Oceans #6: The Future of Plastic Scrap Markets
China doesn’t want our plastic waste anymore. This sent a shockwave throughout the plastic recycling industry and left all of us wondering: where do we go from here? Will new markets open up, or will we (finally) have to deal with our own problems at home? Will the EU Plastic Strategy save us?
In this episode, we discuss the current thinking and upcoming trends on this issue. It’s challenging. We also debrief on the recent live Talk Show in Brussels about European plastics, global markets & China, and set the stage for our next episode where we dive even deeper.
Produced by Camille Duran
Published by Eleen Murphy
Senior Editors Eleen Murphy & Camille Duran
Music Credits: License by Ins. Green White Space.
Eleen Murphy [EM]: Are we in China yet?
Camille Duran [CD]: Hong Kong actually.
EM: Ah okay. Maybe we should remind our listeners how we got here, while the crew throws the anchor?
CD: Sure. In episode four and five of this series about ocean plastic, we reviewed what happens to post-consumer plastic, after you put it into the recycling bin.
EM: We did some GPS tracking internationally to follow shipments and better understand where – and in what conditions – plastic scraps are taken care of.
CD: Not sure you want to know really, but if you do, take it from episode four.
EM: We clarified a fundamental idea: The plastic that’s in the ocean comes from the western world too.
CD: even if much of it gets into the ocean from just a few asian countries.
EM: Yes, a lot of the plastic disposed of in those countries is plastic that we in the west exported there in the first place.
CD: Basically the whole plastic scraps market is…
EM: A race to the bottom.
CD: A race to the bottom.
EM: And we left it at?
CD: Waking the dragon.
EM: Right, it’s getting hot.
CD: Is it really?
EM: Well if I understand correctly what you told us, China, which imports more than 60% of the world’s plastic scraps –
CD: – which we don’t want to deal with at home…
EM: – has decided to ban those low-value imports as of January 1st, 2018. In other words very soon.
CD: Millions of tons of low-grade plastics are going to be blocked by Chinese authorities starting now, pretty much.
EM: Big shake on recycling markets.
CD: Big, big shake.
CD: Conclusion: you have one more plastic Christmas to go, and then, we have to stop sending our trash plastic to China. Okay?
EM: What happens after Christmas?
CD: Well, there is New Year’s Eve, and then usually people go back to work?
EM: No, I’m talking about plastic…
CD: Ah yeah, right… Well that’s what we are going to discuss today. What is the future of plastic scrap markets?
EM: And what is the right thing to do!
CD: [Laughs] The right thing to do?
CD: Do you think people care about what’s the right thing to do?
EM: Uh…I think some people, yes!
CD: [Laughs more]. Okay, okay, we’ll talk about what’s the right thing to do, in case anyone cares.
EM: Our listeners care about the right thing to do, I’m sure!
CD: Okay, okay, I know, I know. Actually I should say: if you are not here to do the right thing, better go live on Planet Mars, I think there is an expedition leaving soon.
EM: We can get you a ticket.
CD: Yes, we’ll pay for it actually.
EM: ok, back to the dragon.
EUROPE REACTS TO PLASTIC WASTE BAN – NEW MARKETS ON THE HORIZON?
CD: So you know we had a live talkshow last week in Brussels where we talked about just this. European plastics, global markets & China.
EM: Yes! Tell us about it, who was there?
CD: A nice mix of people that are dealing with the issue first-hand. It was co-hosted by the Rethink Plastic Alliance, which represents the voice of European NGOs in the plastic debate, and Plastic Recyclers Europe, which represents a large group of European recyclers – actual recyclers, those who operate infrastructure and produce secondary raw materials.
EM: Oh so not the brokers who trade materials on global markets?
CD: No. They were in the room as well, but yeah, it’s another culture and other business objectives.
EM: This is good to clarify actually. The recycler’s objective is to develop domestic capabilities for plastic recycling. The brokers are more interested in finding destination markets for materials, wherever they are… and whatever happens next.
CD: Complete different job and mission.
CD: We also had representatives from Asia, who were in Brussels that day to highlight the impact of European Plastic on Asian Waste Management, and so they passed by the talk show to share a few points. Froilan Grate, Dharmesh Shah…. You know who else was there?
EM: Martin Bourque?
CD: Yes, our recycler turned spy, from our previous episode. And his Chinese contact Liwen Chen. She is an activist & researcher, the one who went on site to inspect the plastic final destination that Martin’s GPS tracker revealed.
EM: Wow, what a panel!
CD: It’s not over. I won’t name them all but worth noticing that a representative from the European Commission was here as well – Anna Ablazevica Policy Officer at the DG GROW – they cover Internal Markets, SMEs, Industry, Entrepreneurship etc.
CD: And Nadine de Greef from FEAD, which is the federation representing the waste management industry in Europe. So yeah, it was good.
CD: So I am not going to redo the whole talkshow here but try to give you the highlights.
EM: Yes and we will post the link to the full briefing. The session was livestreamed and documented, so look for the link in the episode notes.
CD: So there was some discussion about why this ban is happening, did we see it coming bla-bla-bla. And some saw it coming from far (a few recyclers for instance), and some didn’t.
EM: Like the Commission.
CD: Right, and if you don’t see that kind of shake coming, you really can’t adjust in a timely manner.
EM: I see.
CD: Which takes us to the discussion of what is going to happen.
EM: What is going to happen if more than 60% of the market for low-grade plastic disappears?
CD: Well is it going to disappear? or shift to somewhere else?
EM: Oh, you mean that plastic will go to other countries instead?
CD: It’s difficult to predict exactly what is going to happen, and in what amounts but let me put it like this:
Some are worried this low-grade plastic that has no value what so ever is going to go to other asian countries, where the processing standards are often lower than they are in China.
CD: Yes, except for Malaysia maybe. But yeah, that’s a concern. Actually there are many Chinese families that are already moving away to set up shop in bordering countries. And I heard a few times that Africa is going to be the next destination for the trash. Countries like Nigeria seem to be ramping up as a destination for plastic scraps.
CD: Now let’s be clear, no country can take what China was taking in quantity. Far from it.
CD: So yes, probably a good part will spread on new markets.
EM: And the rest?
CD: And the rest is probably going to be dealt with in Europe.
EM: What do you mean?
CD: [Coughing] Incinerated.
CD: [Coughing] Burnt.
EM: Ohh, so we’re going to burn what we can’t export…
CD: Yes, our good friends the cement kilns and waste to energy plants may have a couple of years more work before we can close them down.
EM: Well, at least this way we will be breathing our own plastic from the air of our own cities, instead of sending our trash around…
CD: Yeah, some of it at least. Martin who runs a recycling program in California says that the price per tonne he has to pay to export it is reaching the price of landfilling it in California.
EM: So maybe that’s going to force us to go from “not in my backyard” to “in my backyard?”
CD: At least for a part of the stream.
EM: Okay so in the next couple of years, some will probably reach new markets, and some will probably be burned here in Europe?
CD: Some millions of tonnes, yes.
EM: Ouf. Hey, what is the likeliness that other Asian countries will follow the Chinese policy, and ban plastic scrap imports too?
CD: It is a possible scenario and some even call it an upcoming trend. Difficult to say at this point, but yeah, it could happen.
EM: And so then what?
CD: So if all those contries start to refuse all this low grade plastic coming from Europe and the U.S….I let you imagine.
EM: We’d finally have to deal with our own sh*t at home!
CD: You mean like internalising the impact and cost of our plastic? [Laughs].
EM: It is really that far fetched? I mean, isn’t the EU setting up it’s plastic strategy at the moment? This Chinese ban is a huge opportunity in the long term. Perfect timing for integrating ambitious measures that avoid this low-grade plastic being put on the market in the first place!!!
CD: Haha, Eleen, you’re funny. Okay. So you want to talk about the EU Plastic Strategy, right?
EU PLASTIC STRATEGY AND LEGACY BUILDING – WE’RE TIRED OF THE SMALL STUFF
CD: Sorry to spoil it, but we are not talking about a weapon that could kill a dragon just yet.
EM: Tell me more.
CD: Let’s bring our container ship back to Europe then.
EM: Can we take the Suez canal this time? It’s shorter.
CD: Not afraid of pirates?
EM: I am one of them, remember?
CD: Ah yeah, how do you do it again?
CD: Ah yeah right. Back to Europe then.
CD: Ok, so those of you who have been following our series on the Circular Economy know that the European institutions are currently cooking a Circular Economy policy package which is supposed to take us to a resource efficient Europe.
EM: Yes, we have seven episodes about this.
CD: Now as part of that process, it was announced that the Commission would come up with a Plastic Strategy by the end of the year, to lead the way, bla-bla-bla.
CD: And it’s a process where industry and brands are perceived as very influential, I should say?
EM: Hm, and why do you say that?
CD: There was several versions of the draft that were leaked over the last few weeks, and you can see the evolution of the text.
EM: Evolution in what direction?
CD: Well, there are some measures that are being weakened as time goes by.
EM: Measures like what?
CD: We are going to talk about it, it’s a bit delicate. But first…But first:
Something that struck me many times since I follow this discussion of circular economy, plastics and change in general.
EM: Oh no, i know you, you’re warming up for a punchline somewhere…
CD: Have you ever thought about your legacy, Eleen?
EM: I’ve never thought about it ever in my entire life, Camille.
CD: Really? How you will be remembered, what trace you left on society, on the planet, what was your impact?
EM: Um, maybe I should think more about this, yeah.
CD: You’re doing great by the way.
EM: Heh. Where do you want to go here?
CD: Some people care about their legacy more than others. But politicians and brands do care. Very much.
EM: That’s for sure.
CD: Brands care because it is directly connected to their equity, to their value on markets and to their survival even. Most politicians care about their legacy too. It is the fuel for a political career.
CD: Ask yourself: who do you remember a few years down the road?
EM: Oh no…he’s going to transform, I just know it… Sorry guys, this happens sometimes.
CD [Transformed]: Ask yourself: who do you remember a few years down the road?
The people who did the small stuff, the shy policies, the soft measures that do not make any waves? The incremental game that no one wins in the end?
Or the people and brands who got on their horses, jumping ahead of the curve, those who drive change without fear, the real innovators that make the world measurably better?
EM: The second one…?
CD [Transformed]: Which one:
The people and brands who are on the defence serving consumers and voters the bullsh*t that everyone can smell from kilometres away? Playing the clock, the mandate, the quarterly results?
Or the people and brands who show real passion, conviction and who dare attacking a problem at the source. Even when it’s risky, when it’s early, when others are still talking?
EM: The second one again. The real problem solvers!
CD [Transformed]: That’s who you remember. You want to be the first-mover into a future that’s already there. You want to lead and inspire, not cheat and conspire. You want to go beyond intentions. Beyond just a vision. Leave the small stuff to others. You’re here for what really matters. You want to be the one people talk about, or tomorrow you’ll be out.
CD [Transformed]: Once and for all. The one people look up to because you have big ba- um…
EM: Big ideas!?!
EM: Wow, are you back? You okay? What was that?
CD: Yeah, you get the point. We are tired of the small stuff.
EM: I feel you. So that’s your introduction to the EU Plastic Strategy chapter?
CD: That’s my introduction to being a human being on Planet Earth. We deal with change everyday.
EM: So this applies to the debate on plastics.
CD: I think so. And that is what we are going to cover in next episode. What is the small stuff, what is the ambitious stuff we can hope for? Where will we fall, and how do we go from there?
EM: What legacy is this Commission going to leave behind? Coming soon on Green Exchange.
CD: Share the podcast with your friends and colleagues. We are going to start talking about lifestyle, movie stars, and real solutions to the ocean plastic problem.
EM: You know where to find us!
CD: We’ll be back soon with more green knowledge, inspiration – and legacy checks. Keep up the good work in the meantime.