Global – ‘Fear of possible restrictions on Chinese imports of certain forms of plastics scrap has drastically altered the demand for, and commercial values of, plastics scrap in Europe,’ laments Surendra Patawari Borad of Belgium-based Gemini Corporation NV, chairman of the BIR plastics & rubber committee.
China absorbed 1.62 million tons of the EU’s plastics scrap exports in 2016 – more than 50% of the union’s total shipments to all destinations.
Therefore, a ban on these flows ‘would create huge availability in Europe’ such that its recyclers ‘would not be in a position to consume the volume which would become available in the absence of exports to China’.
The resulting low prices would make collection and sorting ‘unviable’. Exporters are looking for markets other than China in order to restore some stability to their businesses, but the outlook remains unpromising.
‘Exports to other Asian countries such as India, Vietnam, Malaysia and Indonesia might grow in the coming period but exporters will be unable to achieve a correct value for their material,’ Borad explains. ‘Combined, these countries imported around 14% of the EU’s total exports in 2016, illustrating that no solid alternative to China is available.’
According to the China Scrap Plastics Association’s executive president Dr Steve Wong of Fukutomi Co. Ltd, licensed importer factories have been asked to surrender part or all of their import permits on hand.
‘Realistically,’ he says, ‘this has undermined the likelihood of further import permits being approved for the remaining months of this year.’
Market sentiment is ‘gloomy’ as China’s new policy has served to ‘stall movements from exporting countries that are pondering whether they should wait for the Chinese market next year or, instead, send their materials to South East Asia where market risks are relatively high’.
This article is based on the latest ‘World Mirror on Plastics’ produced by the BIR world recycling organisation for the benefit of its members.