and India are occupying the minds of the world’s leading plastics scrap exporters.

Dr Steve Wong, executive president of the China Scrap Plastics Association, confirms that Beijing has been debating reforms to its solid waste import regulations as part of its clampdown on industrial pollution, including a ban on imports of waste plastics. ‘The ultimate goal is to allow imports of recycled raw materials directly for the production of goods and without prior processing,’ he states.

Plastic Recycling

The rocky world of plastics scrap exports

Such a move would court ‘controversy’ as many Chinese operations – and thus thousands of jobs – are reliant on imported plastic scrap. ‘The resulting shortage in raw materials supply would entail higher product costs and affect China’s export competitiveness,’ Wong points out.

Representatives of China’s plastic recycling industry will seek a compromise with government officials – possibly involving a revision of the import list and/or an extended timetable for implementation of the restrictions, according to Wong.

In the meantime, some exporters of plastic scrap have already diverted their attention to other markets in South East Asia such as Malaysia, Indonesia and Vietnam ‘as some of the end-user manufacturers have relocated their production bases to these countries owing to escalating production costs in China’, says Wong. Some recyclers have also set up processing plants in South East Asia recently, he adds.

Meanwhile, the Indian government’s ban on imports of solid plastic waste, including PET bottles, could affect over 10 000 people who work at recycling units which rely on plastic scrap purchased from abroad, according to Surendra Borad Patawari of Gemini Corp., chairman of the BIR plastics committee. Some 30 companies located within Special Economic Zones (SEZs) and 100% Export Oriented Units (EOUs) had been allowed to import plastic scrap into India.

‘This ban will put pressure on other Asian countries to absorb the recycling material that would normally have been earmarked for India,’ Borad observes. ‘Likewise, the European market would be flooded with additional recycling material, putting pressure on prices.’