The enforcement of China’s Operation Green Fence is undoubtedly having a profound effect on exports of recyclables from the UK with reports of materials being quarantined at ports and significant caution being exercised by producers and exporters alike.
The Green Fence initiative was launched by the Chinese Government at the beginning of the Year as part of an all-round effort to improve the county’s environmental performance, and at some ports, particularly main ports in Southern China, between 70 and 100% of containers are being opened at the ports and checked for quality issues.
The Recycling Association firmly believe that all of our UK members are complying fully with Transfrontier Shipment regulations. However, we do have concerns that the Chinese authorities may be adopting a non-scientific, subjective approach, and may impound and eventually repatriate material that we believe is compliant.
We are in unknown territory here and this is producing a more cautious approach with many UK exporters, particularly brokers, choosing either not to directly export some of the lower grades, particularly mixed papers, which would appear to be specifically targeted, or sending orders to other export destinations. That said, we hear stories from the US of good quality OCC (cardboard) being sent back for excess moisture content at just 15% (cardboard has a natural moisture content of c. 10%). Excess moisture is usually the subject of a claim by the re-processing mills, not the reason for repatriation.
A concern in the UK is that that the initiative will have a negative impact on demand and lower prices. Recovered paper prices on the brown grades have softened slightly into April, but not to the extent where alarm bells are ringing at the moment, and the Green Fence initiative has actually coincided with a drop off in demand from China anyway due to poor order books for finished products.
The Recycling Association firmly believes a partnership approach is required to further improve the quality of the materials we supply from the UK – this may start with, for example, the local authorities and will lead through to the processors and ultimately the exporters. Every link in the chain has a duty of care to ensure that quality standards are met. If we do this, then in the medium to long-term we will have products that will be in high demand in China and elsewhere.
There may well be some short term pain, and we do hear of unsubstantiated rumours of material being sent back to the UK, but if we can ultimately meet quality standards across all grades of materials and treat them as a commodity, not a waste, then China will buy this product. They rely on our supplies and I firmly believe that after a few months, things will settle down and all good quality materials will be welcomed into the country and we can continue our long-standing supplies and partnerships.
Simon Ellin, chief executive of The Recycling Association