Plastics

While China’s appetite for secondary PET remains voracious, events in the country are contributing to a recent decline in pricing for the material.

"The China market is really tough right now," a source on the West Coast says. According to the source, although China’s demand for PET is high, a crackdown on imports and wash/grind facilities is helping to drive pricing for the material downward. "Rumor has it that there was a big shipment of garbage from Europe to a town in China," he says. "It created a big stir."

That town, Lianjiao in the province of Guangdong, serves as the center for plastics processing in China. According to a Bloomberg report, Lianjiao processes nearly 200,000 tons of plastic "garbage" yearly, 80 percent of which is generated domestically. According to China’s State Environmental Protection Administration (SEPA), the remaining material is likely imported illegally.

"The illegally operated businesses that processed waste plastic near the village of Lianjiao have been ordered to move, and the remaining waste plastic has been cleared away," Chen Guangrong, deputy director of the Guangdong Provincial Environmental Protection Bureau, told the Xinhau News Agency in a report dated Jan. 31.

"All of the imported waste in the industrial zone [was] most probably coming from smuggling or other illegal channels, because none of the businesses in the zone which process imported waste plastic have received government approval," Chen said.

According to the Xinhau report, the local government had banned unlicensed businesses from importing plastic scrap into Lianjiao ealier.

The West Coast source says that a number of polyester fiber producers have positioned themselves near the wash/grind facilities in Lianjiao and are now struggling for clean flake. "Brokers are having trouble getting material into the country," he says. "We’re not really having trouble moving the material, but we have seen pricing come down a little as a result."

The decline in PET pricing follows on the heels of speculation leading up to Chinese New Year, which helped to nudge secondary plastics prices upward, particularly on the West Coast, according to the recycler.

The domestic market for HDPE remains healthy, according to sources. However, a recycler based in the Southeast says, "Pricing needs to come down to be competitive with virgin HDPE." She adds, "I thought it would [in January], but it didn’t."

The Southeast recycler continues, "The biggest thing keeping the market up is export—a new player. They are taking a lot of it." She adds, "What is left for the rest of us to fight over commands a higher price."

According to the West Coast recycler, some consuming facilities have been buying virgin HDPE pellets because they are less expensive than HDPE regrind. He adds, "The export market is keeping the price up. The domestic buyers are forced to pay higher prices."

(Additional news about plastics recycling markets is available online at www.RecyclingToday.com.)

Maine Plastics, Zion, Ill., has relocated to its new customized 222,250-square-foot headquarters and processing plant.

According to the company, the new facility provides its staff with an improved work environment and also increases its processing capacity to 95 million pounds annually. The facility features 24 docks, doubling the number Maine Plastics had at its North Chicago plant.

According to Maine Plastics’ David Kaplan, the company also added additional processing equipment, including new grinders and shredders, which has further helped the company to increase throughput.

Irish Polymers of Crumlin, Northern Ireland, has opened the first fully automatic sort facility for post-consumer plastic bottles in Northern Ireland. The new plant represents an investment of 1.5 million Euros.

Up until this point, plastic bottles collected throughout Ireland for recycling were baled and shipped off the island.

At the new 20,000-square-foot plant in Northern Ireland, post-consumer bottles are being automatically sorted into various polymer types using German technology.

Irish Polymers plans to process around 10,000 metric tons of mixed plastic bottles within the next year. This material will be collected from Northern Ireland and the Republic of Ireland, representing as much as 60 percent of what is collected totally on the island.

Demand for plastic film in the United States is expected to increase by 2.6 percent per year through 2010, according to a study from Cleveland-based market research firm the Freedonia Group.

Low density polyethylene will remain the largest plastic film resin based on its competitive cost structure, versatility and opportunities in areas such as produce and snack packaging, stretch and shrink wrap and trash bags. Slightly faster increases are expected for high density polyethylene film in light of good growth in areas such as baked goods packaging and retail bags.

According to the study, polypropylene film demand will expand the fastest with 3.4 percent annual growth through 2010, driven by produce, grain mill, dairy and other food packaging applications. The Freedonia study also predicts that polyester film demand will decline through 2010 as a result of decreasing use of the material in photographic film and magnetic tape.

Packaging accounted for 73 percent of all plastic film use in 2005, according to the study. The best growth is expected in secondary packaging applications based on opportunities in stretch and shrink wrap and retail bags. According to the Freedonia Group, food packaging will grow at an above average pace, driven by continued expansion in produce, confections and frozen food segments.

Nonpackaging fill advances will be fueled by trash bag growth and constrained by declining photographic film and magnetic tape applications.

According to the Freedonia study, research efforts will focus on improving film’s strength, barrier and graphic capabilities while maintaining a competitive cost position.

The full "Plastic Film" study is available for purchase through the Freedonia Group at www.freedoniagroup.com.