International trading in plastic recyclables is a business some people will work 18-hour days to be a part of, while others in the brokerage business completely shun it. For those shipping plastics overseas, business couldn't be better. But other brokers can sell all their best-quality recycled resins in the United States.
Roger Finnell, president of broker Prime Meridian Co. in Santa Barbara, Calif., has bought American waste plastic for sale in the Orient for six years. He deals with the six largest-volume importers of plastics into the Asian community. He markets plastics from across the United States to those customers, going through Western U.S. ports.
The largest overseas customers send out as many as 400 44,000-pound oceangoing shipping containers a month of waste, leftover, or regrind plastics, in peak months. Someone doing well in the business sends out 50-60 per month, he said.
``The overseas community used to take more contaminated material up until about six months ago. They are tending toward cleaner material now than in the past.
``Generally, overseas companies purchase lower-cost scrap materials. They intend to add value using lower-cost labor and probably older, lower output machinery. Domestic users prefer `ready to run' materials that require little manual labor.
``Overseas markets also provide alternative uses for plastic materials,'' he added. In the United States, ``these practices would rarely be considered and possibly would not be legal.''
Although he won't reveal his volume or revenues, Finnell said, ``There are many, many Asian buyers. In most cases, overseas purchasers pay a lower price than a domestic buyer, but they will pay cash. In the [high density polyethylene] and PET soda bottle categories, they will match domestic purchasing, and still pay cash,'' he said.
On the West Coast, where shipping costs to the Orient are lowest, ``We have an enormous amount of buying pressure because overseas buyers are aggressively wanting waste plastics to add value. They want to buy it in the least-expensive form with the least amount of contamination that allows them to reprocess it in a low-labor-cost environment.''
Even though customers pay in cash, if the plastic is not as sampled, U.S. waste plastics marketers will take a hit and the overseas customer may seek material elsewhere, Finnell said.
And late last year, the ``precipitous market decline with material already shipped caused claims to come out of the woodwork and caused every trader that I know to lose money on at least one transaction through a claim.''
But Kevin Copeland, vice president of American Plastics Inc. of Akron, Ohio, said, ``The export market is down. The smaller exporting companies will dispute that, because they deal in specific lots and the specialized nature of their exporting business is growing. But in general, it's down.
``It will pick up once the price of resin in the United States drops. Then you'll see an upswing in the international market,'' he said.
``I get calls from 15 export brokers a week wanting to buy recycled resin. You know they are international brokers because they want to buy lots of truckloads at a time,'' Copeland said.
Why is he in business with the Far East? There are advantages to the export market, Copeland said.
``First, you get your money up front. And overseas buyers will take lower-end quality - in part because hand labor allows them to clean it and second because their standards for resin are so much lower than those of the United States.''
Not everyone is dealing with the Far East now. Robert Waxman, president of the Resource Recov-ery Division of Phillip Environ-mental Group in Hamilton, Ontar-io, runs an operation that pro-cesses 12 million to 14 million pounds of mostly PVC taken from wire and cable.
``The international market [in recycled materials] will grow 10-20 percent per year. With respect to wire and cable, it will occur in Indonesia, the Pacific Rim and China,'' Waxman said.
Then there are those who look at the international market with a jaundiced eye. Don Brown, project manager, extrusion compounds and resins for Wexford International Inc. Mendham, N.J. noted, ``Most people who are doing the recycling in the United States are keeping it to themselves or are selling it to people with whom they have contracts.''
Wexford, a reseller, handles 100 million pounds of domestic re-grind, off-color, miscompounded or other flawed PVC per year.
``The true plant scrap gets sent overseas,'' Brown said. ``It's a great outlet - we're not filling up our landfills anymore. There is not much good recycled material [that] leaves the states anymore. If it's of any quality at all, it stays in the United States.''
