Highs and Lows

Secondary plastics markets are varying greatly by grade as summer comes to a close, with some posting considerable losses in terms of pricing and others making considerable gains. Export markets for some secondary plastics seem especially weak as well.

Export pricing for polyethylene films, in particular, has declined by nearly 50 percent in the last quarter, according to a reprocessor based in the Midwest.

The export market for PET (polyethylene terephthalate) also has been soft since March, though a reprocessor based in the South says PET prices saw an increase in August. He describes the export market for PET as “stagnant since March,” adding that May and June were particularly bad.

The reprocessor based in the Midwest says orders for PET from China can either spike or dip in the summertime, depending on production of polyester fiber. This summer has seen exports of recovered PET decline.

According to reports, cotton inventories worldwide are plentiful, as are Chinese inventories of the material, which has created pricing parity between cotton and synthetic fibers such as polyester, making synthetics less attractive. Additional declines in cotton pricing could lessen demand for synthetic fibers, according to National Australia Bank agribusiness economist Michael Creed in an interview with BlackSeaGrain.com.

Polypropylene (PP) also has experienced declining demand and price, falling 25 to 30 percent in value from April to July, the reprocessor based in the South says. He reports that pricing has started to pick up, however, as of early August.

Recycled polystyrene (PS) has received a boost as of late. The material is in demand in light of production woes in the virgin sector.

In early August, Styrolution, a primary supplier of styrene monomers, polystyrene and copolymers and acrylonitrile butadiene styrene, declared force majeure on its North American styrene business for that month after it had to shut down its 455,000-metric-ton-per-year styrene plant in Canada at the end of July because of a crack in a heat exchanger. The plant will remain down until the end of October for a scheduled turnaround, as reported by ICIS, a petrochemical market information provider.

The reprocessor based in the South says recycled PS pricing increased by 10 cents per pound in August in response to price increases for virgin material.

Industrial generation continues to be slow, as expected in the summer months, though it is beginning to increase as of mid-August, sources say.

The reprocessor based in the South says he suspects some material recovery facilities (MRFs) may be sitting on inventory when it comes to PET and other post-consumer material, awaiting better pricing.

Domestic demand for recycled plastics is generally characterized as healthy. “If I had more material to sell, I could sell it,” the reprocessor based in the South says.

(Additional information about secondary plastics, including breaking news and consuming industry reports, is available at www.RecyclingToday.com.)