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China's Scrap Trade Policy

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The Issue

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The Chinese government is undertaking an effort to reform its solid waste import management system, which includes:

  • Protecting the environment from imports that are perceived to be the most polluting;
  • Halting imports that can be replaced with domestic resources;
  • Eliminating imports of trash;
  • Cracking down on illegal trade of trash and poor recycling business practices within China; and
  • Accelerating China’s domestic recycling industry.

ISRI supports the Chinese government’s efforts to protect the environment. ISRI has offered to be a conduit of information for its members to comply with Chinese regulations and to provide information and training to the Chinese industry of best practices in environmental, health, safety and overall business management to help enhance recycling within China.

Why it Matters to Recycling

A strong and robust recycling industry is critical to a healthy manufacturing sector. The U.S. scrap industry is a significant exporter of high-quality scrap commodities to industrial consumers worldwide. With the steady growth in China’s industrial economy, there has been an ever increasing demand for scrap supplied from the United States and around the world. As a result of China’s industrial production, plastic and paper scrap consumption increased 50% and 70%, respectively, over the last decade. Overall, 31% percent of U.S. scrap commodity exports – worth $5.6 billion – were sent to China in 2017.

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As part of China’s environmental protection drive, the government implemented on January 1, 2018, a ban on scrap plastics from household collections and unsorted, mixed paper from all sources, affecting more than $500 million of exports to China. Then, on April 19, 2018, China announced the intent to ban all plastics, small electric motors and insulated wire by the end of 2018 and stainless steel and other metallic scrap by the end of 2019. This will affect an additional $446 million of U.S. scrap exports.

In addition, on March 1, 2018, the Chinese government implemented stricter technical standards for scrap imports, allowing only shipments that meet very strict thresholds for allowable contaminants to be imported. Unfortunately, existing technology makes meeting those targets a challenge for most scrap commodities.

Through these policies and additional measures since, the Chinese government is curtailing the free and fair trade of scrap commodities into China.

ISRI's Related Advocacy Positions

  • Enforcement of Existing Trade Laws. ISRI supports the strongest practicable measures to protect its domestic consumers from illegal dumping and unfair subsidies that have direct and indirect negative economic impacts throughout the manufacturing supply chain.
  • Promotion of Trade Agreements that Open Markets and Harmonize Standards/Regulations. U.S. recyclers win when they have access to existing and emerging international markets and where there is regulatory transparency and harmonization. It is for this reason that ISRI supports the U.S. government’s efforts to negotiate free trade agreements that contain market-opening and barrier-reducing opportunities around the world.
  • Elimination of Tariff Barriers on U.S. Recycling Industry Exports. Exports of U.S. scrap commodities and recycling equipment currently face a range of import tariffs around the world. At the same time, there are no (zero) general duties imposed by the United States on imports of recycled goods such as recovered paper and fiber, ferrous and nonferrous scrap, or plastic scrap. For these reasons, ISRI aggressively supports efforts such as the Environmental Goods Agreement (EGA) at the WTO that have the potential to eliminate tariff barriers on U.S. recycling industry exports, thus promoting U.S. economic growth, creating jobs, raising income, and generating additional federal and state tax revenue.
  • Promotion of Global Specifications. Supporting opportunities to provide consistency in scrap specifications worldwide through ISRI’s Scrap Specifications Circular remains one of ISRI’s top priorities as we seek to ensure minimal disruptions and increase consistencies in the trade of scrap commodities across borders.
  • ISRI News

    • Following on its notification to the World Trade Organization (WTO), the Government of China officially announced on July 21, 2017, it has "banned the importation of 24 categories of solid waste such as waste plastics, unsorted waste paper, waste raw textile materials, and vanadium slag that pose very high risk of environmental pollution."
    • On Tuesday, July 18, 2017, China notified the World Trade Organization (WTO) of its intent to ban the import of certain scrap materials by year end. Among the items included on the list are most scrap plastics ("including polymers of ethylene, styrene, vinyl chloride and PET..."), mixed paper and slags and drosses.

    China in the News

     

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    Have Questions?

    Adina Renee Adler
    Senior Director, Government Relations & International Affairs
    AdinaAdler@isri.org
    (202) 662-8514