Operation Green Fence: Key Questions Answered

Operation Green Fence is a policy designed to more fully inspect incoming secondary commodities, including scrap, with a goal of prohibiting the import of unwashed and contaminated material entering China. Operation Green Fence is often cited as a key factor in the current problems facing the scrap market. Here are some basic questions and answers about this Chinese policy:

1
What is Operation Green Fence (OGF)?

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 It was a crackdown undertaken by the Chinese environmental and customs officials to more robustly inspect all the shipments of secondary commodities such as scrap metals, plastics, paper, textiles and rubber from Europe, North America and elsewhere from February 2013 to November 2013. More specifically, it was a 10 month effort by the national custom agency of China to prohibit the import of unwashed and contaminated materials into China.

2
What was the scenario before OGF?

One of the top exports to China from America since 2007 has been recyclable materials. In 2011, the United States exported metal and paper scrap worth $10.8 billion to China. It was a win-win situation for both U.S. and China. China had been exporting various kinds of consumer goods to the U.S. and the shipping containers were going back empty. So, U.S. companies started to send waste paper, recycled cardboard boxes and other scrap in the return-trip containers. Gradually, it became an indispensable part of municipal recycling programs in U.S. Sources reveal nearly 75 percent of aluminum scrap, 60 percent of scrap paper and 50 percent of scrap plastics that U.S. used to export every year before OGF was exported to China. In 2011, 52.8 million tons of paper and paperboard was recycled in the U.S. and nearly 15.87 million tons of that was exported to China. In the same period, the U.S. exported $500 million worth of recycled plastics to China. However, that convenient arrangement was endangered by OGF.  

3
What was the main purpose of OGF?

The simplest purpose of the campaign was to increase the environmental standard of all the shipments coming into China. It appears that 'zero tolerance' to banned items such as medical waste, food waste, animal, insects, human/animal wastes, green waste, textiles, and e-scrap in bales was the main motive of the campaign.

Wang Jiwei, Secretary General and Vice President of the China Nonferrous Metals Industry Association Recycling Metal Branch (CMRA), stated at an ISRI convention that the intention of the OGF was to bring psychological changes to all the shippers and make them know that every shipment into China would be strictly examined and their import application and license could be canceled if caught sending sub-standard materials to China.

4
What regulations are involved with OGF?

There was no new officially declared regulation regarding OGF. In fact, it strengthened Article 12, which was issued in April 2011. The article states, "In the process of importing solid waste, measures shall be taken to prevent it from spread[ing] seepage and leakage or other measures to prevent pollution of [the] environment." According to sources, anything more than 1.5 percent contamination in any bale was rejected by Chinese custom officials.

5
How much material was rejected by China custom officials under OGF?

In the first three months of enforcing OGF, about 55 scrap transactions and 7600 tonnes of recyclables from the U.S. were rejected. Within the six months of enforcing OGF, the rejected amount reached to 800,000 tons of recyclables. Within the same period, 247 companies lost their import licenses as well. The final rejection numbers at the end of the 9 months is yet to be known.

6
How has OGF impacted the worldwide waste and recycling industry?

The impact of OGF has been huge. The OGF crackdown worked as a warning from China to the U.S. and European recyclers. So, European and U.S. recyclers had to find alternatives or improve their recyclables processing facilities. More importantly, reducing contaminants from the recyclables required higher costs at the same time the crackdown lowered the market prices of the recyclables as well.