Plastics

Trex Co. Inc., based in Winchester, Va., has suspended operations at its Olive Branch, Miss., facility for an indeterminate amount of time and will consolidate all manufacturing operations into its other two plants, one in Winchester and the other in Fernley, Nev.

The company manufactures composite decking and railing products from reclaimed plastic scrap and wood.

Trex ceased production in Olive Branch in mid-September and will complete all other measures related to the suspension of operations in about 60 days. The company operated two production lines at the Olive Branch facility, which represented about 10 percent of the company's total manufacturing capacity.

Trex made the decision to suspend production after determining that a difficult housing market and remodeling sectors would continue to reduce demand. The company also says that recent upgrades of its production lines in Winchester and Fernley will provide the capability for increased quality and output.

In late August and early September, domestic and Chinese buyers were competing for LDPE (low density polyethylene) film, which Trex uses in the manufacturing of its products, driving up the price for the material. At that time, a recycler from the Midwest said he feared consumers of the material would try to rein in their expenses by scaling back their sourcing of material. Trex’s recent move, which the company says is in response to lackluster sales, will likely have that effect.

"If Trex announces a scale back, you’ll see LDPE film drop domestically," the Midwest recycler told Recycling Today in early September, before Trex announced the scaling back of its operations.

While the fortunes of LDPE film may stumble somewhat with Trex’s decision, other grades of secondary plastics appear to be faring better.

A reprocessor based in the Southeast says she has seen domestic demand for commodity grade plastics increase during the last few months. The growth in demand is accompanied by an increase in prices, in part because of increasing oil prices. "When gas prices go up, it seems [plastic] prices go up," she says. "It’s not a direct relationship, but it has helped."

She says her customers can’t get enough polyethylene. "It’s nice to have people calling me for a change." She also has seen good demand for polypropylene and polystyrene.

"I’ve had people want to commit to buying material to the end of the year," the Southeast reprocessor says.

She says such moves from consumers could be an effort to secure material at a lower price. "People anticipate prices holding steady or going up and are trying to hold the price down," she says. "We’re not going to let them do that. We’ll only go a month out."

When it comes to pricing and demand, she adds, "I don’t see a slow down right now. But things can change."

Generation in the Southeast has also been steady, the reprocessor says, noting that’s not typical. "Usually, this time of year, people are getting rid of inventory."

When it comes to consumer generation of plastics, an article in Chemical & Engineering News (C&EN) says the public is not doing enough to recycle their plastic beverage bottles and food containers to the detriment of U.S. plastics recyclers.

C&EN editor Alexander H. Tullo writes that Americans have deprived the plastics industry of material by failing to recycle more than 25 percent of the billions of pounds of plastic bottles and containers made in the United States.

The recyclers interviewed by Tullo eye Coca Cola’s entrance into PET bottle recycling with fear. "They say they already have trouble obtaining post-consumer plastic to run their facilities and they fear that Coke's entry into the market will make it difficult for them to earn a living." The C&EN article also points out, citing statistics from the American Chemistry Council, that almost 18 percent of the 162 million pounds of HDPE bottles recovered for recycling in 2005 were exported.

The full C&EN article is available at http://pubs.acs.org/cen/coverstory/85/8542cover.html.  

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