Shrinking back slightly

Pricing for recycled natural HDPE (high-density polyethylene) pellets and flakes has been climbing over the last few months, with one broker/reprocessor based in the Southwest saying recycled HDPE had gained 20 percent in price since the start of the year as of late July. However, as of the start of August, HDPE saw a slight softening. Prior to that, the material had been enjoying a premium ranging from 5 to 10 percent relative to virgin material, according to the broker/processor.

“Demand for HDPE natural had been heating up going into the summer, along with PET (polyethylene terephthalate),” a broker based in New York City says as of late July.

HDPE mixed color (MC) pricing, however, has lacked the strength of its natural counterpart for some time, according to sources. The broker based in the Northeast says, “HDPE MC prices have slumped.”

In late July, the broker predicted natural HDPE would hit a ceiling by the middle/late summer, and that seems to have been the case as of early August. A broker/reprocessor with operations in the U.S. and Mexico says prices for commonly recycled plastics were decreasing across the board as of late July and early August.

Overseas markets for recovered plastics are still considered poor. “The Chinese market creates a challenging environment for MRPs (mixed rigid plastics) and 1-7s,” the broker based in the Northeast says. “A lot of material is being held up at the port for quality concerns.”
 

He adds, “We are staying away from the export market on most grades unless they absolutely can’t be recycled at a fair price domestically.”

Domestic buyers were still buying as of late July. “The big buyers are coming into the market to take in as much material as they can find, as long as it is for market price,” the broker based in the Northeast says of HDPE and PET.

Produce season continues to affect transportation rates and availability across the U.S., sources say. The broker based in the Northeast says, “Produce season started in May, and it ends around early September. This translates into lower rates if you are going from the north to the south because drivers want to take advantage of the increased demand in the southern U.S. If you are going from the south to the north, you are going to be killed with price because there is so much demand to get the perishable goods out of the south as fast as possible,” he adds.