Recycling Markets:
A Look at Trends Amid Global Trade Realignment
ASTSWMO Joint Hazardous Waste and Materials Management Training
Hilton Milwaukee City Center, Milwaukee, WI
August 13, 2019
David L. Wagger, Ph.D.
Chief Scientist / Director of Environmental Management, ISRI
• ISRI Introduction
• U.S. Recycling Industry
• Recycling Industry Fundamentals
• Recent Trends in Scrap Trade
• North American Market View Ahead
• ISRI’s Initiatives and Partnerships
• Review
Copyright © 2019 Institute of Scrap Recycling Industries. All Rights Reserved.
Contents
2
Voice of the Recycling IndustryTM
4,000+
41Countries
Members Locations
©2018 ISRI, Inc.
1,300+
Ferrous & non-
ferrous metalsPaper Plastics Tire &
Rubber
Textiles Electronics
Manufacturers,
Processors
Industrial Consumers,
Brokers, Traders,
Equipment/Service
Providers
Copyright © 2019 Institute of Scrap Recycling Industries. All Rights Reserved.
3
Workplace
Safety
Market Intelligence
SpecificationsEducation,
Training &
Networking
Responsible
Recycling
Awareness
OUR MISSION
Design for Recycling™
To promote safe, economically sustainable & environmentally
responsible recycling through networking, advocacy &
education.
Free & Fair
Trade
Copyright © 2019 Institute of Scrap Recycling Industries. All Rights Reserved.
4
Voice of the Recycling IndustryTM
©2018 ISRI, Inc.
125,000,000+ Tons processed annually
Iron/Steel 66.0 Copper 1.9 Plastics (bottles) 0.8
Paper 46.1 Lead 1.1 Electronics 5.0+
Aluminum 5.3 Zinc 0.07 Tire (#) 110
In millions of tons (or other unit shown). 2017 Data (except Plastics and Tires, 2016)
$117B Economic activity $13.2B federal, state & local tax revenue
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5
U.S. Recycling Industry: A Snapshot
1. Recycling is a Commodities Business Driven by Demand
– ISRI’s Scrap Specifications play a key role
• Provide the global standard for consistency & quality
• Reflect tolerances allowed by materials manufacturers
• Common language
• Inbound MRF Specifications Expected in 2019
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Recycling Industry Fundamentals
2. Recycling is far more than residential recycling … it is “Bigger than the
Bin”.
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Recycling Industry Fundamentals
3. Recycling is a Global Business.
– Total Global Scrap Consumption = 800 million metric tons
– Total Global Scrap Trade = 180 million metric tons
– The U.S. and China are/were key players in the global scrap market.
• Total Exports from U.S. to 155 Countries = 37 million metric tons
• Total Imports into China from World = 43 million metric tons
8Copyright © 2019 Institute of Scrap Recycling Industries. All Rights Reserved.
Recycling Industry Fundamentals
June 2018: China announces intention to ban
“solid waste” imports by 2020; but recent draft
change to law softens this.
July 2017: China Ban on post-consumer
24 categories [mixed paper; residential
plastics; eff. 1/1/18]
March 2018: final carried waste
standards take effect; remain
below global stds U.S.
Recycling
Industry
Brands want their products deemed
recyclable & able to go through the
residential recycling stream2019: Ban on post-industrial
scrap & category 7 metals
Long term contracts without flexibility to address
current conditions
Wishcycling
US-China Trade War
China imposes retaliatory tariffs on scrap (25% for all, 50%
on Al scrap); U.S. scrap suppliers facing retaliation in form of
export license renewal delays
Public confusion
What can go in the bin? What
can’t?
August 2017: China proposes
“carried waste” standards on ALL
scrap at levels far below global stds
Processing equipment/infrastructure designed to
produce grades for which there is no longer demand
Time needed to create demand
within the U.S.
Recycling equipment mfg report sharply improved
equipment orders; therefore sig. delivery delays
Lack of consistent messaging;
uniform labeling
Enforcement varies from community
to community
Freight costs/driver shortages
Chinese State Council Policy Statement
of 2017 Still Reigns
Exposes Domestic Challenges
Prices for certain banned commodities (e.g.,
mixed paper) have plummeted, forcing review
of municipal recycling programs
May 2019: Suspension of CCICNA for one month
- complete halt of scrap exports to China
©2018 ISRI, Inc.
9
Pressures Placed on U.S. Recycling Industry
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2020: Ban on SS scrap &
nonferrous scrap (ex Al & Cu)
6
8
10
12
14
16
18
Per
cen
t
Total Unemployed + marginally attached and part-time for economic reasons (U-6)
*Bureau of Labor Statistics via St. Louis FRED
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Other Pressures: Tight Labor Markets
©2018 ISRI, Inc.
U.S. Scrap Exports to Mainland China
Jan-June
20184.81 mmt
Jan-June
20193.27 mmt
YTD % CHG -32%
0
5,000,000
10,000,000
15,000,000
20,000,000
25,000,000
1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
U.S. Exports of Scrap Commodities to China 1996-2018 (metric tons)*U.S. Census Bureau // U.S. International Trade Commission
China’s accession to the WTO
Great Recession
Operation Green Fence
Blue Sky
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Snapshot of Scrap Trading with China
“Scrap plastic exports
plummet 43% this year,
paper stable”
(Resource Recycling News,
August 6, 2019)
©2018 ISRI, Inc.
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Recent Exports to China: Mixed Paper
0
50,000
100,000
150,000
200,000
250,000
Jan
Fe
b
Ma
r
Ap
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y
Jun
Jul
Au
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p
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Fe
b
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Au
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Jan
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b
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2016 2017 2018 2019
Monthly U.S. Mixed Paper Scrap Exports to China (metric tons)*U.S. Census Bureau/U.S. International Trade Commission
Recent Exports to China: Plastics
©2018 ISRI, Inc.
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0
10,000
20,000
30,000
40,000
50,000
60,000
70,000
80,000
90,000Jan
Fe
b
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Jun
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Au
g
Se
p
Oct
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Jan
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b
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Jun
2016 2017 2018 2019
Monthly U.S. Plastic Scrap Exports to China (metric tons)*U.S. Census Bureau/U.S. International Trade Commission
Not Just U.S. Exporters Who Are Hurting
©2018 ISRI, Inc.
0
200,000
400,000
600,000
800,000
1,000,000
1,200,000
1,400,000
Jan.2017
Feb.2017
Mar.2017
Apr.2017
May.2017
Jun.2017
Jul.2017
Aug.2017
Sep.2017
Oct.2017
Nov.2017
Dec.2017
Jan.2018
Feb.2018
Mar.2018
Apr.2018
May.2018
Jun.2018
Jul.2018
Aug.2018
Sep.2018
Oct.2018
Nov.2018
Dec.2018
Jan.2019
Feb.2019
Mar.2019
Apr.2019
European (EU-28 incl. UK) Scrap Exports to China (metric tons)*Eurostat
Plastics Paper Ferrous Nickel/Stainless Aluminum Copper
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Trade diversion keeps materials moving…
Re
co
ve
red
Pa
pe
rPla
stic
s
Source: U.S. Census Bureau / U.S. ITC
CountryFAS Value/Metric Tonnage % Change
(Jan-June)2017 2018 Jan-June 2018 Jan-June 2019
Indonesia$8,307,152 $9,247,584 $2,731,091 $7,478,758 174%
29,175 27,385 8,468 17,940 112%
Malaysia$31,472,356 $57,682,689 $45,192,592 $6,091,756 -87%
121,125 204,120 157,756 20,209 -87%
Thailand$10,772,518 $43,338,915 $36,971,442 $3,591,428 -90%
32,862 106,853 91,438 11,608 -87%
Vietnam$49,389,260 $27,433,415 $23,959,981 $3,370,496 -86%
137,042 74,396 70,560 9,041 -87%
CountryFAS Value/Metric Tonnage % Change
(Jan-June)2017 2018 Jan-June 2018 Jan-June 2019
Indonesia$76,869,462 $148,560,435 $57,524,231 $78,463,363 36%
440,418 1,160,870 443,753 617,247 39%
Malaysia$4,423,641 $17,801,478 $3,466,479 $12,155,913 251%
23,569 111,767 24,833 87,041 251%
Thailand$41,992,638 $58,267,854 $19,166,267 $34,694,878 81%
282,221 468,632 153,971 289,550 88%
Vietnam$58,125,566 $112,469,273 $49,094,438 $64,788,923 32%
399,652 765,880 362,426 488,594 35%
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Alternative Markets
…but illegal demand pull results in a policy backlash.
Re
co
ve
red
Pa
pe
rP
last
ics
Source: U.S. Census Bureau / U.S. ITC
Although the largest growth market, India grapples with its
own domestic collection problems.
Country FAS Value/Metric Tonnage % Change (Jan-June)
2017 2018 Jan-June 2018 Jan-June 2019
India$58,336,236 $50,065,543 $26,469,445 $26,315,728 -1%
123,116 133,299 69,725 70,777 7%
CountryFAS Value/Metric Tonnage % Change
(Jan-June)2017 2018 Jan-June 2018 Jan-June 2019
India$377,874,613 $531,077,913 $281,589,186 $271,124,328 -4%
1,926,002 3,337,998 1,813,330 1,597,199 -12%
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16
Alternative Markets
Future Global Trade Pressures
• China as eventual net-exporter of scrap material
• Reactive import restrictions across Southeast Asia will continue and
strengthen
• Basel Convention Decision on Certain Plastics (Eff. 01/01/21)
– OECD’s potential adoption of Basel Convention Decision
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North American Market View: Paper
• Since China’s ban on mixed paper (MP) and 0.5% limit for old
corrugated containers (OCC)
– At least 17 NA mills designed or converted to use MP or OCC on-line since 2018 or
scheduled on-line by 2021
– Best case: adding 3.5M tons of new OCC/MP processing capacity from 2018-2021
– Incentives to use MP, vs. OCC, are currently limited, but improving MP quality helps.
18Copyright © 2019 Institute of Scrap Recycling Industries. All Rights Reserved.Source: ”Gearing Up”, SCRAP, July/August 2019
North American Market View: Plastics
• Domestic recyclers increasing quality and/or adding processes to meet
domestic supply and demand (examples)
– GDB International: Pellet production from HDPE, LDPE, LLDPE
– Far West Recycling: Improved PET bale quality (90%→98%)
– CarbonLite: New rPET facilities in TX and PA
19Copyright © 2019 Institute of Scrap Recycling Industries. All Rights Reserved.Source: ”Asia’s Plastic Scrap Shake Up”, SCRAP, May/June 2019
ISRI’s Initiatives and Partnerships
• Trade missions to China, India, and Southeast Asia
• Leadership role in U.S. EPA’s “America Recycles Dialogue” and
America Recycles Week activities (Nov. 11-15, 2019)
• Design for Recycling®
• The REMADE Institute, Founding Member
• “A Better Bin: A Campaign For Strengthening Residential Recycling
Across the U.S.”
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Copyright © 2019 Institute of Scrap Recycling Industries. All Rights Reserved.
Design for Recycling®: Key ISRI Concept
Since ~1990, ISRI’s Design for Recycling®
principles seek to increase sustainability of consumer durables:
• Eliminating or reducing use of hazardous substances and material impediments to the recycling process
• Maximizing use of recycled materials
• Maximizing yield of recyclable materials at end of life
• Working with stakeholders to achieve above goals
Institute of Scrap Iron and Steel. Phoenix Quarterly. 1986, 18(1), 8-10.
Design for Recycling® Award
21
2019 Awardee: Nestlé Waters NA
Pure Life® 100% rPET 700 mL Bottle
The REMADE Institute
• Reduced EMbodied-Energy And Decreased Emissions Institute for Sustainable Materials Manufacturing
– A Manufacturing USA® Institute funded by DOE
– $140M/5-Year Public-Private Partnership in 1:1 Match
• Goal: To drive down the cost of technologies essential to reuse, recycle and remanufacture materials
• 4 Material Types: Metals; Used Electronics; Polymers; and Fibers
• 5 Focus Nodes– Systems Analysis & Integration
– Design for Re-X– Materials Optimization
– Remanufacturing
– Recycling/Recovery
• ISRI has been involved in REMADE and its development since 2013.
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REMADE Projects Involving Paper or Plastics
• New Approaches to Improve Deinking Flotation to Increase the Availability of High-Quality, Low-Cost Recycle Paper Fibers - Virginia Tech
• Assessment of the Impact of Single Stream Recycling on Paper Contamination in Recovery Facilities and Paper Mills – University of Miami
• A Dynamic Techno-economic Systems Modeling Framework for U.S. Fiber Recycling - Northwestern U, Yale U, ISRI
• Identifying strategies to maximize benefit of fiber recovery through systems quantification - MIT, AF&PA, WestRock, Graphic Packaging
• Reinforced Recycled Polymer Composites - Oklahoma State University, Niagara Bottling LLC, Shaw Industries
• Scalable High Shear Catalyzed Depolymerization of Multilayer Plastic Packaging – University of Massachusetts-Lowell, Michigan State, Unilever, ACC, National Renewable Energy Laboratory
• Systems Analysis for PET and Olefin Polymers in a Global Circular Economy – Michigan Technological University, American Chemistry Council, Idaho National Laboratory
• Mapping the Material Base for REMADE –Yale University, Unilever, International Zinc Association, Massachusetts Institute of Technology
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A Better Bin Poll Results (2018)
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Review
• Domestic and global markets have been disrupted in the aftermath of
scrap import restrictions by China.
• Demand exists for high-quality recyclables.
• Domestic investments in processing and quality improvements are
happening in response to supply and demand.
• Market optimism and uncertainties co-exist.
• ISRI is working to improve recycling on multiple fronts.
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Thank You!
Acknowledgments
Bernie Lee, Research Analyst, Commodities
Adina Renee Adler, Asst. VP, International Affairs
Joseph Pickard, Chief Economist/Director of Commodities
David L. Wagger, Ph.D.
Chief Scientist / Director of Environmental Management
Institute of Scrap Recycling Industries, Inc.
202-662-8533
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