It’s a complex, global marketplace for recovered materials. While individual communities can’t control market forces, it is wise to understand the underlying landscape. Partially excerpted from Resource Recycling magazine, here are some recent developments.
Recovered material prices have been volatile in recent times as Chinese import changes have developed. On May 3 China made another alarming announcement that it was implementing a month-long shutdown of China Certification and Inspection Group’s North American arm. This is expected to freeze U.S. scrap shipments to China over the coming weeks.
Old corrugated cardboard (OCC) prices had already taken a deep dive in preceding months, causing some materials recovery facilities to lose revenue and raise tipping fees. This has been a boon to domestic mills that use OCC to make containerboard, saving them millions, but the currently tight freight market has cut into those gains.
China’s National Sword initiative has caused a glut of mixed paper in the U.S. Without China’s absorption, this material commands little to no value. It is uncertain whether mills in North America will be able to take in enough mixed paper to compensate; however, at least one company has started making significant investments to start handling more. In the long term, demand for fiber packaging is expected to continue to grow, so the economic balance may be restored eventually.
In the plastics recycling sector, there have been recent reports of domestic reclaimers adjusting to take in material that was previously destined to China as well as news of processors from China angling to open operations in North America.
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