Investing in processing capacity

A number of companies have announced capacity additions for 2020 and beyond that will help to provide homes for some of the plastic grades most affected by China’s import ban on postconsumer plastics, namely plastic film and mixed plastics. Others have announced investments in chemical recycling designed to address difficult-to-recycle plastics.

In April, Eastman, Kingsport, Tennessee, announced its development of “carbon renewal technology,” a chemical recycling process that can recycle some of the most complex end-of-life plastics. In November, the company announced that it will use this technology to recycle postconsumer carpet through a partnership with Circular Polymers, which has a plant in Lincoln, California.

Circular Polymers will densify the fiber for shipment by rail to Eastman’s Kingsport site, where it will be converted into molecular components for use in textiles, cosmetics, personal care and ophthalmic products.

“Demand for recycled plastics is softer in some areas because we are losing business to people who are price buyers.” – a contact at a global reprocessor

In the area of mechanical recycling, a number of companies have announced capacity additions, including Avangard Innovative, Houston. During the 2019 Paper & Plastics Recycling Conference (PPRC) in October, Marcus San Juan, the company’s regional sales manager, said Avangard’s plans include moving its Houston plant to Waller, Texas, and increasing processing capacity to 100 million pounds per year. It also will open a plant in Mexico in mid-2020 and a facility in Nevada, which will supply the California market.

Avangard and other reprocessors of plastic film, including Canada-based EFS Plastics and PreZero, the San Diego-based recycling arm of German retailer Schwarz Group, see opportunity in states that have passed recycled-content regulations. California will require reusable grocery bags sold in the state to be made of 40 percent recycled material in 2020, an increase from the current mandate of 20 percent.

PreZero has plans to add capacity to handle mixed plastics and plastic film at three locations in the U.S. Hendrik Dullinger, vice president of expansion and innovation at PreZero, told PPRC attendees that the first of those locations will process low-density polyethylene (LDPE) in Jurupa Valley, California. The second will be in partnership with ACI Plastics, a thermoplastics processor and recycler headquartered in Flint, Michigan, and involves investing $10 million to expand ACI’s operations in Westminster, South Carolina.

“The expansion will help us to provide solutions for a problematic category of mixed rigid plastics,” ACI President Scott Melton says in a news release announcing the investment. “We are installing state-of-the-art equipment capable of recovering 80 million pounds of plastics that were historically shipped overseas.”

A contact at a reprocessor that operates globally says manufacturers that buy to meet their recycled-content commitments are “more elastic” in terms of the price they will pay for this material but also demand higher quality.

“Demand for recycled plastics is softer in some areas because we are losing business to people who are price buyers,” he says, noting the current low pricing for virgin and off-spec polyolefins.