Thursday 1 March 2018

Impact from China's Plastic Scrap Ban

Information Compiled for Internal Newsletter Circulation

Plastic recycling is the process of recovering scrap or waste plastic and reprocessing the material into useful products. Plastic recycling includes taking any type of plastic, sorting it into different polymers and then chipping it and then melting it down into pellets.  Soft plastics such as polyethylene film and bags can also be recycled. 


Polyethylene terephthalate (PET or PETE) containers are sorted into different color fractions are washed (Non-PET fractions such as caps and labels are removed) and crushed. The clean flake is dried before further treatment can take place e.g. melt filtering and pelletising or various treatments to produce food-contact-approved recycled PET (RPET). Other use for this recycled PET is created by spinning the PET flakes into thread and yarn. High-density polyethylene (HDPE) goes through the similar process to produce durable plastic products such as tables, benches and plastic stationary.

In July 2017, China has notified to the WTO its plans to stop accepting plastic scraps and waste from other countries by end of 2017.This is part of its initiative to clean up its scrap recycling industry which accounts for 51% of world’s plastic scrap in 2016.

The Institute of Scrap Recycling Industries Inc estimated the ban to greatly impact US’s recycling industry which supports 155,000 jobs and in 2016 alone exported US$ 5.6 billion of scrap to China. In January 2018, without anywhere to unload the plastic scrap, municipalities in the USA have stopped collecting certain types of plastic because the USA is only able to process 3.5 tonnes of plastic scrap while 775 tonnes of scrap used to be exported to China.

Streets in the United Kingdom (U.K.) began to fill with plastic waste as recycling facilities in Europe did not have the necessary capacity to process the waste and Europe has been a major export with 87% of its plastic exported to China.

As the U.K. begin stockpiling its plastic scrap, EU’s Plastic Strategy in January has committed to ensure all plastic in Europe will be recyclable by 2030 and the European Commission has hinted on introducing a plastic tax. While Australia has also begun stockpiling its plastic scrap, New Zealand has conceded that the ban has created challenges and they expect to turn to Indonesia for recycling needs. Japan meanwhile has begun providing subsidies on equipment for plastics recycling companies to turn bottles and trays into pellet before sending to other countries for recycling.

The new policy would either reroute scraps to other countries or major exporting countries have to handle the scrap internally. In January, Chinese plastic maker Hong Sheng Plastic Industry has obtained its permit in Batam Free Trade Zone Authority (Indonesia) to invest US$ 4 million producing plastic pellets from scrap and exporting to China. Ireland-based company Panda has announced plans to invest US$ 20 million building a plastics recycling facility in the U.K. processing mainly LDPE scrap from Ireland and U.K. Newly formed Millville Plastics In the U.S. will develop a $20 million plastics recycling facility in New Jersey to process PET, HDPE, and PP sourced domestically and abroad supplying to manufacturers of sheet and fiber-grade PET, FDA and non-FDA-sanctioned applications. 

As China begin importing new plastic to replace the recycled scrap, US chemical maker DowDuPont is predicting the US exports of common plastic to quintuple by 2020 as China’s ban could change 2% of recycled global polyethylene plastics supply to new materials. Effects of the ban are already felt with China’s imports of high quality virgin polyethylene increasing 19% in 2017 while an 11% drop was noted for scrap polyethylene imports.

A study in 2007 on the recycling trends in the plastics manufacturing and recycling companies in Malaysia revealed the electrical and electronics sector is the sector that consume the most plastic materials and poly-olefins polyethylene (10%) and polypropylene have the highest consumption rate among the resin types follow by ABS-28%, PP-27%, PS-20%, other materials such nylon and acrylic 11%, PE-10% and PC-4%.
Due to cost saving, local manufacturing companies consume almost 80% of recycled materials and 20% of these companies have their own in-house recycling process. Medium scale industries are also consuming more recycled materials compared to large and small scale industry.

Malaysia should take advantage of availability of raw materials to export high quality resins to China to improve Malaysia’s balance of trade rather than solely relying on Chinese investors to set up low value recycling plants in Malaysia because Brussels-based Bureau of International Recycling estimated Malaysia’s plastic scrap imports for 2017 jumped 75% in one year to 450,000 – 500,000 tonnes.

Too much importation of plastic scrap to support the recycling activities will lead to destruction of local ecosystems and affect the health of nearby residents as experienced by China prior to the ban. Recycling factories in Guiyu, a small town in China’s Guangdong Province produced toxic during the recycling process seeping in to water supply and poisoned local residents with lead poisoning from electronic parts in the scrap.

As a result of too many recycling activities due to the increased in import of plastic waste, more wastage of resources will be created due to certain recycling factories’ low-efficiency production methods because plastic recycling requires a large amount of water, energy and human labor.

China’s ban on import of scraps might have a positive impact globally for recyclables. Firstly, with a drop in high quality plastics imports, domestic players have to scale up the quality of plastic supply while sourcing for refined recycled materials abroad as China will only import processed recycled materials and not scraps. Exporting countries are also forced to implement measures to cut down their plastic consumption and increase their recycling facilities.
To truly solve these problems, we must first change our consumption behavior and business practices. Businesses should adopt techniques that employ efficient production techniques or reduce excess packaging.

U.K. has been enforcing a plastic bag tax since 2015 reducing 9 billion bags or 83% out of the circulation and in January enforcing the ban on plastic microbeads found in personal care products. In order to curb single-use, non-recycle friendly coffee cups, Starbucks and environmental campaign charity Hubbub has announced a test-pilot to charge five pence extra to 20 stores in central London in February to test its customers’ behavior. Reusable cups will be promoted in favor of the existing cups which just 0.25% of cups are recycled and 500,000 are used every day.