BIR: Pandemic continues to challenge recyclers

Covid-19 is likely to remain a significant factor in the global scrap recycling trade until well into next year, according to reports from members of the Bureau of International Recycling.

In India, states are implementing restrictions, including night curfews, to tackle still-high levels of infections. Companies are free to operate their plants but the virus continues to pose a huge threat to industrial activity, not least by affecting business recovery and investment plans, the mobility of migrant workers and the availability of credit, BIR has been told. Central and state government support is stretched to the limit.

Companies in danger zone

KPMG India estimates the country’s GDP rate will fall below 3% if the virus continues to have a significant impact and many now believe this will become a reality. There are concerns that a return to tighter restrictions could spell closure for many micro, small and medium-sized enterprises with loan obligations to meet and monthly instalments to pay.

Business activity levels are normal. From China, however, there has been no official announcement as yet regarding any CCIC pre-shipment inspection requirements under the country’s new import procedure for copper, brass and cast aluminium grades that are classified as ‘recycled materials’. Although some Chinese customers have suggested there is no CCIC requirement, some shipping lines have established freight rates for recycled materials.

Elsewhere in Asia, Covid-19 infections appear to be under control in Singapore but are increasing in other countries, including Indonesia, Malaysia, the Philippines and Bangladesh. Travel restrictions are having a major economic impact by limiting the available workforce and the much-discussed ‘bubble’ between Singapore and Hong Kong has had to be postponed owing to the latter’s rising infection numbers.

Slots ‘nightmare’

Such conditions apply at a time when obtaining confirmed slots for shipping scrap in containers is reported to be ‘a nightmare’. Costing forward business is proving very difficult as rates have tripled for ASEAN region shipments to US ports and have more than doubled to European ports. Transit times have been extended significantly owing to long trans-shipment layovers.

Scrap yards and ports are running normally in many parts of the Middle East. In Lebanon, however, a lockdown has been implemented in response to a second wave of infections. This was due to end on 30 November but could be extended until 15 December pending an assessment of latest numbers.

Essential industries in Lebanon are being allowed to work at 30% capacity and ports remain open for imports and exports, but again at reduced capacities. Most scrap processing facilities are closed because of restrictions on movements.

It is also reported that major roadworks in Sharjah have affected the volumes of scrap arriving at local yards from around the UAE.

Tourism almost dead

The pandemic is weighing heavily on a number of countries in the MENA region, many of whose tourism industries have been brought to a near standstill by the crisis. This slump in visitor numbers has contributed to significant economic contractions and poses challenges for the labour market.

In the aftermath of mandated lockdown measures, Dubai’s tourism sector is gradually charting a path to normalisation, although progress in this direction will remain dependent on the development and rollout of vaccines as well as the resumption of global travel. Those visiting the UAE are asked to undergo a test at the airport and then self-quarantine; if the test proves negative (results are generally received within 24 hours), the visitor is free to travel around the UAE.

Back to lockdowns 

The USA is witnessing rampant infections, although politicians and the general public remain firmly divided on the realities of the virus. Each state, as well as each county within a state, can implement and enforce their own measures aimed at controlling the spread of the virus, resulting in a wide range of restrictions, shutdowns and lockdowns throughout the country, the most onerous of which are in areas with uncontrolled outbreaks. Los Angeles, for example, is considering another total lockdown of non-essential businesses.

In Europe, Germany is in a partial lockdown in which restaurants as well as cultural and facilities are largely prohibited from opening their doors. The federal parliament has extended special rules on short-time working until the end of 2021. Despite the more restricted environment, German industry – and particularly the automotive sector – is running well.

Open for business 

From early December, large parts of the UK will be in a tiered system with the severity of restrictions determined by local infection rates, although a slight relaxation of these measures is promised for five days around Christmas. Recyclers have remained in operation and are describing business as reasonable and sufficiently strong to justify opening their gates.

UK borrowing of at least £370 billion during the crisis has been greater than at any time since the Second World War. Prime Minister Boris Johnson believes the economy is probably going to be 10% smaller than it was a year ago – the worst annual contraction for three centuries. The government is to introduce a three-year capital spending plan in an attempt to stimulate the economy and create jobs through infrastructure projects such as new bridges and roads.

Restaurants stay closed  

The recycling industry has also continued to operate in France. The country has announced a three-stage softening of virus-related measures, starting with the reopening of all shops in compliance with very strict health rules. Travel restrictions are also to be relaxed but will remain onerous.

If infection numbers show a sharp decline, the second stage of this relaxation process is scheduled to begin on 15 December. Inter-regional travel will be authorised for the Christmas period. Depending on progress, a reopening of restaurants, cafés, hotels and sports halls is envisaged for 20 January.