National Sword Continues to Disrupt US Exports to China

China’s 2017 crackdown on scrap imports, known as the National Sword, threatens US exports and recovery rates and may have broader economic consequences.

Patty Moore, recycling expert and president of Sustainable Materials Management of California, has voiced concerns over falling US scrap exports, saying material recovery rates may suffer as the availability of downstream users decreases. According to Moore, MRFs are simply unequipped to produce the higher grades of scrap China demands.

Exporters continue to suffer heavy volume losses as they have been unable to recover since China’s 2013 scrap import crackdown known as Green Fence. One California-based resin exporter, who suffered a 40 percent drop in volume from the last crackdown, has suffered another 40 percent cut to export volumes. The current crackdown is primarily affecting post-consumer mixed plastic imports.

The National Sword is particularly hard-hitting as the US was once able to send tons of low-grade material to Hong Kong and the rest of China. Last year alone, Hong Kong and China received 69 percent of all US plastic scrap other than PET.

Material bans and high import and transportation fees are financially squeezing both US sellers and Chinese buyers. Domestic US buyers able to handle mixed-plastics can now charge for accepting these bales, while many small Chinese buyers of low-grade scrap are threatened with the possibility of business closures.

The continuing crackdown may even have far-reaching economic consequences outside of the scrap industry as studies show US recovered commodities exports produce $28.85 billion in total economic benefits.

With no end in sight, some companies are working toward diversifying markets by opening operations and trading in other parts of Asia.

Click here to read the full story from Resource Recycling and subscribe to our newsletter to receive updates on the effects of China’s crackdown.

Stay connected with our team in the office and in the field. Follow us on Facebook and Twitter, and get connected on LinkedIn.

Comments are closed.