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Operation National Sword Cuts into Recycled Paper Pricing

Operation National Sword Cuts into Recycled Paper Pricing

The recycling industry is bracing for a sharp decrease in the pricing of recycled products, and recovered paper may take the worst of the storm. While several market factors are driving the substantially higher drop for the paper sector of the recycling industry, it's a Chinese endeavor known as Operation National Sword that may be the biggest force behind the fall.

What is Operation National Sword?

As you might have guessed by the name, Operation National Sword is not a policy that was put in place to impact the price of paper. A more accurate Anglicization of the policy's name would be Operation Barbed Wire, although the literal phrase replaces the little barbs with fully-fledged swords. For the majority of 2017, imports coming into China will be thoroughly examined with an equal focus on reducing the amount of waste material being sent to Chinese factories and on reducing the smuggling of drugs, guns and other illegal goods into the country. This isn't the first time that China has made things difficult at the customs office in the same way. In 2013, Operation Green Fence was enacted in response to concerns over the quality of recyclable goods being sent to China for use as production material. Over seventy percent of imports were checked throughout the prior operation, and the current one may be similar in scope.

As one of America's largest trade partners, any change in how China does business can have a rippling effect through the American marketplace.

How Does a Chinese Importation Policy Impact the Price of Paper Here?

As one of America's largest trade partners, any change in how China does business can have a rippling effect through the American marketplace. With China inspecting the bulk of its imports and looking to turn away recyclables that they consider substandard, the demand for American recyclables will suffer. After the year of Operation Green Fence, recyclable imports to China had diminished by over ten percent. These diverted goods then have to be sold in other markets, and the additional supply drives down the cost. This impact will be felt throughout the recycling industry, and other factors such as an already inflated price, a high internal supply in the Chinese market and lingering concerns over quality then pile on to have experts guessing at a fifty percent reduction in the unit price of recyclable paper.

What Does that Mean for the Average Company?

If your company recycles, then you likely sell your waste material to a waste management company like Central Kentucky Fiber Resources, LLC as a way to cut down on pollution and your waste bill. You may also begin seeing stricter requirements for what will be accepted as recyclable. Call us at Central Kentucky Fiber Resources at 859-225-8100 or visit our website to learn more about how Operation National Sword will affect your waste disposal bills.