22 Nov In a well-developed paragraph, reflect on the significance of what you read in the article you were assigned. Reflect on the information you learned from the article and any questions y
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Works Cited Toloken, Steve. “China’s Ban Prompts US Recycling Investment.” Plastics News, vol. 28, no. 30, Oct. 2017, p.
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China's ban prompts US recycling investment China's ban on imports of recycled material is pushing more U.S. companies to invest in new recycling capacity.
Trading and consulting firm GDB International Inc., for example, plans "very, very sizable investments" to set up factories in New Jersey and Ohio to make pellets from recycled plastics that it previously exported to China.
As well, San Francisco-based Recology, which operates waste management systems for more than 700,000 homes and 100,000 business on the West Coast, is seriously exploring setting up its first plastics factories, which would include extrusion lines to make pellets.
Both companies were interviewed at a Sept. 26 open house at Austrian recycling equipment maker Erema Engineering Recycling Maschinen und Anlagen GmbH's technical center in Ipswich.
From conversations there and in other interviews, it's clear the industry is still absorbing China's summer shock: Beijing's July announcement of a ban on imports of many types of scrap materials, including plastics.
GDB said it had been exporting to China about 40 percent of the 16.5 million pounds of plastics it buys each month. But with the strict ban being phased in, the company is moving from trading and consulting into actual recycling.
"Now it makes sense for us. Let's set up real recycling lines, processing lines and make those pellets so they can be either sold to an American manufacturer or sold overseas," said Sunil Bagaria, president of
New Brunswick, N.J.-based GDB.
He declined to give many details but said the company plans to have its recycling factories in New Jersey and Ohio operating late this year or early 2018: "It is a very, very sizable investment."
"If those two projects become successful, then we will put one in Wisconsin," Bagaria said.
Erema CEO Manfred Hackl said his company expects to sell more recycling equipment in the United States and Europe because of China's ban on imports, including to traders that are shifting their business model.
He said Erema, which calls itself the largest maker of plastics recycling equipment in the world, also believes that, over time, the ban will boost its sales in China as demand grows for better-quality equipment to handle domestically collected material.
"Until this ban, China took a lot of material," he said. "We feel already some movement."
While he noted a shift, Hackl also cautioned it could take several years for the impact to be fully felt in Erema's order book.
Other recyclers active in China and the U.S. expect more investment in the United States — and fairly quickly.
"I do believe there will be a lot of production that will occur in the U.S. very soon," said Kathy Xuan, CEO of Parc Corp., a plastics recycling company in Romeoville, Ill., and a board member of the recycling committee of the China Plastics Processing Industry Association.
Parc, which also has a plant in China's Shandong province, is working with Chinese companies to set up recycling factories in the United States to repelletize post-consumer PET and to recycle agricultural film.
She said demand within China for recycled pellets remains as strong as before the ban and, in some ways, is more intense as China's large manufacturing industry scrambles for materials they previously could have bought from Chinese recyclers that reprocessed imported scrap.
A 'very hungry' market
"The market is still hungry, very hungry," she said.
Estimates from the China's government provided by Chinese recyclers show that imports of both recycled polyethylene and polypropylene scrap are likely to drop by almost 50 percent for the five months from August to December, compared with the same period in 2016.
Chinese scrap PE imports, for example, are expected to fall from about 1.5 billion pounds to 880 million pounds in the five-month period.
Any Chinese cutbacks are felt globally, with industry statistics showing that China has generally consumed about half of the global trade in recycled plastics over the last decade.
While China is restricting imports of mostly unprocessed scrap, industry officials said it's not limiting imports of recycled materials that have been turned back into resin pellets, as companies like Parc and GDB plan to manufacture.
The Chinese ban has reinforced to the waste management firm Recology that the global market is shifting.
"It makes us feel that it's getting more and more important to try to recycle in the United States," said Jesse Chu, a senior plastics engineering technologist attending the Erema open house.
"We haven't made any decision to finalize yet," Chu said. "But we have been doing trials with quite a few companies. We are looking at how we can make pellets usable by the final customer."
Even with the China ban stimulating interest in more U.S. capacity, plastics recycling executives said it's far from a slam dunk.
Bagaria peppered Erema officials with questions about the economic picture, noting the large investments underway in virgin plastics capacity in the United States fed by low-cost shale gas feedstock.
"The virgin petrochemical industry is setting up plant after plant after plant because of the shale gas," he said.
Still, he and Xuan said the saving grace for investment in recycling now is that China's restrictions have pushed prices of recycled scrap very low in the United States.
Others at the Erema event agreed the recycling sector was being challenged by low virgin material prices.
"We have a fundamental problem, there's no question about that," said Martin Baumann, vice president of sales for North America for Erema. "The recycling industry is very much challenged because virgin resin is too damn cheap."
The Chinese government ban is hitting the industry worldwide.
Xuan said the restrictions have been a "continuous catastrophic disaster" for many Chinese recyclers.
Recyclers in Europe are echoing those in the United States, saying that China's slowdown on imports has thrown the markets into turmoil and left Europe awash in materials it cannot recycle.
"The market is oversupplied with low qualities of plastics waste due to China's restrictions on imports," said Ton Emans, president of the Brussels-based Plastics Recyclers Europe association, in a Sept. 25 statement.
"These low qualities used to be exported as a cheap end-of-life solution for badly collected and sorted waste," he said.
PRE said Europe needs to focus on improving its own design for recycling, collection and sorting to build a "sustainable waste market in Europe" rather than relying on exports to China to handle lower- quality plastics.
"Lack of vision of the value chain over the last few years has now resulted in the EU being unable to treat these new quantities overnight," PRE said. "Nevertheless, industry, policy makers and society must now urgently bring a common solution to the table."
~~~~~~~~ By Steve Toloken
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