ORLANDO, FLA. — Heightened inspection procedures at China's ports are causing delays and confusion for scrap exporters.
Talk of China's so-called "Operation Green Fence" could be heard around presentation rooms, exhibitor booths and lunch tables at the Institute of Scrap Recycling Industries Inc.'s annual Convention & Exposition in Orlando earlier this month. Exporters of paper, plastic and metal scrap reported expensive delays in their shipments to China, and more shipments turned away in customs.
The new measures, initiated by China's new president, Xi Jinping, are intended to curb the amount of solid waste contamination the country imports. It involves stricter enforcement of quality requirements for imported recovered materials, but no new legislation.
"Many customs officers were not doing their work properly and some hazardous waste and rubbish materials had been recently found in containers at some ports," Francis Veys, director general of the Bureau of International Recycling, wrote in an email to Waste & Recycling News. "The customs authorities are opening more containers and if they find any materials which do not meet the Chinese quality requirements they return the whole lot to the suppliers."
Peter Wang, CEO of America Chung Nam, the primary recovered paper supplier to Nine Dragons Paper in China, warned of tougher import restrictions during a presentation at the Residential Recycling Conference held in March in Chicago.
"If China customs found a syringe, even if it's just one, in a bale of plastic, it's considered medical waste and the whole shipment would get rejected," he said. "And in paper, if they see too much plastic in the paper, also that could actually trigger a rejection in customs as well. And the cargo would pretty much have to go back to the origin point."
The pertinent legislation was introduced in 2006 and confirmed in 2010. China's government mandates that at least 3 percent of containers be inspected, but customs agents may open "up to 100 percent if they feel there is any problem with the shipment," Wang said.
Initiatives to improve communication between ports and centralize information are also planned.
The Bureau of International Recycling reported several exporters from the U.S. and worldwide had suspended shipments to China in light of customs tie-ups.
Scrap exporters and industry groups alike are scrambling to learn what impact the new procedures will have on business. Some reports indicate the crackdown will end in November; others speculate the initiative could be the beginning of progressively tighter controls on China's imports.
The matter is complicated by the opportunity for what one industry expert called "subjective decisions" by customs officials.
Russ DeLozier, director of sustainability for J&J Industries, suggested the rules might be a ploy to get better prices for scrap materials.
"When I see some of these green regulations, my skepticism comes out to say, how much is gamesmanship?" he said. "Every single time, in times I've traded with [Chinese importers] and I've seen them pull out regulations, I've ultimately seen my prices go down ... and I'm certain, after my eyes have seen what had happened, that they'd paid off officials. I'm certain of that."
DeLozier emphasized the value of actually visiting China to better understand business practices there.
"China's different, and if we think that when we're trading with China, we're trading with a company that's similar in values to ours, we're totally coming to the table blindfolded," he said.
U.S. scrap exporters should ensure shipments bound for China are totally clean and make themselves available to inspectors before loads are delivered, but still expect delays, Xavier Cronin of PetroChem Wire said during a presentation at the ISRI Convention & Exposition.
"From what we're hearing about the inspections, loads being turned back, you are going to see less material getting to China, at least for now," Cronin said.