China has thrown down the gauntlet on an environmental\u00a0trade war\u00a0of sorts. Plastic is the latest shot fired across the West\u2019s bough in an economic trade war. Scrap metal is expected to be next. Some industry experts say the Chinese aren\u2019t looking for a fight with the United States, in spite of their rhetoric. The actual target is\u00a0EU\u00a0trash bundled around cardboard and exported to\u00a0China as recycled commodities.<\/p>\n
China\u2019s\u00a0Green Waste Initiative\u00a0has been in effect since 2013. It blocks what China calls \u201cdirtier plastics,\u201d known in the #recycling\u00a0industry as types No. 3 \u2013 7\u00a0from import.<\/p>\n
These include bags, some bottles, mixed fibers and some types of packaging. In addition, several commercial products fall into these categories. Now the largest recycling importer in the world in upping the ante with\u00a0Operation National Sword 2017\u00a0which forbids the import of four classes, 24 kinds of solid wastes.<\/p>\n
U.S.-based\u00a0solid waste\u00a0company officials told investment analysts they were concerned about the proposed ban but expected to survive. They have seen it before and their\u00a0recyclables\u00a0are sorted and clean.<\/p>\n
The 800-Pound Gorilla<\/strong><\/p>\n However, paper and plastic\u00a0recycling is big business and the Silk Road runs through China. More than $5.6 billion in\u00a0scrap commodities\u00a0were exported from the United States to China in 2016, according to ISRI, a recycling trade association. U.S. firms exported 13.2 million tons of\u00a0scrap paper\u00a0and 1.4 million tons of\u00a0scrap plastic\u00a0to China last year.<\/p>\n When\u00a0Europe\u00a0and\u00a0Japan\u00a0are added to the mix, the giant importer collected more than 7.3 million tons of plastic scrap. China imported 27 million tons of paper more than a quarter of which was mixed paper.<\/p>\n China controls the market price, according to U.S. executives. \u201cThey have driven the market from, I’m going to round, 90 to 100, up to now 190,\u201d\u00a0Waste Connections CEO Ronald J. Mittelstaedt\u00a0said. \u201cThe history is it will move back down at some point probably in the latter part of the fourth quarter, not necessarily to 100, but it could move down to 150.<\/p>\n \u201cAnd it goes through these cycles,\u201d he added. \u201cWe have always said to all investors, that’s why we would\u00a0prefer that a low percentage of our business be based on commodities, because it is a commodity, and it is going to ebb and flow.\u201d<\/p>\n