[Hwankyung Ilbo] In 2022, Korea's automobile exports amounted to $54.1 billion. Tire cords, airbags, sound-absorbing materials, seat belts, wheel guards, cushioning materials, and carpets are representative automotive interior and exterior materials. Tire cords, which are fiber reinforcements that go inside the tire rubber, increase durability and stability. Recycled fibers make up 50% of automotive interior and exterior materials, 20% of bedding, 15% of clothing, and 15% of materials for building, civil engineering, and agricultural products. Recycled fiber is also the raw material for the non-woven fabric used to make the noise-proof chairs. There are more than 50 domestic companies that produce recycled fiber, which is used so much that it is hard to find a place where it is not used.
The use of recycled fiber has increased globally due to increased production of electric vehicles and emphasis on noise and flame retardancy. On the other hand, Korean recycled fiber companies have to worry about their survival. The recycling boom around 2018 led to the creation of many recycled fiber companies, but last year, several companies closed down. It's not that the entire industry is in a downturn because it hasn't been able to respond to changes. Most companies agree that South Korea's recycled fiber production technology is as advanced as any other country in the world. However, they point out that the shortage of raw materials is pushing the industry to the brink.
The domestic recycled fiber industry exports more than 50% of its production (330,000 tons per year, valued at $346). The raw materials for the production of recycled fiber are PET, yarn, film, sheet, and polymer bulk. The raw materials are crushed into flake chips and popcorn chips, which are made into the final product, fiber (short fiber).
The Ministry of Environment (MOE) announced the imported waste items on June 30, 2020. PET was designated as an Article 2 import prohibited item (waste synthetic polymer compounds) along with PP, PE, PS, etc. The reason for the PET import restriction was to "promote domestic waste recycling. In this regard, the recycled fiber industry believes that the ban was influenced by concerns that importing PET would reduce the unit cost of distribution, which would reduce recovery and cause environmental pollution. They argue that the ban was a unilateral sacrifice in the process of raising the unit price and increasing the recovery rate.
As a result, after the announcement of imported waste items in June 2020, recycled fiber companies lost existing customers and weakened their export competitiveness due to raw material shortages and rising prices. According to data from the Korea Environment Agency, the price of PET (variegated) compressed products increased from KRW 233/kg in 2020 to KRW 515/kg as of August 2023. Currently, the utilization rate of the domestic recycled fiber industry is 80 percent.
It's easy to see why the MOE banned the import of PET, but it's hard to hear the voices of the small businesses that are suffering as a result. We visited some of the 50 recycled fiber companies in the country that are facing a survival crisis to find out what problems the ban on importing recycled fiber raw materials has caused and what discussions are needed to solve them.
For the full article in Korean, see related articles↓