Tariffs And A Trade War Threaten U.S. Paper Recycling

There’s a trade war going on between China and the United States. Billions of dollars in new tariffs have been levied on aluminum and steel and also on recycled paper pulp. While not as well known, the levy on the little-known waste product could bankrupt an already taxed recycling industry.

China’s latest round of retaliatory tariffs against the U.S. includes something called “recovered fiber materials,” basically, recycled paper, the newspapers and cardboard that we put in the recycle bin. Recycling trucks collect paper, bundle it up at local centers, and sell it as bales, mostly to China, to be remanufactured into new products. It’s the cycle of recycling. And now there’s a potential tariff on those exports....

...In May, Nine Dragons (China company) bought two pulp and paper mills in Maine and Wisconsin...

"So the strategy is coming to invest in the United States, instead of exporting the waste paper directly,  but the process, they buy the paper mill, to process the waste paper, and to turn it into the paper pulp. So, theoretically, these are much cleaner, these are not classified as recycled products," said Chen.

Arguably, as Chen says, if the new product is not classified as recycled paper, it would avoid a potential tariff.

"So now, instead of processing that in China, and Nine Dragons, for example, those companies, they process the waste paper in the United States," said Chen...

   ...more

Ken Notes: So we eliminate a market for the product and now make it in the US. We still return the product and any profits from the process back to China??? What happens when China figures out that it can just buy Ford and Apple and H-D and...