The US metal recycling industry has found itself on the frontlines of China-US trade tensions, after China slapped retaliatory tariffs on US aluminum waste and scrap. The price of US scrap metal recycling has slumped due to the added tariffs. CGTN's Dan Williams went to a scrap metal company to find out the impacts of the trade dispute.

A truck load of smashed up cars arrives at a scrap yard. A claw picks up each one before effortlessly dispatching them into a trash compactor. Jeff Padnos is the chairman of Padnos, a company his grandfather set up in 1905. Today, it employs some 600 people across 18 locations throughout Michigan and Indiana. Last year, the company sent 4,000 containers of scrap to China by far its largest customer.

But then came the announcement in April that China had imposed retaliatory tariffs on U.S aluminum waste and scrap. By August, the tariff net widened to include ALL metal scrap commodities.

JEFF PADNOS PADNOS CHAIRMAN "We're kind of the innocent bystanders walking along here and then all of a sudden it's like a brick falling off the ledge here and hits on the head."

The U.S. recycling industry trade group reports that the United States exported a total of 5.6 billion dollars' worth of scrap commodities to China last year. Padnos believes the decision by the Trump administration to impose tariffs is a mistake.

JEFF PADNOS PADNOS CHAIRMAN "We were shocked to see some people in our government thinking that this is an easy thing and there won't be any retaliation. And we just said what are you thinking about, you are going to do something like that and there won't be a response."

With the added tariffs, the price of U.S. scrap metal recycling has slumped. It means auto suppliers and manufacturers that recycle excess metals are also being hit by lower scrap prices when they attempt to recycle the byproduct. With metal prices increasing because of tariffs, that is a further blow to steel and aluminum-using manufactures.

DAN WILLIAMS HOLLAND, MICHIGAN "Padnos remains hopeful that a solution to the trade dispute can be found and business can return to normal. If not, they fear long-term consequences to the trade."

JEFF PADNOS PADNOS CHAIRMAN "If our customers lose, it is like us losing. Because you won't have that business again. And that is what happened. People talk about a term, win-win and sometimes lose-lose. I think we have the potential to create a lose-lose situation."

That view is echoed by Jeffrey Bergstrand of the Mendoza College of Business at the nearby University of Notre Dame.

JEFFREY BERGSTRAND MENDOZA COLLEGE OF BUSINESS, UNIV. OF NOTRE DAME "It is going to price us out of the market. And that is going to tend to hurt the Michigan economy in terms of numbers of jobs. I think that is going to be the biggest impact."

The scrap trade between the U.S and China was a lucrative business. That, for now at least, lies in tatters. Dan Williams, CGTN Holland, Michigan.