In early February 2018, Steve Sutta spoke about his understanding of what is happening in the recycling business vis a vis changes in how the Chinese are doing business.
He said, "We provide what China needs. What they want is really what we provide and have provided for years. We provide source segregated recyclables for commercial and industrial establishments. By their nature, we avoid contamination.
And so, when they take it through the recycling process, the paper mill process, there are just fewer contaminants for their cleaning systems. They have to clean up the water to put back in the rivers so their people aren’t poisoned by someone else’s garbage, whether it’s European or their own or ours. And the way you do that is, at a mill that’s making new cardboard or container board out of old cardboard, if there is only clean cardboard going in, 99.5% of it. Most industrial establishments, whether its Amazon or Kraft or any of the box manufacturers, are putting in real clean material because there’s no way for it to get contaminated. We’ll take that and ship it. They love it. All the mills love it.
In the past, they have been unwilling to pay a premium for it. Now with what they are doing is saying, 'We would rather not have dirty water. We would rather not have dirty air. We are willing to pay a premium price for cleaner material so we have clean air and clean water and our population’s health improves.'
And you can’t blame them.
When you recognize that people who live north of the Yellow River live 5 years less than people south of the river because of the air pollution from the various factories because they’re coal burning and all. When you realize that they’ve closed 35,000 pig farms because the manure from pigs really ruins the water supply, they’re not picking on the paper industry, they’re not picking on the scrap industry, they’re picking on everyone because they’re saying that their people deserve clean air and clean water.
And when you get to that point, when you understand that, then you get to the heart of the issues there. The powers that be in China do not care if it costs more money for cleaner cardboard, they do not care if a box costs 1 or 2 or 5 cents more. What they do care about is having clean air and water, so mixed paper from single stream recycling is not going to ship to China again in our lifetimes. Just not going to happen.
Dirty industries are being forced out of China rapidly, and it has to do with perception of the president of China, President Xi, and the party is being perceived as protectors of the environment, and protectors of the Chinese way, rather than any economic thing that’s involved. We tend to think economics drive everything. In China they don’t. Power and the perceived role of the party drives everything, and often things are scripted, but if you look behind it and you look at what is going to help them cement their power, and in this case you’ve got to remember this group brought more people out of poverty than in the last 30 years in history. And now these people, this middle class in China has all this money, they’re saying 'we want to live longer, we want to live healthier, we want clean air and clean water.'
And so they’re responding to that as a response to maintaining their power base, and if you understand it in that context, then you understand what’s really going on in China. And no other explanation, that I’ve heard from anyone, makes any sense, certainly in the last 30 years understanding China. And right now my contacts, inside and outside China, are about as good as they get on this particular issue."
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