Revving Up

Secondary plastics markets seem to have received the memo that summer officially has come to an end, and activity has picked up somewhat as a result.

According to a reprocessor of postindustrial material, generation is steady to increasing as of mid-September. The reprocessor, based in the East, adds, “Plant shutdowns in July and early August made supply slightly inconsistent.”

Domestic demand also has picked up, leaving the lazier pace of the summer behind. “Domestic demand is coming out of the summer doldrums, with slight improvement recognized in September,” a material recovery facility (MRF) operator based in the Midwest adds.

The reprocessor describes demand as “strong,” particularly from the building/construction, lawn and garden and dunnage sectors. He adds that pricing for secondary plastics is “stable to rising.”

A reprocessor based in the Southeast adds that demand from the automotive sector is strong in her region.

Polypropylene (PP), polyethylene (PE) and rigid PVC (polyvinyl chloride) are all experiencing strong demand currently, the reprocessor based in the East says, adding that it’s more than a seasonal increase. “It feels like spring of 2004, which was very strong and continued through 2007,” he says.

The reprocessor based in the Southeast also says that pricing and demand for PP are increasing, though she is unsure at the time what to attribute the increases to.

“Low-end ‘export’ grades are still being hurt by [Operation] Green Fence and the India situation,” the reprocessor based in the East adds, referring to China’s initiative to crack down on existing regulations regarding waste imports and to the devaluation of the Indian rupee.

He adds that low-end grades and combination loads are still difficult to ship successfully into China. “Full containers of clean, graded material are flowing well with solid pricing,” he says.

Regarding India, the East-based reprocessor says high grades are moving at reduced pricing, while sales of low grades have come to a halt.

The MRF operator also notes an improvement in export markets, particularly in regard to China. “Export markets are improving, with several grades affected by China’s Green Fence starting to move, including woven PP Super Sacks, mixed rigid containers, mixed engineering grades and low-quality film grades.”

The MRF operator says mixed loads of plastics Nos. 3 through 7 remain difficult to move on the export market, adding that China, Vietnam and Indonesia are popular destinations for his firm.

“There is still robust supply available, which is likely to keep pricing suppressed until next year,” the MRF operator adds.

Transportation is not currently an issue, according to sources, with the MRF operator saying, “Rail and export containers are readily available.”

The Southeast-based reprocessor adds, “The end of produce season has helped decrease our overall expenses in the area of transportation.”

However, the reprocessor in the East says freight costs have increased 3.9 percent this year for his company.