Ever think about where your recyclables
go after the blue bin? Well, for a long time, about
a fifth of American mixed recyclables were heading across the
sea to China. That makes sense since China has
the largest manufacturing output in the world and they need the
scrap material to create all your favorite paper and plastic items. However, following a public awareness
campaign, an outcry from Chinese citizens ignited in some
cases by the documentary Plastic China. The country implemented a
series of policies called Green Fence National Sword and Blue Sky
to stop your curbside pickup from ending up in unmanageable
quantities in China. The world's largest paper
consumer radically changed their specification, and they've basically set
a standard that's, if not impossible, sort of effectively
impossible to achieve. Rest assured, goods are
still being recycled. They became a buyer's market. But communities and industry organizations
now have to pay processing plants to take the goods instead
of selling the scrap material for profit profit. In 2017 mixed
paper, which is everything but cardboard, was trading at roughly
$90 dollars a ton. Currently, it's trading
at roughly nothing. These changes have created a bright
spot in the industry for new development in areas where China has
left a plastic water bottle shaped hole. In fact, some
Chinese corporations are investing in recycling facilities in Maine
and West Virginia. National Sword has been a major benefit
to our business model and we think long term will be
a tremendous benefit to recycling infrastructure and circular economy
development in North America. Changes in Chinese policies has
really focused attention and energy, and I'm also glad to say
innovation on the topic of recycling. In total, resource recycling found
the impact of China's new recycling policies created over 4.4 billion dollars of investment
in the U.S., which is supporting over
3000 American jobs. Since China stopped purchasing American
scrap materials, why are Chinese companies investing in
recycling in the U.S.? To understand why China stop processing
a large portion of global recyclables, we need to review
why they started collecting it. Many American communities had adopted
single stream recycling for its ease of use and collection. That is when residents place plastics,
metal and glass into one typically blue bin. When your materials
are collected at the curb, they are then taken to a
facility and they're sorted out automatically. We were essentially offshoring
our labor of sorting these materials to China. While this method encourages more
participation in recycling, it also increases the amount of contamination
in what is recycled. Contamination occurs when non-recyclable
items are collected alongside recycled items. When they've been placed in the wrong
bin or when soiled products say a dirty food container is
placed in the recycling bin. Effectively, what the Chinese were saying
was that the US recycling industry was sending in recyclables that
were also stuffed with a lot of garbage and a lot of that
developed because the Chinese for so long had such an insatiable
appetite for our recyclable commodities. They would take a
higher level of contamination. Now keep in mind that as a dealer
by dealer, not a a MRF to country, do you know this isn't a policy,
t his is just how the market behaved. The materials that we were
sending over to China, their allowable contamination levels were around the
3 to 5 percent range historically, that was
the industry standard. A twenty eighteen study showed that
China had imported a cumulative 45 percent of plastic
waste since 1992. And in 2016, 72 percent of all U.S. plastics scrap exports
went to China. At one time during the peak, we
exported about 30 percent of our material, the recycled paper
material into China. That's down to less than 3 percent. About half of the paper that we
received from the city was going to China. All that was made much easier
by the trade deficit with China, which has topped over $300
billion every year since 2012. We import a great deal of manufactured
goods from China and they come on ships with big containers. Those containers were going back empty
before the rise of recycling. In fact, Public Radio International estimated
that the US was sending nearly 4000 shipping containers of
recyclable goods to China every day. For us, there is always more
value in that material to be able to recycle it as opposed to
putting it in a landfill. Organizations like Waste Management worked
with brokers to send their recyclables overseas where they would get
a better price for the goods. It was a an aphorism in the recycling industry is that China
had the most stringent environmental laws in place. They
just didn't enforce them. Well, that changed beginning in
2013 with a Customs Enforcement action called Operation
Green Fence. Laws regarding specific environmental regulations
were passed in 2006 and 2010, and the country began
an official crackdown in February 2013. Companies were importing dirty
bales from the United States, using the recyclables and then just
discarding the garbage in a river, the ocean, a street corner. In 2017, China announced a set
of even stricter restrictions on specific recovered materials
called National Sword. Including recovered mixed paper, many
types of plastics and textiles. One of the things that drove
National Sword was the increasing expectation of Chinese citizens to have
a better standard of living. China set the maximum contamination
level for loads of recyclables, not fully banned to
point five percent. They've basically set a standard that's,
if not impossible, sort of effectively impossible to achieve a sort
of a half a percent contamination rate. And so from going from 4 5
percent non acceptable material to a half a percent overnight caused the
turmoil in the recycling markets. The Chinese decided that they wanted
to stay highly focused on recycled commodities, but didn't want
any of America's garbage. And so they put that policy in
place, which I think caused some short term pain in the
American recycling industry. Recovered plastic shipments to China,
dropped about ninety nine percent from twenty seventeen
to twenty eighteen. However, recyclable scrap materials are
still being collected, so the industry is starting to adapt. You got a lot more environmental,
economic and job benefits out of recycling than you do out of just
throwing something in a hole in the ground. It's because of, you know,
this recognition that was in large part prompted by China's Sword, that
the enthusiasm for really taking a good hard look at the
America recycling system has started. We've had to
find alternative markets. So while Waste Management's a
North American company, we actually have offices in China, in
Southeast Asia and South America. And so we had relationships with paper
mills that we have called on to say, hey, can you take some of
the material now that China is not accepting it anymore. For a short while, other countries
in Southeast Asia, like Vietnam, India and Indonesia, accepted some of
the recycling bales that China refused. However, many of those ports
are ill equipped to handle such a mass import of scrap materials
and have begun following China's example in setting stricter
standards and bans. Materials are finding homes, it's just
that the value has plummeted. So you even saw Malaysia send
materials back mixed plastics back to the countries of origin U.K., France and the U.S. as well as Canada, but also the
the long lasting impacts of National Sword and Blue, you know, Blue Sky
and Green Fence a nd China's scrap ban is that those countries feel that
they can push back on what the materials are that are coming
back into their system. Long term, it's going to be a
major benefit because it's go nna force the industry to be much, much
more efficient, produce a much higher quality product that we'll actually be
able to be used in domestic manufacturing supply chains. Well, the real focus of EPA's
work is focusing on the U.S. system and building a system that
is more resilient to both changes in international markets, but also
and critically, changes in this stream of materials that
are available for recycling. New American sorting facilities are opening
up to process the scrap material. And American companies are
investing in updating their materials recovery facilities or MRFs
to meet the new standards. In fact, in total, we
see more than $4.4 billion dollars of investment, of
opening new new facilities, reopening facilities or retooling existing
facilities to be able to take in that material from the
mixed paper or cardboard streams. And that is supporting over 3000
jobs here in the U.S. We can still get to that that
very strict quality that our our customers demand of us
at this point. And so we've done a lot
of investments in new recycling facilities, in robotics, in new optical sorting
technology and so we've really gone after the technology side to help
solve the problem as well as education. We started sorting to
domestic specifications about 6 7 years ago before the most
recent Chinese restrictions came on. Nine dragons seems to be very
aggressive in investing in American recycling infrastructure. They're developing a number of
paper recycling and pulping projects in the United States in order to
bring that recycled pulp back into China. Paper giant N.D., owned by Nine Dragons Paper,
recently opened mills in Maine, Wisconsin and West Virginia. While their operations combined virgin
and recycled goods, according to N.D. their Fairmont, West Virginia
mill has the capacity for 240000 tons of recycled pulp. Industry is stepping up and
investing here, both overseas industry like China, but also existing paper
and plastics recyclers here in the United States. Phoenix Paper
Company, a subsidiary of Chinese company Shanying International, recently opened
a paper mill in Kentucky. They announced that in 2021,
the company plans to expand the Kentucky mill to
include a recycling facility. They've invested 200 million dollars in
the project that will create an additional 150 jobs in the area. One of the reasons behind China's
support in the recycling system is they have fewer forests as a natural
resource to be able to to make paper and pulp out of s
o they're coming to the U.S. Since they still have tremendous appetite
for recycled paper it's the pulp that is now being exported to
China, which is a way for the Chinese to get access to this
recycled paper that they value without the contamination that they
were so concerned about. Time will tell if these new
facilities are successful, but they are creating jobs here in the U.S. The paper mill jobs are good,
hard jobs that have buoyed communities around the United States
since its inception. In twenty nineteen, there is over
$3 billion invested in recycling and certain economy infrastructure in the
United States, which is and will continue to drive
major job growth. Ultimately, the good environmental benefits
of recycling don't happen when you and I put it in that cart
or they're picked up by a truck or even when they're sorted out, it's
when it replaces new material in the circular economy that you get the
benefits and it has to be clean for it to be that
displace that new material. Collaboration between the people at each
end of a product's life will help reduce the burden on individual
consumers and create a more circular economy. We need to both be
able to design things so they can properly go through
the recycling system. It's communicated to consumers like you
and I on how to recycle properly, but also that there's enough
demand for the materials to, as we say at the industry, to
pull it through the system because somebody needs to buy that stuff for
it to become that circular loop. For too long t here's been
a major disconnect between product designers, brands, recycling facilities
and then who manufactures products. They've unfortunately been operating
in their own silos. A lot of what we do as a
leader in developing the circular economy is connecting all of those organizations
that are actually hyper dependent on each other. One thing that EPA did was to
hold the first ever national recycling summit back in November of 2018. And then that progressed to the
recycling summit that we had held here in Washington, DC, where we
then issued the national recycling framework. And so a lot of activity
now is ongoing to look across the recycling system to improve it. And really ultimately recycling is about
a market and what a market can bear. And the
market basically is changing. It's forcing everybody to focus
on efficiency, product design, reuse of material. The innovation that I'm confident
that the American recycling system will produce will have
some really excellent results.
