China's New Policy on Waste and Recycling

Recycling reduces the need for extracting (mining, quarrying and logging), refining and processing raw materials. All of these create substantial air and water pollution. As recycling saves energy it also reduces greenhouse gas emissions, which helps to tackle climate change. Materials collected through resource recovery and recycling are 'commodities' that are sold in the market place and compete alongside non-recycled content alternatives.

China is a major player in international trade and is a major export destination for certain recyclable materials around the world, receiving approximately 30 million tonnes from countries worldwide, including Australia.

In 2013, the Chinese Government adopted a policy known as Operation Green Fence to prohibit the import of unwashed and contaminated recyclable materials entering China and increase the environmental standard of all the shipments of recyclable materials coming into China.

In 2017, the Chinese Government announced the introduction of its National Sword program to crackdown on the illegal smuggling of foreign waste into China, targeting industrial waste, electronic scrap and plastics. On 18 July 2017 China announced to the World Trade Organisation that it will no longer accept certain kinds of solid wastes from 31 December 2017. This includes plastics waste, unsorted waste paper and waste textile materials. China will adopt strict 'contamination thresholds' in bales of these materials from 1 March 2018. Contamination can mean the material is dirty, or contains other materials incorrectly mixed in with the bales. Materials can still be exported to China if they have a contamination rate of 0.5 per cent or less.

The current global standard in the recycling industry for contamination is 1.5 per cent, so China's new contamination standards may affect those in the local recycling industry who rely on China to process materials such as plastics, textiles, and mixed paper.

Recycling in South Australia

The waste management and resource recovery industry is a significant sector of the economy with an annual turnover of around $1 billion, contributing more than $500 million to Gross State Product in South Australia, employing around 4,800 people, largely in the local government and the private sector.

For South Australia, the amount of recovered materials exported is relatively small in comparison with the amount re‑processed locally, with 87 per cent of all recovered material reported reprocessed within South Australia, 8 per cent was processed interstate and 5 per cent was exported overseas.

The material exported overseas is made up of mainly cardboard and paper (48 per cent), and metal (41 per cent). Other materials included plastics, tyres and textiles.

In South Australia, some of the material we place in our yellow-lidded kerbside recycling bins, along with material from commercial and industrial sources such as plastic and paper and cardboard has historically been baled and shipped to China to support its economic activities. This is the same for other states and territories in Australia.

The standard of recyclable material collected in South Australia is usually of a very high quality thanks to strongly performing kerbside collection systems and recycling processing plants that sort recyclables into various material streams to reduce contamination. South Australia was the first state in Australia to introduce a container deposit system where collection depots provide a refund on beverage containers, and sort recyclable containers into very specific streams. This system has been in place for 40 years. Nonetheless, our reliance on China as a major export destination for some of our recyclable materials means China's decision to implement bans and new standards on a range of imported recyclables will have a global impact.

As a result it is likely that some of our recycling facilities will need to adjust to meet the new contamination specifications set by China for recycled paper, cardboard and plastics if they want to regain entry into that market. Some of our recycling facilities that export materials to reprocessing plants interstate will be less affected. Alternative overseas markets for South Australia's recyclables such as Thailand, Malaysia, and Vietnam may offer a partial or interim solution but developing local and national solutions will need to play a greater role into the future.

$12.4 million support package for South Australia's recycling industry

A $12.4 million support package for local government and the recycling industry has been released by the State Government in response to China's National Sword Policy. The package includes a range of measures to enable industry investment in remanufacturing and local re-use, as well as improved sorting and processing to enhance the quality of recovered materials. Funding details are available here.

South Australia's Waste Strategy

South Australia's Waste Strategy 2015-2020 recognises the significant opportunity to continue investing in local markets, remanufacturing materials locally into desirable products.

Stronger domestic recycling markets, along with local secondary re-manufacturing, support a robust, sustainable and cost-effective recycling sector, foster economic development and job creation and reduce the risks associated with selling into overseas commodity markets.

With its current strong resource recovery capability, South Australia is well-placed to attract and grow new, potentially high value added, re-manufacturing enterprises and South Australia's waste and recycling sector in particular, is well positioned to deliver new, high technology and advanced industry.