China Restricts U.S. Scrap Imports

The U.S. scrap industry is a significant exporter of high-quality scrap commodities to China. Since 2017, China has begun restricting scrap imports, for the protection of the environment and people’s health, including metals. This has had a huge impact on U.S. scrap imports to China. Before the ban, which first went into effect in March 2018, China was the biggest buyer of US recyclable materials.

In the U.S. alone, some 26.7 million tons of recycled plastic were sent out of the country between 1988 and 2016. Overall, 31% percent of U.S. scrap commodity exports – worth $5.6 billion – were sent to China in 2017, according to the Institute of Scrap Recycling Industries.

The loss of the Chinese scrap export markets has disrupted recyclable markets leading to lower revenues as some materials must be sold at significantly lower prices, sometimes even negative. According to a report by the National Waste and Recycling Association in Washington DC, the prices of recyclable materials have plummeted. For example, in December 2017, mixed paper sold for $32 per ton, and a year later it was valued at $4.69 per ton.

An estimated 111 million metric tons of plastic waste will be displaced with the new Chinese policy by 2030, according to the study published in Scientific Advances. This is equal to nearly half of all plastic waste that has been imported globally since 1988.

Meanwhile, shipments of plastic waste to other Southeast Asian countries have skyrocketed. Pastic scrap exports from the U.S. to Thailand jumped almost 7,000 percent in one year. Malaysia’s went up several hundred percent. Those numbers dropped in 2018 after those countries cut back on imports.