Climbing prices

Pricing for some grades of secondary plastics were rising along with the temperatures in many parts of the country from mid-June to mid-July.

A reprocessor of postindustrial plastic scrap serving the eastern U.S. and parts of Canada says pricing is firming for many recycled plastics.

He characterizes domestic demand as strong in light of limited prime supply for many resins.

“Producers have more orders to fill, and recyclers do not have backstock to sell, so slack is coming out of the market and pricing is firming,” the reprocessor adds.

A material recovery facility (MRF) operator in the Midwest and a recycled plastics broker in New York both mention the price gains seen in recycled HDPE (high-density polyethylene) recently, which they attribute to rising milk prices that are leading to decreasing consumption and postconsumer generation.

“There has been less clear/natural HDPE available, and it has rocketed in pricing,” the broker says, noting that prices have ranged from 55 to 59 cents per pound recently. This is up from 49 cents per pound in mid-June, the MRF operator says.

Pricing for recycled PET (polyethylene terephthalate) has been moving in the opposite direction, however, in light of a glut of material on the market, the broker says. “It is starting to balance out, and we should hopefully see an increase in PET pricing in the coming months.”

The reprocessor says recycled PE (polyethylene) and PP (polypropylene) are strong domestically, which he attributes to high prime pricing, limited prime availability and demand growth.

In mid-June, the MRF operator characterized export demand as “very soft,” adding, “Inventories of finished product in China are extremely high right now. Some buyers that we have spoken with have actually shut down their processing operations.”
 

However, as of mid-July, Chinese consumers regained interest, with the New York-based broker saying he has been receiving more inquiries.

When it comes to moving material by truck, produce season continues to have an impact. The broker says trucks only want to travel into Georgia and Florida because of the higher pricing in those lanes.

“This affects our bottom line; but, if you have a good freight broker, they can help you weather the storm without losing too much profit,” the broker adds.