Guomen Lijian may create new trade routes outside China for the plastics industry
SHANGHAI -- At the biannual China Plastics Recycling and Recycling Conference/Exhibition Fair, plastic recyclers have delved into the global changes caused by the Beijing Guomen Lijian movement.
The new restrictions on the import of industrial waste were announced on April 19, and were seen by some as another coffin nail in the once-popular Chinese waste plastics import business.
However, when the teeth are annoyed, an industry adaptation picture is also emerging.
Khadem Mahmud Yusuf, a PET waste handler from Bangladesh, said: "China's awareness of environmental protection has been awakened."
At the same time, countries that export waste to China must increasingly rely on themselves to deal with waste. He said: "I think this is a wonderful thing."
After the Beijing ban, the plastics industry is still reorganizing, and participants at the conference said they realized that the global recycling trade may be moving in a good direction.
Some recyclers outside China see an opportunity from the new business model: transporting recycled pellets to factories in China.
Steve Wong, executive director of the China Plastics Recycling and Recycling Conference and executive director of the China Waste Plastics Association, based in Beijing, said: "The number of approvals is a small part of the past, so it makes no sense to operate a plastics recycling plant here." President Huang did not attend the China Plastics Recycling and Recycling Conference, but accepted the visit of Plastics News.
The data shows the drastic changes brought by the national sword. Wang Binli, head of China's polyolefins at IHS Markit, pointed out in the speech of the conference that the EU's exports of waste plastics to mainland China fell by nearly 40%, and exports to Hong Kong fell by 50%.
US exports to China and Hong Kong have decreased by nearly 29% and 43% respectively.
China used to import waste from the United States, Europe and Japan, and now it has imported recycled pellets from these regions and Southeast Asia.
A number of Chinese waste plastics recyclers attending the Shanghai meeting on April 21-22 have long smelled the wind and have already opened operations in Southeast Asia, where restrictions are not so strict.
These recyclers who have long taken action say they have taken the lead. Huang Huijing of Dalongkai Technology Co., Ltd. moved from China to Malaysia many years ago.
He said: "In the past six months, many Chinese have moved their factories to Malaysia. The business is good."
According to IHS Markit, exports of waste polyethylene (PET) to Malaysia more than doubled from last year. Then Malaysia exports PET pellets to the world (mainly exported to China). The same trend can be seen in Thailand and Vietnam.
Zhang Tao, a Malaysian supplier of tanjung Majujaya, which produces pipes for PE, blown film, waterproofing membranes and foamed PE, agrees. He said: "Our business is very good." He collects waste in Malaysia.
He said: "Because China can't import waste, they buy granules from us, and our business is getting better."
Yusef, CEO of the Bangladesh Recycling Enterprise Petrochemical Company, spoke during the international speech of the conference, saying that he had received unexpected benefits from his ban that helped his business.
Most of his sales targets are domestic companies, because Chinese companies know very little about purchasing recycled pellets in Bangladesh. But the ban imposed by the Chinese government in mid-2017 changed the outlook.
He said: "I have received many orders from China. We must quickly increase production capacity so that we can balance the domestic and Chinese markets. In February of this year, I had my first Chinese customer. Now I have four The gains of this conference far exceeded expectations."
He said: "We arrived at 9 am yesterday and laid our booth. Suddenly, people around were asking for business cards and samples. I was too confused. I didn't expect this."
Some conference participants pointed out that it is very difficult to purchase recycled pellets in China, and Chinese manufacturing plants prefer imported materials.
Chandramouli Venkatesan, Sustainability Manager of Cybex, a car baby seat manufacturer, also came to the show to find waste plastics processors in China.
He said: "I am looking for domestic waste polypropylene (PP), but nothing."
Wang Binli of HIS Markit also pointed out that domestic processing and production lacked due attention.
He said: "Products companies say they are more willing to use imported recycled pellets than domestic ones. Even if they cost more. The quality of each batch of materials is unstable. This is a problem."
He said that solving this problem requires a lot of resources. He said: "First of all, the Chinese government needs to educate the public about the classification of garbage. They also need to invest in the domestic waste recycling industry. Only in this way can the industry develop healthily."
He estimates that the domestic recycling industry may take five years to develop.
Some industry insiders also want to know whether the current migration of waste plastics in Southeast Asia will be permanent, and also focus on doing business in other markets, including the United States.
Maria Qian, chairman of One Stop Recycling Services LLC in Austell, Georgia, the 20-year-old veteran has seen plenty of opportunities in China's ban.
She said: "Most of our customers have moved to Southeast Asia, but I have found a trend that more Chinese companies are interested in investing in the United States."
But she cautioned that opening a scrap processing business in the US would be a difficult road for Chinese companies, especially smaller ones.
She said: "Small and medium-sized enterprises are too few, and there are too many cultural challenges, such as visas and language barriers. But big companies are very cowering and more conservative."
She mentioned a Dongguan company, and as far as she knows, the company is seriously considering relocating the reprocessing business to the United States. "They don't think Southeast Asia can be strong for a long time. The United States is a big source of waste plastics."
However, several participants pointed out that if the United States wants to start recycling its own waste plastics, it faces challenges including a lack of self-sorting culture. They say that because of the need for manual sorting in the United States, companies can't afford labor costs, which can pose challenges for recycling companies.
Yusuf said that the automation systems used by US recyclers are still not as good as manual sorting. He suggested working hard to develop better automation solutions.
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