The Chinese government announced it plans to levy a 25 percent tariff on old corrugated cardboard (OCC) and other recovered fiber, as well as scrap plastic, in retaliation of the latest U.S. tariff proposals. The tariffs will go into effect on August 23.
According to a Resource Recycling report, China’s Ministry of Commerce on August 8 issued the latest list of tariffs the country is planning to implement on imports of goods from both the U.S. and Canada. The list identifies OCC and all other recovered fiber materials among the product codes that would be hit with the 25 percent duty. The action also covers all scrap plastics sent to China, as well as a number of scrap metals.
The tariff codes impacted are as follows:
- 3915 Plastics
- 4707 Paper
- 7204 Ferrous
- 7404 Copper
- 7503 Nickel
- 7602 Aluminum
- 7802 Lead
- 7902 Zinc
- 8002 Tin
- 8104 Other base metals
Major players in the recycling industry, including the Solid Waste Association of North America (SWANA), were quick to comment on the latest tariff proposals.
“SWANA has been concerned for some time that the Trump administration’s trade dispute with China would affect the already diminished movement of scrap and recyclables from the United States to China,” noted David Biderman, SWANA’s executive director and CEO. “If the 25 percent tariff is implemented, I’d expect exports to China to decrease even further. This latest development and its impact will be discussed at the MRF Summit taking place at WASTECON in Nashville on August 22-23.”
In addition, the Institute of Scrap Recycling Industries (ISRI) released the following statement in response to China’s announcement.
“ISRI is already hearing from contacts in China that the announcement has caused consternation among Chinese consumers of U.S. scrap commodities,” said ISRI in a statement. “Although these tariffs will not be levied on imports from other countries, it is our understanding that other regions may not be able to fulfill all of China's demand. This is in line with other reports that the trade war has had an impact on the Chinese economy across many sectors.”
“ISRI regrets that the trade dispute between the United States and China continues to escalate without any indication that the two governments will be negotiating an agreement on trade. There is no doubt that these tariffs will impair the already diminishing scrap exports from the United States to China.”
In 2017, the U.S. exported a total of $5.6 billion worth of scrap commodities to China. Through the first six months of 2018, the total of U.S. scrap exports to China was $2.2 billion, a decrease of 24 percent from the same time frame last year.