As China’s environmental condition deteriorates it caps GDP; waste needs to be a commodity
By Gregory Jackson
A rice farmer in Hunan Province, China, known for contaminated heavy metals in the soil. (Photo: by Sim Chi Yin for New York Times).
Pollution is an unnecessary economic hindrance for GDP per capita measured by the composite environmental score, which is calculated by a country’s carbon intensity, pesticide regulation, fishing exploitation, clean water, air quality, and soil health, according to Yale. Yale Environmental Performance Index (Yale EPI) has measured that as countries improve environmental conditions on a scale from 1 to 100 (1 = worst and 100 = best), countries with $100,000 GDP also have EPI scores of nearly 80. China’s EPI score was 28 in 2014, with GDP near $9,000 making it the worst of environmental conditions in emerging markets, affecting their soil.
“Cadmium rice” in Guangdong has attracted attention drawing a relationship between cadmium contamination in the soil and economic output limits if untreated wastewater from nearby smelting plants and mining for coal near rice farms continue without standards. The wastewater has been used as water for rice farms.
In Hebei, Henan, Guangdong, Anhui, and Jiangsu these regions accumulatively account for 25 percent of China’s total GDP in 2012, but the highest cancer rates. The Chinese Ministry of Environmental Protection (they have one?) has estimated it will take $1.6 trillion for soil remediation.
Other farmers in China have resorted to hand-pollinating their crops, according to Dr. Terry Root, senior fellow at Stanford University’s Woods Institute.
Food crops have been known to uptake minerals and nutrients available to them in the soil. For instance, iodine in the soil can be absorbed into vegetable crops to benefit nutrient consumption by us; the same is true for reverse affect. Eating rice grown in cadmium laden soil is absorbed into the rice grain. Eating this rice will concentrate about a third into our kidneys and one-fourth into our liver and stays their according to its half-life, at least 17 years to 38 years. Experts warn the health risk of consuming cadmium set at two gram limit, if consuming it all.
“Adjusted for the stage of its economic development, China’s environmental conditions are worse than any other country in the world,” writes Michael Cembalest, chairman of market and investment strategy for J.P.Morgan Asset Management. “These results stem in part from China’s use of coal.”
In Eye On the Market Outlook 2015, Cembalest writes from a post-zero interest rate world and monetary easing, tracking how China’s GDP global contribution was 5 percent in 1990 and has grown to over 40 percent in 2010. Whatever happens in China has strong gravitational pull for other emerging markets, but is slowing down.
“China’s capital spending boom is finally peaking, ushering in a transition to greater reliance on consumption and service sector activity,” writes Cembalest. “China has the tools to manage this (low fiscal deficit, low levels of central government debt, large amounts of central bank reserves), but the growth and commodity price consequences are being widely felt… Chinese capacity growth was financed by corporate debt, and this capacity has brought down China’s overall utilization rate and the rate of corporate profits growth.”
Air, water, and soil pollution are dragging down Chinese economy.
Since 1960 clean water availability has fallen by half, 300 million Chinese lack safe drinking water. Beijing air pollution PM score of 2.5 (>2.5 microns in diameter) once averaged 100 microns per cubic meter, 300 in October 2014. The World Health Organization standard for a PM score of 2.5 should be 25, not 300. And soil pollution awareness has reached a point where farmers do not eat their own crops because of cadmium, mercury, and lead soil contaminants.
“In 2030, China may still burn the same amount of coal as it does today. This is despite massive investment in renewable energy,” Cembalest continues. “While China may succeed to reduce coal’s share of primary energy from 68 percent to 58 percent, its energy demand will grow as well, so that volume of coal burned remains the same.”
Percentage base renewable energy diversification depends on the amount consumed. If China’s population grows by 100 million in 15 years, a ten percent reduction in coal use will not make a difference.
What China needs is sustainable supply chain commodity market ecosystems.
For example, since mining for coal generates wastewater laden with heavy metals that have been used to water crops, sustainable wastewater solutions are needed. To use wastewater for watering crops is to reduce waste (of water), then necessary industrial water filtration engineering infrastructure is needed to revive China’s economy and protect its food from contaminated soil.
An investigation into China’s organic waste market is also required, to learn if the country faces similar food and organic waste recycling challenges as developed countries face. If so, serious efforts will be needed to remediate soil with experts like Canadian companies like Nelson Environmental Remediation, who use thermal desorption units, to cleanup shale oil spills in North Dakota. And then have market ecosystem relationships grow to connect unsuspecting markets like organic or toxic waste recycling, renewable energy, and organic food. You have to think in terms of cadmium as commodity and extraction process from soil and wastewater from mining – perhaps centrifuging and filtering heavy metals from it – and use the recovered heavy metals in productive uses.
Cadmium is used in rechargeable batteries, coatings, pigments, alloys, and cadmium telluride used in electronics and construction of solar panels. Cadmium should be sustainably sourced to supply these industries.
Cadmium in metal finishing is ideal for airplane landing gear, automotive parts like break discs and door hinges, and coatings to prevent corroding. Duray Plating Company since 1963 in Cleveland, Ohio uses chrome to plate mechanical parts and suggests that metals like cadmium need safety controls and common sense to use.
“I have observed of how manufacturing has been so regulated that the large companies have been forced in part to move operations to Mexico, China, and India,” said Ken Roth, president and owner of Duray Plating Company and Vice President of Ohio Association of Metal Finishers, “where environmental and safety controls are still minimal or non-existent though there have been some improvements.”
These innovations most likely will be met by Chinese small and medium enterprises (SMEs) listed on Shanghai and Shenzhen markets, not state-owned enterprises. Although Chen Jining, former president of Tsinghua University has been named China’s new environment minster; he recently congratulated Chai Jing’s film, “Under the Dome” examining China’s serious pollution challenges. Perhaps under new environmental regulations that respect these metals, SMEs and state run enterprises can create a performance standard, closed-loop resource goals, where waste from one market is fueling growth in another, sustainable disposal applications could be achieved.
Part of the predicted $1.6 trillion cost to remediate farming soil will involve metal extraction for commodity markets as mentioned in cadmium applications, but for those metals that may remain in the soil, phytoremediation may be needed.
When the American Society for Nutritional Sciences (ASNS) reported three plants to uptake cadmium from contaminated soil, they planted Thlaspi caerulescens and bladder campion (Silene vulgaris) both compared to ‘Rutgers’ tomato (Lycopersicon esculentum). The authors found that low pH led T. caerulescens having higher concentrations of both zinc and cadmium in its shoots compared to ‘Rutgers’ tomato or bladder campion (“Phytoremediation Potential of Thlaspi caerulescens and Bladder Campion for Zinc – and Cadmium Contaimated Soil by S.L. Brown, R.L. Chaney, J.S. Angle, and A.J.M.Baker, 2005).
In cadmium contaminated soil, one approach to remediation is to plant metallophytes (plants that uptake metals like cadmium) in soils of lower pH, according to the above ASNS study these plants uptake greater amounts of metal in pH around 5.06. Organic acids are the best way to bring down pH – newly added organic materials to a compost pile brings down pH – and a study would have to be conducted on the metallophytes to determine their acidity and nitrogen tolerance.
Another strategy in cadmium rice consumption was observed in the presence of zinc, iron, and calcium.
The retention of cadmium was 10 times greater in rats with zinc, iron, and calcium deficiency, according to a U.S. Department of Agriculture, ARS, Kasetsart University in Bangkok, and Department of Pathology, University of Western Ontario, London, Canada. The authors of this study reported that deficiencies of iron, zinc, and calcium are common in rice-based diets, and increased the risk of cadmium in diet from eating contaminated rice (“Containing High-Cadmium Rice or Sunflower Kernels and a Marginal Supply of Zinc, Iron, and Calcium” by Philip G. Reeves, Rufus L. Chaney, Robert W. Simmons, and M. George Cherian, 2004). If known consumption of cadmium rice has occurred, then to help reduce risk of heavy metal retention in the body, consuming foods rich in iron, calcium, and zinc help reduce retention.
Other studies on cadmium affect on rice include inhibited catalase activity (which helps plants metabolize antioxidants), increased superoxides, and there are attempts to genetically modify rice to not uptake cadmium.
In 2010, China saw 21 percent year over year growth industrial production compared to 12 percent year over year GDP growth that same year. In 2014, year over year industrial production was 7 percent, about a percentage lower than GDP growth. Cadmium rice is a sign of economic waste that holds commodity recovery opportunity and healthier soils.
When Roth was asked how cadmium may be used for productive purposes is one of respect: “Anyway cadmium has many other industrial uses which I’m not fully familiar with and like anything else must be used in a respected and common sense way.”