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March 14, 2019 02:00 AM

Recyclers invest in US processing in wake of National Sword

Jim Johnson
Staff Writer
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    Jim Johnson
    Sunil Bagaria, president of New Jersey recycler GDB International Inc., said GDB invested in its own equipment after China launched National Sword.

    National Harbor, Md. — GDB International Inc. was completely happy with simply baling and exporting recycled plastic to China for further processing for years.

    But the New Brunswick, N.J.-based company said that country's ban on scrap imports of all types caused the recycler to reassess its market strategy.

    It was either reassess or go out of business, President Sunil Bagaria said.

    When China swung its National Sword — the name of its effort to essentially ban imports of plastic and other recyclables — GDB decided to make an investment in its own equipment to process recycled film and pelletize the resin for sale in the United States.

    "There is an opportunity. The ban that is taking place is an opportunity for the plastics industry in America," he said at the Plastics Recycling Conference and Trade Show, held in National Harbor near Washington, D.C.

    The 14th annual show attracted some 2,000 attendees associated with plastics recycling and is the first to take place after its recent sale to the Association of Plastic Recyclers, a trade group, by Resource Recycling Inc. of Portland, Ore.

    "It's important to seize the opportunity," Bagaria said.

    After China imposed import restrictions, plastic recycling processing migrated to other countries in Southeast Asia, but those countries also are now restricting imports after dealing with problems created by the influx of material.

    And that, Bagaria said, should be proof that countries that generate used plastics need to be handle their own processing and reuse.

    "The long-lasting solution is the society that produces the scrap really must be responsible," he said.

    U.S. recyclers long relied on exports to handle much of the used plastic the country generated, but having that outlet caused the U.S. plastic recycling infrastructure to lag behind the overall need, he said.

    And while the plastics industry has long touted the value of its recycled material, shipping large quantities of the material offshore sent the wrong message to customers, he said.

    "If it is a valuable material for other countries, then it is a valuable material for our country," he said.

    Bagaria is out to prove just that by investing more than $1 million on three recycled film processing lines in New Brunswick.

    "There is more money to be made by selling the pellets to them than by selling the scrap," he said.

    Bagaria described National Sword as the shock his company needed to change its business model, even though that has been a challenge. "Don't get me wrong, this is not an easy thing to do."

    Jim Johnson

    Keith Ristau, CEO of Far West Recycling.

    On the other side of the U.S., Far West Recycling of Portland, Ore., handles a wide variety of recyclables, including about 1,250 tons of various resins each month.

    Like GDB, Far West heavily relied on Asia to process that material. CEO Keith Ristau said he understands why China cracked down on imports after complaining about contaminated material.

    "I can't blame them for that at all. It's a good way to go. It was hard, but we fought through it," he said.

    Far West took steps to improve the quality of its recycled plastic bales by slowing the speed of its material recovery facility to make the equipment more effective. The company also hired additional workers to pick contaminates off the recycling line.

    The moves have created higher-quality bales that are now being sold to domestic plastic recyclers that have historically tolerated less contamination compared with buyers in Asia. Prior to the implementation of National Sword, a majority of the company's plastic was exported to China. That material now is all used in the United States, Ristau said.

    Prior to the bans, for example, the company's bales were about 90 percent PET bottles. By slowing the sorting line and adding more manual labor, the company's bales are about 98 percent PET bottles.

    "I believe National Sword had a positive influence on the recycling industry by forcing all of us to produce a good quality product," Ristau said.

    Creating more demand for recycled resin is a key to increasing plastic recycling in the United States, Bagaria said. "This is the biggest challenge I see going forward," he said. "The demand should outpace the supply."

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