As promised, restrictions are coming from other countries, such as Thailand, Taiwan, and Vietnam. The U.S. continues to consider other avenues that are left, as overseas options are becoming scarce. This week, Berg Mill provides market updates regarding Thailand’s scrap ban, Taiwan’s import regulations, and Vietnam declining to issue permits.
Thailand’s Scrap Ban is Here to Stay
Thailand has begun taking steps toward a more sustainable future by making their scrap ban a permanent change. Resource Recycling describes, “Two months after the country enacted an immediate prohibition on scrap plastic and e-scrap imports, the country’s government has released its longer-term plans.” The country’s scrap material imports have increased dramatically this year, especially after China’s new regulations took effect. Thailand has seen more plastic imports, and the Thai government wants to implement an effective, long-term policy.
Within two years, a complete ban on scrap plastic can be expected from regulatory agencies working to refine the policy. Resource Recycling reveals Natural Resources and Environment Minister General Surasak Kanchanara stating, “Some business operators may make a lot of profit from the recycling industry, but what will the country gain from their prosperity when our environment becomes polluted and the people suffer?” Though the timeframe does seem brief to put the policy into effect, Thailand is determined to alleviate the waste problem.
Taiwan’s Recent Regulations
In following the footsteps of other Southeast Asian countries, Taiwan is taking the necessary steps in preserving their health as well. They have also experienced a significant increase in scrap material imports this year, but their import system follows a different model. The scrap import system is not regulated well, but this will be changing. Resource Recycling explains, that to fix the problem, “…the Taiwan Environmental Protection Agency drafted regulations that will restrict imports.” The changes will only allow certain types of plastics and paper for import. Mixed paper and scrap plastic imports will be affected. Though we understand their environmental goals, it still poses a challenge for domestic material. We believe that only the mills in Taiwan will be permitted to import scrap paper. There were numerous brokers supplying these mills and this will most likely no longer be the case.
Vietnam’s New Changes
Vietnam has also been greatly impacted by the recycling challenges. Additionally, they have noticed a drastic increase in scrap paper and plastic this year. In July, the Vietnamese government announced they would decline licenses for waste imports due to port backups and piled up containers. Resource Recycling quotes RISI mentioning, “The change is a clear sign that the government is strengthening the control of [recovered paper] imports.” The country is making these modifications along with reinforcing restrictions on import permits.
Scrap plastics seem to be an area of struggle for the country, as the import volumes show large reductions. Domestic materials are not meeting quantity or quality standards, creating an area of concern for the Vietnam Plastic Association. Officials noted that an import ban should be expected in the future along with reduced waste imports.
The U.S. has encountered a barrage of problems since the import bans first took effect, and it does not look like the wave of issues is about to come to a halt. Domestic materials are piling up, and recycling stakeholders continue their search to find a home for them. Unfortunately, there are not enough resources or time to make the types of investments and advancements that will introduce a substantial impact. West Coast programs are depending on domestic solutions and considering opening the WestRock paper mill in Oregon to alleviate the accumulation.
Recycling may be going through a temporary crash, but it is not disappearing. Increased education will greatly impact the recycling stream. It may become costlier to recycle but sending material to landfills is not a long-term strategy. Within the next year, there will be new capacity in the U.S. to handle mixed paper and OCC, possibly in Georgia, Ohio, Wisconsin, and Oregon.
At Berg Mill, we continue to work hard to overcome fluctuating commodity markets, opening markets in other countries, forging strategic alliances, and improving domestic processing capabilities. The rest of 2018 will be undoubtedly difficult. We would like to help you move off any paper, plastic, or metal scrap. Berg Mill has the expertise and know-how to navigate through these troubled waters. The next obstacle is Ramadan, as the countries celebrating the holiday that are left taking scrap will shut off the U.S. scrap market, disrupting the correction further.
Berg Mill has a long history as one of the pioneers in the industry, and we are not going anywhere even when faced with these challenges. Every day we are making progress, as new homes start to become more and more real for your material whether it be paper, plastic, metal, textiles, etc. If you continue to handle large amounts of recycled waste and are looking for solutions to offload idle scrap, please contact our industry veterans at Berg Mill Supply.