Yesterday 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.
ISRI has already notified the Office of the United States Trade Representative and the U.S. Department of Commerce on the devastating impact such a ban will have on the global recycling industry, especially because ISRI has heard that China is considering additional notifications in the future on other scrap materials. Upon receiving this information, ISRI immediately briefed U.S. officials in preparation for tomorrow's U.S.-China Comprehensive Economic Dialogue (CED) in Washington.
With more than $5.6 billion in scrap commodities exported from the United States to China last year alone, the trade in specification-grade commodities – metals, paper and plastics – between the United States and China is of critical importance to the health and success of the U.S. based recycling industry. If implemented, a ban on scrap imports will result in the loss of tens of thousands of jobs and closure of many recycling businesses throughout the United States.
The scrap recycling industry is the first link in the global manufacturing supply chain. Recycled materials are key inputs into the production of new, usable commodities for the use in value-add production. In any given year, approximately one-third of the scrap recycled in the United States is prepared for shipment to the export market, and China is the recycling industry's largest customer. This includes more than $1.9 billion in scrap paper (13.2 million tons) and $495 million in scrap plastics (or 1.42 million tons).
More than 155,000 direct jobs are supported by the U.S. industry's export activities, earning an average wage of almost $76,000 and contributing more than $3 billion to federal, state, and local taxes. A ban on imports of scrap commodities into China would be catastrophic to the recycling industry.
ISRI will continue to follow this development and provide information as soon as it is available.