Displayed with permission of Plastic News, Copyright Crain Communications, Inc.
Originally published in Plastics News October 15, 2007.

By Lauren Hilgers
PLASTICS NEWS CORRESPONDENT

   In the past year China has passed a list of regulations aimed at reigning in some of the less-savory practices in its recycling industry. Real change, however, is likely to be pushed from abroad, experts say.
   “The shifting paradigm right now is that there has been an increased interest in using recycled plastic for a variety of applications,” said Darren Arola, global director of product development at sales at MBA Polymers Inc., a Richmond, Calif.-based recycler.
    “There are different guidelines for the different applications, depending upon the market, in addition to the manufacturers’ own standards,” Arola said. As demand for specialized applications grows, plants able to sort and authenticate the quality of their product will have an advantage. In the past, China has been dominated by backyard recycling operations — scrap is sifted by hand and quality is tested by burning, to determine the material, or biting, to determine strength.
    The low-tech process also can release potentially poisonous fumes into the atmosphere and allow waste products to be dumped, or to run off into rivers and streams. To combat the harmful effects of what Arola calls “rogue recyclers,” the Chinese government passed environmental regulations in January 2006. It also has adopted the equivalent of Europe’s Waste Electrical and Electronics Equipment (WEEE) and the Restriction of Hazardous Substance (RoHS) directive.
    “The standards that they have implemented, more or less [are] the first step,” Arola said. “But there is such a large existing infrastructure that they are not going to be able to adopt those standards overnight.”
    MBA’s Guangzhou plant is one of the few that already meets international standards. Unlike many China-based sites, MBA’s plant is mostly automated and the company runs a tight sourcing system for its scrap plastic.
   “Some of the people that we’re servicing are selling their products overseas — they want to have the possibility of selling in any market,” Arola said. “We want to make sure that our product meets those standards.”
    More immediate change could come from increasing demands from downstream companies and regulations from overseas, said Surendra Borad, managing director of shipping company Gemini Corp. NV of Antwerp, Belgium. The European Union recently released a stringent set of shipping regulations.
    Gemini exports scrap to India and China. India, Borad said, has stricter laws than China and requires each shipment to be welldocumented. “But then, China imports almost 100 times as much scrap as India does,” Borad said.
    The trade imbalance between Europe and China has made it cheaper to ship to China than nearly any other place, Borad said. Containers emptied in the West need something to fill them on their return trip.
    New EU regulations, however, could require all scrap heading out of the area to be labeled with its destination. While it remains unclear when the rules might be implemented, they could hamper trade with China, Borad said.
   “To China, you can’t make documentation for every single shipment,” he said. “It would be chaos.”
    Arola hopes the new rules and demands from both inside and outside China will begin to improve the infrastructure and recycling practices, even if it means more competition for MBA.
    “If China WEEE continues to develop and there is more source material, we would definitely consider building another facility in northern China,” Arola said. “That decision would be greatly influenced by the further development of large-scale take-back and recycling in China itself.”

Reprinted with permission of Plastics News. Copyright Crain Communications Inc. 2007

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