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Big Changes in the Recycling Industry

For decades, much of the recyclable scraps and waste produced in the U.S. (paper, plastic, etc.) hasn’t actually been recycled in the U.S., it has been sold to China for processing. China is currently the major market for waste paper and plastics. In fact, scrap paper and plastics are the 6th largest export from the U.S. to China. It’s a $5 billion-dollar business.

Why not keep this scrap here in the U.S. for recycling? This exchange boils down purely to economics.

The U.S. runs a massive trade deficit with China, so the container ships that regularly arrive in the U.S. from China are full, while the returning containers are not. Seizing on this opportunity, the scrap recycling industry in the U.S. has been able to cheaply load up these containers with recyclables (especially lower grade plastic Nos. 3-7) which they then sell to Chinese recycling facilities.

Bottom line: it’s been significantly cheaper to ship scrap from the U.S. to China than to send it by rail across the U.S. Coupled with the fact that breaking down and re-using plastics has not yet become an economically feasible option for most U.S. manufacturers, and you’ve got a real environmental problem.

And unfortunately, things have gotten even more complicated.

China is beginning to take serious regulatory actions about “contamination” and what kind of scrap material they are willing to accept. This is creating huge market uncertainties and a crippling increase in the level of risk recycling processors face when shipping bales of materials to China.


WHAT IS CONTAMINATION?

Contamination, in this context, refers to what happens when non-recyclable items are mixed in with recyclables items, or when recyclable items are placed in the wrong recycling bins.


In a nutshell, typical bales of processed recycled materials contain 5%-10% trash. This amount of trash slipped through the sorting equipment and pick lines used to remove trash and sort mixed recyclables in each load of single-stream material. Up until now, that 5%-10% residual trash has been accepted by Chinese processors.

But, residual trash has created an environmental nightmare in China, and in response, the Chinese government decreed that residual levels must now drop to less than 2%. The risk to American processors now is that if sample bales being inspected upon delivery to a Chinese port reveal too much residual waste, the entire shipment can be rejected, and the American processor must take back the loads.

 

What This Means for Mill Valley Refuse Customers

In years past, MVRS has received payment for the tons of recycling we have picked up in our jurisdictions, and the income we received offset costs and helped to keep rates lower than they otherwise would have been.

With the changes in the market, and new restrictions in place, we are forced to re-examine how we collect recyclables. Currently, we are using a “single-stream” model, meaning you place all your recyclables in a single can which we pick up and deliver to Redwood Sanitary Landfill where it is loaded onto semi-trucks and transferred to a processing facility in Benicia. There the material is sorted and baled for shipment to China. Unfortunately, this single-stream model results in a relatively high degree of contaminant and we are concerned that this will cause problems in our ability to secure processing at a reasonable rate for our customers.

We are exploring every option to determine what course of action we can take to meet both the recycling needs of our community, and the increased requirements of our processors. We are meeting with city governments to discuss and will have an update for our customers as soon as we have a solution.

 

More Information

China to U.S.: Please stop sending us your junk - cnn.com

Pushing Back on China's Recycling Mandates - waste360.com

China Bans Foreign Waste--but What Will Happen to the World's Recycling? - Scientific American