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China to ban various scrap commodities

China has 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.

The notification to WTO was made July 18 and is significant, China is the world’s largest destination for the global recycling industry. A ban would have a “devasting impact” according to Robin Wiener, President of the Insitute of Scrap Recycling Industries (ISRI), a US-headed trade association that represents approximately 1 300 companies operating in nearly 4 000 locations in the United States and 34 countries worldwide.

With more than US$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. 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 US$1.9 billion in scrap paper (13.2 million tons) and US$495 million in scrap plastics (or 1.42 million tons). A ban on imports of scrap commodities into China would be catastrophic to the recycling industry, said Wiener.

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