More than a year ago, China formally announced its intention to ban the import of all recyclable materials by 2020 under a revision of the country's solid waste management law. New information indicates there might be more flexibility in the timeline than originally assumed.
The Institute of Scrap Recycling Industries (ISRI) recently alerted members that China released a new version of its solid waste management plan, which appears to contain softer language regarding the scrap ban. Whereas last year's version explicitly stated imports would be banned in 2020, this version says "the state shall gradually and basically realize zero imports of solid wastes."
While China's previous unwavering stance in this area had led recyclers and material exporters to view the deadline as set in stone, ISRI Assistant Vice President of International Affairs Adina Renee Adler now sees some flexibility. She called the new language a "signal to us that they're not still looking at 2020 as a firm deadline, but rather, they would do this in a more deliberative way."
Adler cautioned that this is merely a deduction based on the document's current verbiage, and discrepancies could exist in the translation. That said, the new language led ISRI to "make an inference that China still wants the ban, but it might take longer."
ISRI has stated its disagreement with import restrictions and requested that China alter its regulatory language to distinguish between "waste" and "scrap." The National Waste and Recycling Association requested a five-year phase-in period for the 2020 ban and sent a letter to President Trump in February urging him to push back on China's policies during trade talks.
Earlier this year, China added additional import restrictions on top of those already enforced through the National Sword and Blue Sky efforts. For example, regulations on certain scrap metals that were previously on the "unrestricted" list took effect July 1. Last month, Chinese leaders also issued the latest round of import quotas for copper, aluminum, ferrous metals and recovered paper.
Although China's import restrictions apply globally, Adler said U.S. recyclers face additional market destabilization and uncertainty brought on by the trade war and ensuing tariffs.
Trump's recent announcement of more tariffs on China sent copper prices plummeting 7%, reaching their lowest point in months. Scrap copper demand from China had already been on the decline since the second half of 2018. Aluminum recyclers have also felt the squeeze from tariff-induced market disruptions, combined with import restrictions.
Walking back its total scrap ban could indicate that Chinese ministers realize the country currently lacks a self-sustaining model for incorporating recycled materials into new products, and that foreign sources are still needed. Prematurely cutting off all imported feedstock at once could cause a widespread collapse of the Chinese manufacturing sector.
Amid of all these changes, China is still accepting certain materials that meet its 0.5% contamination standard. The government is also still allowing the import of raw materials derived from recycled materials to be used for manufacturing. This includes plastic pellets and some "furnace-ready" metals that don't need to be hand-sorted and processed. The government is in the process of developing a set of standards for these materials as well.
Even if China does ease the timeline for implementing the 2020 ban, it's unclear which materials might be affected. Adler explained the country is unlikely to release a formal statement on changing the overall policy due to cultural customs; instead, environmental ministers would likely make formal announcements about measures for certain materials.
While the news of a possible graduated ban provides a ray of light for some recyclers, it also perpetuates ongoing industry uncertainty. Recyclers must decide whether to proceed as if the total ban will occur or hold off on making changes until more clear-cut regulations are revealed.
"I can't advise how [recyclers] will continue their business. We just give them information as it comes in and let them make their own business decisions," Adler said. "There is still market uncertainty."