The global dynamic of the recycling trade
In the United Kingdom, recycling is seen by many as a localised issue. What we throw away from our homes and workplaces everyday into an assortment of recycling bins is controlled by our local authorities who collect, measure and offset it against their own, localised targets for reducing the amount of waste going to landfill. Yet the collection of our recycling is only one half of a story which is actually global in scale and represents a multibillion dollar industry worldwide (Roberts, 2012).
The trade in recyclable materials internationally is not a new experience. As early as the First World War, waste ash and grease was traded across Europe for the making of bricks and explosives respectively (Brinker, 1919). The rapid rise of metal trading throughout the 1970s however led to the recycling phenomenon we currently see in Chinese cities, where the hugely lucrative trade in scrap materials is fuelling a large part of the Asian economy.
China has arguably become the new international hub of recycling. Scrap materials are transported there from the USA, the EU and Japan primarily, but also from every large consumer market of China’s goods. For the most part these scrap materials are metal based: lighting ballasts, copper cables, iron based car chassis, aluminium radiators and electric motors (China’s largest source of copper) are all collected from around the source countries by specialist dealers and exported in huge quantities each week to factories in China where they are stripped down and the metals resmelted. An average US international scrap metal dealer will spend US$1 million a week on scrap metal before export costs and some US dealers have even moved their operations permanently to China in order to increase profit margins further.
This is not to say that the recycling of metals only happens in China. Omnisource, a company operating out of Fort Wayne in Indiana, USA is home to the largest plant in the world specialising in the recycling of cables. Using a heavily mechanised and computer controlled process, cables are fed through a machine which stands larger than a football pitch and a metal ‘grain’ is produced which can be melted down for the production of new copper. While the process is highly organised and regulated, it is also expensive and so Omnisource will only recycle cable with the highest grade of copper and with the easiest level of extraction.
The remaining lower grade cable gets shipped to China, where the process for extraction is a lot simpler. At the cable recycling plant in Chizhou, Anhui Provence, a machine resembling a wood chipper is used, through which cables are diced and mixed with water to create a metal soup. The metal is then put through a process similar to gold panning whereby copper and plastics are separated over a water table. The remaining copper is ninety-five per cent pure and the plastic particulates are even collected and made into flip-flops: a fantastic example of green processing.
With such ease of extraction one has to question why the USA and the EU do not undertake this process themselves. The answer is simple – China recycles most metals because China has the highest demand for metals. Forty three per cent of global copper demand comes from China and it satisfies forty per cent of this demand from the recycling of materials that it imports from overseas.
Infographic: The Global Recycling Trade
Activities and Questions
Using the infographic on ‘The Global Recycling Trade’, compare the data from the three pie charts. What does this tell us about the future sustainability of using copper as a component in consumer electronics?
One could argue that the global trade in scrap material has been made possible by ‘containerisation’. Research the meaning and history of this term and describe how the story of recycling has been reliant on this process.
Is recycling a truly global activity? Look at the infographic on ‘The Global Recycling Trade’ and assess the extent to which this is true.
The economic viability of international recycling
Considering the increasing fuel costs for the global transportation of goods and materials, one could justifiably question the economic validity of transporting recyclables between continents. What these costs mask however is that scrap materials taken to China generate an enormous income for the recycling plants involved in their processing. Recycled copper can fetch up to £4.75 / kg and aluminium £2.80 / kg on the London Metals Exchange (LME, 2014) which in the quantities passing through plants at Foshan and Chizhou in China has created a lucrative industry.
With recycling becoming so profitable, a further consideration has to be the reasons why the producers of the scrap (namely the USA, Europe and Japan) do not process it themselves. One reason relates to the effort and labour needed to strip and treat the recyclables. Scrap metals are rarely bought in an unmixed form as many are fashioned into alloys as part of the manufacturing process. Extra components such as plastic in casings and containers mean that stripping and sorting the scrap can be a labour intensive process for those companies not willing to invest in the huge machines needed to do the task for them. In China there is a large labour force willing to work in this industry and more importantly they have skills (such as the visual recognition of different grades of metal) that make recycling far more viable. The extra substances in the scrap such as plastics are no deterrent either: these are frequently collected as a by-product and used to make cheap consumer items such as plastic sandals.
A second reason why China is taking on the world’s recycling is because the county has become the biggest market for the recycled materials themselves. The demand for ‘second-hand’ metals is especially high in China: copper in particular finds its way back into consumer electricals (such as mobile phones and circuit boards) that the country is marketing within its own borders as well as exporting in huge numbers to developed nations. Therefore it makes enormous economic sense to import a raw material at a heavily discounted rate in order to increase profit margins on manufactured goods.
The nature of containerised transport systems also benefits Chinese recycling firms. While sending manufactured goods from China to the USA is relatively expensive, to return a single container back to China empty is a waste of resources time and money for most shipping companies. The solution would be to send back to China goods that have been manufactured in the USA but therein lies a further problem: the USA is not producing any goods that China cannot manufacture itself cheaper. A far more cost effective solution is to return the containers at a heavily reduced rate of £185 per container (about eight times less than their outbound journey of £1500 per container) and to fill the containers with scrap material that the USA cannot otherwise process. Therefore, as long as the developed world continues to consume cheap Chinese goods, there is little incentive for this economically symbiotic relationship to end.
Infographic: The Economic Viability of International Recycling
Activities and Questions
Why do manufacturers not make their products easier to recycle?
What economic conditions might lead to the breakdown of cheap containerisation for recycled goods? Discuss this with a peer and estimate how likely it is your different scenarios will happen.
Take a simple component such as a filament light bulb from a string of decorative lights. Estimate how long it would take for you to safely identify and remove the different metallic elements the bulb contains, and how much it would cost in labour based on the UK minimum wage. If tungsten is worth £20 / kg, are you able to make a profit if you process 1000 light bulbs which collectively contain 20g of tungsten? If not, how much faster would you have to work, or how much less would you have to be paid?
Challenging perceptions of the recycling trade
Recycling in the developing world could be seen to have an image problem. It is common to find descriptions of children sifting through the scrap that has been dumped in huge piles on the edge of their cities. In the past it has been seen as a common home of exploited labour and further morals are called into question when thinking about how we deal with e-waste.
Though the scrap business is far from a fully regulated and objective body, there is evidence that there is in places a greater subtly to its manner than we may at first believe. Recycling can be found at the heart of families’ private industries: it still falls on home workshops to process and recycle a lot of the scrap metal that enters China. Despite the reasonable profits that can be made from this processing, home workshops may exist because these families occupy the poorer edges of society or indeed come from victimised sections of city communities, such as the Jewish diaspora in New York city and the Ankui migrants in Shanghai. The low literacy levels needed to be a recycler and the informal nature of the work means it is open to large swathes of migrant populations, where more advanced opportunities remain closed to them.
Recycling at the big plants takes place in clean and well ventilated workshops; conditions that are essential for processing micro components in recyclables such as microprocessors. Scrap employees in China can earn up to £440 per month compared to the national average of £250 per month (International Labour Organisation, 2013) and skilled labourers on the processing line on the factory floor can earn twice that of their office managers, challenging the idea of widespread exploitation in the industry. Recycling firms have become large employers of women who demonstrate a high level of skill in being able to sort and grade scrap metals by eye: as such they are very high demand and create a working practice that becomes associated with a great deal of dignity.
The morality of reusing recycled materials has also been called into question. In Guiyu, China, where the world’s largest plant for recycling electronics is found, microprocessors are meticulously removed in clinical conditions. These microprocessors are then resold and placed in new components, which may be without the parent company’s consent, making the process potentially a form of ‘green fraud’. It is happening on such a vast scale that few companies have the ability to police it.
Evaluating these recycling practices is far from a simple process as at its core lies the recognition that any recycling of metals saves further mining for new ore in environmentally sensitive areas. This is an important consideration given that on average 165 kilograms of ore is mined for every kilogram of copper produced. With positive social and economic aspects to recycling being evidenced in China, it may be difficult to find counterarguments to its continuance. Different scales of analysis may reveal differences in perception: China’s gains may be to the detriment of the European Union and while transporting recyclables to China may be a viable option now, its effectiveness may decline as African nations become more industrialised and economically competitive.
Infographic: Challenging perceptions of the recycling trade
Activities and Questions
Use eight variables to create an impact assessment on a bipolar scale of recycling through China. Try to use a variety of social, economic and environmental factors to score and then make a decision on the extent to which recycling is sustainable.
Who is responsible for policing the recycling industry? Make a list of players who would be involved and discuss with a peer each of their capabilities to fulfil this role.
How has the identity of a recycler changed over time?
Conclusion
The profile of recycling has been changed dramatically by the rise of China industrially. As well as becoming the powerhouse of consumer goods manufacturing, the nation has also invested in ways to deal with waste – a growing problem with which the developed world is either unwilling or too ill-equipped to cope. Such change in circumstances has changed our view of recycling and our perceptions of those employed at its ground level work, and created a strong economic model for other developing countries to follow. However as the morals of handling some types of e-waste become of greater concern, the future of recycling may become less well-defined and a new model for dealing with such scrap may need to be found.
Glossary
Recycling
The process by which waste materials are changed into new products. As well as reducing the need for the extraction of natural resources from the environment, it also prevents waste materials from being burnt or left in landfill sites, which damages the environment further.
London Metal Exchange (LME)
Founded in 1877 in London, the LME is the world’s largest market for the future buying and selling of metals. They deal with delivery contracts between metal ore extractors and manufacturing industries.
Import Substitution
A process by which the importing of foreign made products is stopped in favour of making those same goods in country, reducing the country’s dependency on foreign industries. This practice has traditionally been deployed by the Asian Tigers and more recently by China.
Containerisation
A large scale transport system that uses steel shipping containers to move cargo effectively over large distances. The containers’ standardised dimensions mean they can be easily moved from one mode of transport to another (e.g. from ship to train or truck) without the need to unload at each stage. The containers and their contents can also be tracked more easily using a simple computerised system
Reduce, Reuse, Recycle
A hierarchy of processes that aims to protect the environment by decreasing the amount of waste that ends up in landfill. It says that one’s first priority in dealing with waste is to reduce the amount of waste one creates (for example by reducing the amount of packaging around food products). One should then try to reuse the waste in its original form (but possibly with a new purpose) before finally recycling it.
E-Waste / E-Scrap
The discarded devices or parts of devices of an electronic origin. It forms the fastest growing sector of salvaged material and large numbers of people from nations such as China and India are informally employed in its recycling, sometimes through dangerous and morally questionable practices.
Exam Style Questions
GCSE:
With reference to a named resource, describe the inequalities seen in its patterns of production and consumption (6)
Describe how technological processes can create a more sustainable world (8)
Explain how recycling can reduce an individual’s eco-footprint (4)
A Level:
Evaluate the success of a large scale waste management scheme (12)
Analyse the extent to which ‘green practices’ are creating a fairer world (10)
Evaluate the impact of outsourcing for a specific global industry (10)
References
Brinker, J. (1919) Out of the Garbage Pail – Into the Fire, Popular Science Monthly
International Copper Study Group (2013) World Copper Factbook
International Labour Organisation (2013) Global Wage Report 2012-2013, International Labour Office, Geneva
London Metal Exchange (2014) Pricing and Data
Roberts, N. (2012) Recycling industry now worth £23bn in UK, Materials Recycling World
Unless otherwise stated, all data in the above piece relates to figures taken from Adam Minter’s lecture: Junkyard Planet (Nov 2014)