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November 09, 2017 01:00 AM

Custom Polymers waiting to see how National Sword and NAFTA impact recycling

Jim Johnson
Staff Writer
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    Michael A. Marcotte
    Carlos Lotero, Houston Operations Manager, for Custom Polymers Inc., at Plastimagen,2017.

    Mexico City — For Carlos Lotero, coming to Plastimagen is like coming home.

    The Houston operations manager for Custom Polymers Inc., a plastics recycler, has been attending the trade show since its inception more than 20 years ago.

    He views it as an important connection to customers and suppliers in Mexico and all of Latin America.

    Having a focus on Mexico for so long has allowed Lotero to build lasting business relationships, a key to doing business in this market, he believes. His work in reprocessing, import and export of recycled plastics also has given him a global view.

    But when it comes to the ultimate impact of National Sword, the Chinese government's crackdown on scrap imports, including plastics, questions still remain, he said.

    "The one thing that has affected us the most is the new National Sword," Lotero said in an interview on the Plastimagen show floor in Mexico City. "We have been very anxious about what we buy for China. We are trying to be more sophisticated."

    With details still emerging from China about the impact of the quality crackdown, Custom Polymers is making sure it sends only high-quality recycled plastic to that market.

    "We try to be specific on items that we know are sellable so we don't lose money bringing it back to the states. We have become more careful," Lotero said.

    One thing Lotero knows for sure: China is not going to be a big player when it comes to importing recycled plastics. But exactly how that plays out remains to be seen.

    "There still a lot of things that have to be heard. There's still a lot of things that have to be described. Any container that is contaminated, we don't ship it to China," he said.

    "We're trying to keep our ears open and see," Lotero said. "A lot of companies in Mexico, they're being very careful, too, in buying and selling.

    "In the meantime, we try to study new ways to produce better scrap to sell it to domestic [customers] and to Latin America. The Latin America market is very strong. Mexico, for instance, is very strong for us. It's one of our best allies in the growth of the company. It's always been. We sell a lot of scrap to Mexico. We buy a lot of scrap from Mexico as well."

    The Houston operations headed by Lotero is part of the larger Charlotte, N.C.-based Custom Polymers. The Houston location, which grinds and bales plastics, and Lotero's long-time ties to the Mexico market also has allowed him to gain an up-close-and-personal view of the North America Free Trade Agreement.

    NAFTA, he said, has had a positive impact on the plastics recycling business by limiting tariffs on shipments between countries, for example.

    But Lotero also understands there is a need to reexamine the trade agreement to ensure it is working for each country involved.

    "A lot of companies in Mexico right now, they are being very careful, too, buying and selling," he said. "They don't know what the new regulations of NAFTA are going to be. They don't know until next year. We're keeping our fingers crossed that it's only going to be something that benefits all three countries, Canada, the United States and Mexico," he said.

    Lotero said there needs to be an update of the NAFTA agreement for today's business conditions.

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