Suffocating, China scrap trade looks to South and Southeast Asia

China's ban of waste imports has disrupted global recycling markets by cutting inflows of waste paper, second-hand clothes and used plastic. While the communist government pursues its goal, Chiho Environmental Group Ltd., the world's biggest metal recycler is discussing joint ventures in developing countries, including in South and Southeast Asia, that would perform the manual dismantling usually done in places such as Taizhou on China's east coast.

The firm's traditional business has it obtain a mix of metals including copper, aluminium and steel from electric motors, cables and wires imported mostly from developed countries. A blanket ban on so-called Category 7 scrap will come into full force at the end of this year, halting that trade.

If Chiho moves its dismantling offshore, material processed there would then be fit to ship to China. China's copper market is tightening after low-grade scrap was banned and the higher grades subject to quotas. Scrap purchases from overseas fell by a third.

(Bloomberg)