More than 8,000 plastic factories in Tongcheng City, Anhui Province, which supplies 60% of the country’s plastic products, have been the first to bear the brunt of the ban, with hundreds of small factories closing down in recent months and medium and large plastic factories facing a shortage of orders.
Called the strictest plastic ban in history, explicitly from 2021, all municipalities directly under the Central Government, provincial capitals, as well as Shenzhen, Xiamen and other five “planned cities”, all shopping malls, supermarkets, drugstores, bookstores banned the use of disposable non-disintegrable plastic bags including dine-in packaging, take-out catering utensils, banned the use of plastic tableware; postal express banned the use of non-disintegrable tape; business travel shall not take the initiative to provide disposable supplies.
So far more than 30 provinces and cities have responded to the ban on plastic.
According to a research report released by the Foresight Industry Research Institute, the production of plastic products in mainland China reached 81.84 million tons in 2019, accounting for about a quarter of the world. However, the annual consumption of biodegradable plastics is only 520,000 tons, accounting for only 4.6% of the global consumption of decomposable plastics, which is significantly lower than the global average.
Haitong Securities research report pointed out that after the plastic ban, it is expected that the plastic consumption of supermarket retail, express delivery and takeaway will be reduced by about 100,000 tons, 1.6 million tons and 300,000 tons respectively, however, this also brings the replacement demand of biodegradable plastics to nearly 2 million tons, which is a new market opportunity of RMB 100 billion.
Affected by the plastic ban, the original end of the year is the peak season of the plastic packaging industry, many plastic factories have to work overtime to catch up with orders. But this year, plastic packaging companies are facing the dilemma of shrinking orders.
Xinjing News reported that Tongcheng, Anhui Province, known as the hometown of plastics in China, has 8,000 plastic factories, 80% of which are concentrated in Xindu town, supplying more than 60% of plastic bags across the mainland.
But at the end of this year, Xindu town plastic factory start rate of only half, and even a factory of more than 20 machines only opened one or two, RuiZhiFeng new materials limited company revealed that in previous years before the New Year to rush to stock, and may also work overtime at night. But this year, ordinary disposable plastic dare not store more.
Manufacturers revealed that domestic demand as well as foreign trade orders shrink, the factory daily production of plastic is only 3 tons, about 60% of last year.
There are even large and medium-sized plastic factories facing order shortages, transformation is not easy, has been out of the game early, there is an annual output value of RMB 2.2 billion, a 60% market share of plastic companies, has declared bankruptcy in November.
Manufacturers are worried that after the implementation of the plastic ban, the industry has seen a major reshuffle.
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