China's imports of plastics recycling scrap are likely to "nosedive" to less than half of normal levels next year in the wake of Beijing's strict ban on overseas waste materials, according to the Brussels-based industry group the Bureau of International Recycling.
In an Oct. 19 statement, BIR offered specific assessments of how China's ban, first announced in July, was playing out and would likely impact markets into next year.
"Imports into China could fall to 30-40 percent of normal levels next year, leaving overseas suppliers to find alternative outlets for perhaps 6 [million] or 7 million tons of plastics scrap," said Surendra Borad Patawari, head of the BIR Plastics Committee and an executive at Antwerp, Belgium recycler Gemini Corporation NV.
"China and Hong Kong together imported 10.2 million tons of plastics scrap in 2016 — but this figure is likely to nosedive next year," he said.
The group issued the statement after an industry meeting in India in mid-October, where it said it received a report from the China Scrap Plastics Association that government officials in China have confirmed that they will continue to issue import licenses in 2018.
But BIR said that licenses will only be renewed to Chinese recycling companies with "clean records and full compliance with environmental regulations."
The crackdown on licenses has been a key administrative part of China's new regulations, and industry officials have been watching closely to see how it would be implemented.
BIR, which represents recycling trade associations in 70 countries and includes 800 companies, said the Chinese rules have had a dramatic impact on pricing.
"The value of certain materials shipped in containers have crashed to zero — and beyond — in some instances," BIR said. "Conversely, plastic scrap prices within China have soared as much as 20-30 percent on the back of shortages."
There's evidence that the Chinese ban is bolstering local markets, BIR said.
The association said, for example, that Mahmoud Al Sharif of the UAE-based Sharif Group of Cos. reported that "many of his region's exporters have found alternative markets to China and that local scrap prices have increased of late following improved prime values."
Speakers from India reported that the Chinese ban is likely to boost their country's recycling rate above its current 22 percent.
Indian companies also said the country needed to do more recycling in the "formal" sector, rather than 80 percent of polyethylene and polypropylene that's currently recycled in informal, unregistered companies there.
BIR estimated that India only imports about 150,000 metric tons of plastic each year, or less than 2 percent of what China and Hong Kong import.
And an executive with a French recycling company said China's ban has already shifted recycling of some low density PE film collected in Europe from Asia to processing facilities in Portugal and Spain.
