European recyclers consider opening new markets, like India

GUANGZHOU, CHINA  — Europe’s plastic recycling industry is too dependent on China as a market and should work to open up scrap exports to places like India, the Middle East and Africa, according to the head of one of Europe’s plastics recycling trade groups.

China and Hong Kong together took 90 percent of Europe’s 3.3 million metric tons of scrap plastics exports in 2009, leading to a dependency that’s a “serious” problem for European recyclers, said Surendra Borad, chairman of the plastics committee of the Brussels-based industry trade group the Bureau of International Recycling.

“If the Chinese plastics market sneezes, we get a cold; if the Chinese get a cold, we develop fever; if the Chinese get a fever, then we develop pneumonia,” he said in a recent BIR statement.

In an Aug. 12 email to Plastics News, he said BIR is working to open markets in India, for example, and believes that country could “easily” import up to 1 million metric tons of plastic for recycling a year, five times current levels.

Borad is also chairman of Gemini Corp. NV in Antwerp, Belgium.

The difficulty with India, according to Borad, is that the government considers plastic scrap a waste, rather than a potential resource, so it limits imports. Except for PET, only about 30 companies in India can bring in plastic waste for recycling, he said.

“BIR is regularly in contact with the environment ministry in India, for example, to ensure that there should not be fresh restrictions,” said Borad, who was reelected to a new term as head of BIR’s plastics committee in June. “BIR was very successful in reducing the restrictions on imports of metal scrap.”

Besides PET, India has strong demand now for clean low density polyethylene, he said.

India’s position contrasts with China, where about 7 million metric tons of recycled plastic are imported each year because that country considers it a potential resource, Borad said.

Chinese imports of plastic scrap from Europe hit 3.3 million metric tons last year, up from 2.24 million metric tons in 2008, as European consumption dropped and market dynamics pushed more exports to China, he said.

Other plastics recycling groups in Europe have taken a different point of view than BIR, suggesting that European governments instead should limit exports of scrap to Asia.

In a statement last year, the Brussels-based European Plastics Recyclers trade group said the increase in exports was hurting European recyclers, and it said Chinese and other Asian recyclers had an advantage because they operate with much weaker labor and social standards, including in some cases using child labor.

But Borad said BIR argues to European government agencies that they should not restrict free trade: “It is not possible to recycle all kinds of plastics scrap in Europe.”

He said there should be more efforts toward standardization of scrap.

Borad said plastic scrap imports to China from all countries went up in early 2010, to 1.8 million metric tons from January to March, but there has been slackness in Chinese imports in the last three months, although with signs of a pickup last week, he said.

He said exports to the Middle East and Africa could be developed but will take more time.

BIR represents 700 companies and 40 national associations involved in recycling many different materials.

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