Exports of secondary raw materials such as waste paper to China could continue for an extra year until 2021 at least, reports from China have indicated.
Over the past twelve months, strict quality controls have been implemented by the Chinese authorities alongside a plan to stop the imports of “waste” such as paper for recycling, (for example, used cardboard and over issue newspapers) by 2020. But, now there are suggestions from Chinese sources that the total ban on imports, if it is to happen, will not be imposed before 2021.
The decision, should it be confirmed, is seen as giving considerable extra breathing space for Chinese mill buyers of used cardboard and also for UK exporters to plan ahead for the ban. The market changes are of particular note to the UK as it has been, and still is, a major exporter of material to China, especially when compared to the rest of Europe.
While a 2021 deadline would be encouraging, in the short-term within the UK it seems likely that stocks of used cardboard could build up at transfer stations and at retail sites during November as exporters wait for licences to be issued to Chinese mills for the import of material from 2019. Without these licences, there is something of an impasse in the sector although there are some hopes that some licences might be issued in about four weeks.
And, a 2021 deadline will also give the Chinese mills more time to develop their overseas operations. There is wide expectation that the mill groups will aim to build more paper mills overseas, importing reels of cardboard material into China rather than making it there, with also the possibility of making a pulp like material overseas and importing it to the mills inside China.
Only last week, Lee and Man Paper which has mills in China – and Mark Lyndon as its buying agent in the UK – announced that it is to build a huge production plant at Sepang in Malaysia. The facility would produce 700,000 tonnes of paper and more than 500,000 tonnes of pulp.
Edmond Lee, chief executive of Lee and Man, was reported in the South China Morning Post as saying: “We see Malaysia as a competitive location for export to China.”
Last month the UK government confirmed that Chinese mills are looking at developing sites in the UK as well as on the European mainland (see letsrecycle.com story). There is some suggestion that this could involve the conversion of newsprint machines to make cardboard materials in light of the decline of newspaper readership.