The Society of the Plastics Industry hosted a webinar on July 2 to address some ongoing questions about China’s Operation Green Fence enforcement operation.

The panel of presenters which included Kathy Xuan of PARC Corp., Dr. Saurabh Naik of IEI, Dave Kaplan of Maine Plastics and Mike Biddle of MBA Polymers presented an overview of how Green Fence had affected their operations, offered new information on where the enforcement action was headed, and fielded questions from listener participants. The webinar was moderated by Kim Holmes and Michael Taylor of SPI.

The panelists indicated that lower volumes of plastic scrap are simply not being shipped to the country anymore, and there is also widespread confusion as to whether Chinese customs or China Certification and Inspection are in charge. There are reports of CCIC approved containers later being rejected by customs.

“Within three months of the enforcement, 55 transactions and 7,600 tons of materials were rejected,” explained Kathy Xuan. “Of the 1,044 companies with import licenses, 247 saw their licenses suspended.”

All participants agreed that while the enforcement is technically scheduled to end in November, it will likely stick around for a long time. Speakers said that the current slowdown is reminiscent of the period following the 2008 economic collapse and indications from their partners in China are that the situation is unlikely to return to normal.

“This isn’t the first time we’ve seen something like this. When the recession hit, we had this kind of problem with containers being held up. More and more countries in Southeast Asia are going to be competitive. We need to be more aggressive in finding markets,” said Saureen Naik of IEI. “More and more countries are going to be competitive for material. This policy is really an opportunity for us to take a look at what our footprint is and understand how we can come up with new technologies and alternate means for recycling our own scrap.”

For its part, SPI says it is looking into whether the enforcement action constitutes anti-competitive practices by the Chinese, and will explore legal and political options if it does. For now, however, all panelists are advising Western processors to expect more of this operating environment in the future.

“China tends to pick and choose policies to crack down on, depending on how severe and how public the problems,” said Michael Taylor. “They like to appear to do something dramatic to increase their legitimacy. Their earlier anti-corruption campaign is a good analogy. Crackdowns will reoccur. This space is going to be problematic from here out.”