This past summer, Van Dyk Recycling Solutions sponsored and hosted a webinar titled "MRFs in Crisis! Where do we go from here?" During the webinar, Van Dyk's sales manager and process Engineer, Adam Lovewell, along with colleague Mark Neitzey, focused on the topic of how recycling businesses have been struggling to deal with China's changes in import policy. According to Lovewell and Neitzey, the so-called "China crisis" has exposed serious issues throughout the recycling industry and "we have hit a critical point where owners and operators need to take a hard look at their equipment's ability to handle changes in the stream."
Lovewell says the topics focused on in their webinar were similar to the conversations being had around the industry on a regular basis this year, including at the first MRF summit, held at Wastecon 2018 in Nashville. He says the conversation centres around broad questions including: What can the recycling industry do considering the challenging global climate we find ourselves in? Where can materials go? And what does the future look like for paper, plastics and other recyclables?
Roots of a crisis
Lovewell says that in the simplest terms, the current crisis in the global materials recovery industry stems from China's import policies which have come into place since 2017.
"The MRF crisis has everything to do with our inability to ship material to China," explains Lovewell. "The latest stage (called BlueSky) which began in the Spring of 2018, where they completely shut off North American exports for a period of time, is what started the crisis, because nobody really knew where to go with their material - especially fibre - everyone has been frantically trying to find buyers.
"And then there are the restrictions that China has put on quality. They've now said that recyclers can start shipping material to them but that it has to meet a very high quality specification. For fibre, the specification is at half of one percent contamination levels. It's not economically possible to really reach that quality for medium to large MRFs. Volumes of material are just too high."
In particular, the specifications for fibre, including mixed paper, newspaper and cardboard are extremely challenging to meet. "If MRFs want to be shipping end product to China, they have to slow down their throughput, and add sorters and equipment," he says.
Plus, due to the risk of shipping material and it not being accepted at Chinese ports, there is a high potential to have ships turned around, with product rejected and sent back to its source. At about an average of $10,000 per container to have material re-routed back to North America, it's very costly. "And then you still have to do something with material when it comes back," says Lovewell.