China’s ban on imported waste plastics is a boon for a local manufacturer of recycling machinery.
For decades the U.S. shipped waste plastics to China, where it was melted down and processed to fuel the country’s rapid economic growth.
It meant that the U.S. and other developed countries that exported trash did not have to develop infrastructure to recycle and reuse their own plastic waste.
That abruptly ended in July 2017 when China announced a ban on imported waste, including plastics, paper products and textiles.
The ban came after China reported that a lot of the plastic was degraded with food, garbage and other pollutants. The new policy, which was implemented on Jan. 1, 2018, was designed to protect its environment and help it manage its waste better.
The ban was a wake-up call for U.S. municipalities, which have struggled to process the increase in waste that was previously sent overseas. More plastic has ended up in landfills, and some municipalities stopped collecting recycled material altogether because of a lack of infrastructure to process the waste.
RELATED STORY: Plastic Money
But what has turned out to be a headache for many districts has become a windfall for a Lebanon, Oregon-based business, which makes machinery that enables companies to recycle and manufacture products from waste plastic.
Entek, which employs 428 workers in its Lebanon facility, makes so-called twin-screw extruders, which are tools that can melt down plastic materials. Users can add ingredients to the melted material, which can then be processed into a finished material that can be manufactured into other products.
Entek’s customers include food-packaging companies, medical manufacturers and makers of landscaping products, such as decks, fences and garden furniture.
The company was already seeing increased demand for its twin-screw extruders before China’s plastics ban came into effect, says Linda Campbell, vice president of sales. Entek expanded its extruder manufacturing facility in 2015 by 35,000 square feet to cope with the extra demand.
Entek employees make extrusion parts onsite at the company's Lebanon facility
Then came China’s ban; that is when the “phone started ringing,” says Campbell.
“It was a perfect storm for us: The ban came and we were there where our competition wasn’t,” she says.
In 2019 the company landed so many orders for twin-screw extruders that it overachieved its budgeted revenue by more than 200%, she says.
Increasing the use of recycling in manufacturing has obvious environmental benefits. One ton of plastic takes up 30 cubic yards of landfill space.
Though Campbell says she can’t say for certain that China’s plastics ban is the direct cause of the uptick in orders, she says companies are trying to understand how they can increase the value of recycled plastics.
“If you can melt plastics, add color, add ingredients, now you are talking about making furniture, decking, fences,” she says.
A twin-screw extruder demonstration project
The company is also partnering with Oregon State University’s forestry department to research ways the technology can be used to recycle waste wood.
Entek’s entry into the plastics recycling business was driven by economic necessity rather than by choice. Its original business line is making membranes that are used in acid batteries found in electronics, such as laptops, and cars.
The company was founded in 1984 by James Young, who had developed a membrane that acts as a separator in lead-acid batteries. To make the product, the company needed an extruder to process the materials into the finished product.
It used to buy the extruders from a client in Germany. But it soon found that the extruders wore out quickly, and the German client charged a lot of money for replacement parts.
So Entek started making extruders itself for its main battery lead-acid separator product. Once word got out that there was a U.S. producer of extruders, “we started getting calls from customers in the U.S.” wanting to buy the replacement parts, says Campbell. “So we started a side business.”
It started manufacturing twin-screw extruders in 1995. Now it has 280 mainly U.S. customers that buy the product.
Campbell estimates the company has 15% market share for extruders. The battery membranes remain the largest part of its revenue. But the twin-screw extruder business is growing rapidly and accounts for between $25 million and $35 million in revenue, says Campbell.
The growth means it is bursting at the seams in its Lebanon facility. It plans to double its office space, and it had to add 56 new spots to its overcrowded parking lot.
It is an unexpected growth spurt that proves having to deal with your own trash not only has benefits for the environment — it can benefit business, too.
To subscribe to Oregon Business, click here.
- KEEN Grants $10K to Oregon Tradeswomen for child care and other services
- Betsy Johnson: Oregon Voters ‘Feeling Left Out’
- Biden Says Infrastructure Bill Will Bring Oregon Into the Economy of the Future
- Oregon-China Trade Grows, But Leaders Fear ‘Decoupling’
- Oregon senate passes mattress recycling program bill