With the export ban on whole used tyres fast approaching, Tyre Stewardship Australia has launched a Baler Transition Program to support market evolution.
In late May, the Council of Australian Government’s ban on waste exports was delayed due to COVID-19 restrictions.
In a statement at the time, Environment Minister Sussan Ley said the effects of COVID-19 made it “impossible” for parliament to pass legislation in time for the 1 July 2020 deadline.
However, Ley assured industry that the Federal Government would not waiver on its commitment to the ban, with the delay set to solely impact the proposed timeline for unprocessed glass.
At the time of writing, the schedule for implementing the ban on tyres, plastic and paper remained unchanged.
Despite the pandemic’s effect on ban legislation, the waste and resource recovery industry has demonstrated great resilience and adaptability.
Many, including Tyre Stewardship Australia (TSA) CEO Lina Goodman, are using the unprecedented global environment as a learning opportunity and time for reflection.
“The impacts of COVID-19 have almost given us a sneak peak of what may eventuate when the ban comes into effect,” Goodman explains.
“Today, we are seeing the detrimental impact reduced markets, both on-shore and off, are having on the sustainable disposal of used tyres.”
When the ban was first announced, Goodman notes that some argued a ban on baled tyres could come into effect immediately.
The reasoning: there is already enough local processing capacity, so the market would be fine. In Goodman’s view, however, this line of thinking is too simplistic.
“Having the infrastructure and ensuring material gets to the gate at a competitive price to ensure it is processed safely are two very differing concerns,” she says.
“Also, as the recent past has evidenced, you can process all you want, but you’re still in trouble if the product has nowhere to go.”
As such, Goodman says domestic market demand is now more critical than ever. She adds that if foreign tyre derived fuel demand falters, Australia, and the global sector, will be critically exposed.
“As global demand for used tyres shrinks, and nations close down manufacturing and grapple with the management of COVID-19, the consumption, collection and disposal of tyres continues,” Goodman says.
As collectors start to emerge from the impacts of COVID-19 and the diminished value of their material, TSA hopes two things will happen.
“Firstly, recyclers can survive the recent set back, secondly, there is enough will and determination to get back on to their transition plans in the lead up to the December 2021 deadline,” Goodman says.
“TSA is concerned that a change in collection prices will encourage unscrupulous behaviour to enter the market, this may result in increased illegal dumping, stockpiles and unnecessary burden on reputable recyclers.”
Presently, Australia, like many nations including the UK and parts of Europe, is finding it difficult to move collected material to countries that were traditionally a home for these products.
Late last year, India’s National Green Tribunal directed the Central Pollution Control to restrict the import of waste tyres. In 2018-19, India received 47 per cent of Australia’s tyre exports.
“There is no easy fix to this problem – particularly as this may be a persistent trend with declines in oil and coal prices reducing demand for tyre derived fuel – which is often a substitute for such commodities,” Goodman says.
“However, Australia does have something that many other nations lack – a growing market for crumb rubber across a range of sectors.”
Since inception, TSA has committed $6 million to support projects designed to increase the use of used tyres in Australia.
Goodman notes particular progress in the roads sector, with collaborative TSA projects seeing WA’s crumb rubber consumption double in two years.
When the export ban on all whole used tyres commences, approximately 70,000 tonnes of material is set to be directly affected.
According to the Phasing out Waste Exports Response Strategy, Australian businesses that rely on the export of whole baled tyres, particularly passenger tyres, have expressed concerns about the impact of the ban on their viability.
To support those operators, TSA began a new Baler Transition Program in April.
Open to all TSA and non-TSA participants, the program is designed to help operators engage more broadly on their current business model, and the changes required to remain in business beyond the December 2021 deadline.
“The support TSA can offer includes co-ordinating “virtual” round table discussions with relevant state-based authorities to help navigate through approval process requirements, provide guidance on possible solutions and connecting organisations with other commercial entities,” Goodman says.
According to Goodman, balers that have an appetite to transition towards greater recovery efforts require support in multiple ways.
First, lengthy timeframes for approvals needs to be addressed. And second, there needs to be an increased understanding of issues such as power, suitable site location and the importation of additional recycling equipment.
Importantly, Goodman says regulators managing approval processes need to understand that the tyre recycling sector is proactively attempting to get business ready.
In addition to the Baler Transition Program, TSA has been actively contacting affected parties to discuss the scenarios, business impacts and potential changes the ban will deliver.
“Upon the announcement of the export ban, TSA immediately engaged with relevant stakeholders to understand the implications, the support required to assist exposed businesses and impacts of the proposed ban on the sector more broadly,” Goodman says.
TSA is also engaging with responsible authorities such as EPAs and state governments to communicate how the ban and other emerging factors are influencing current market circumstances. As well as the implications this has for the effective management and regulation of the sector moving forward.
“TSA is also in a unique position where we engage with other tyre management schemes around the world,” Goodman explains.
“As such, we have used our international networks to better understand global factors and how they are influencing local market circumstances.”
As reported by Waste Management Review in May, TSA’s Used tyres supply chain and fate analysis report suggests recent decreases in stockpiling are partially attributed to increased volumes of baled tyres being exported.
“There’s no doubt that baling over the years has substantially influenced the orientation of the market locally and globally. If it didn’t, why would the industry have pushed to ban it?,” Goodman says.
“Conversely, it would be hard to deny that once baling is removed from the market that there will be a big adjustment to these changing dynamics.”
There is an expectation, Goodman explains, that this will occur when the ban is enacted.
“However, in a sense, the ban is somewhat superfluous at the moment. With decreasing Indian demand for bales through policy changes and global trade disruption via COVID-19 – we’re already seeing the bale market disrupted to the point of cessation as there is lack of trade outlets for baled material,” she says.
“Now, this is a point in time due to multiple global market factors – but the end result is a curtailing of bale outlets from Australia – which in effect, is the same impact as a ban.
“Unfortunately, we are seeing extreme stress on the market with blocked outlets to foreign end markets, this is leading to businesses under stress, finding it difficult to deal with accumulated feedstock.”
Goodman adds that these circumstances may not prevail and may be alleviated should markets open up and COVID-19 be better managed globally.
“However, what it does demonstrate is that the resource recovery industry, regulators and organisations such as TSA need to work together proactively,” she says.
“We need to use technology to better manage sites. We need to work across jurisdictions in a coordinated way – because each state is affected by global circumstances in common ways, so we need a common and coordinated approach.”
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