|RECYCLED RESIN PRICES|
|PET Bottles (Clean)|
Recycled resin prices kept rising in the first quarter, even while overall domestic demand was slowing. Strong exports were a key culprit. Will that continue through the next quarter? For most resins, the answer looks to be yes. LL/LDPE might be the exception, though.
Recycled HDPE prices have risen about 3¢/lb since November. Demand was soft during the last quarter of 2007 and into January, but some reprocessors saw an uptick in demand by early February. Part of that increase was for seasonal production of flower pots. “At this time of year we usually see recycled resin prices go down, but this year they’ve gone up,” said one source. “Domestic demand is weak, but the export market is sucking up virgin material.”
Recycled LDPE and LLDPE saw substantial hikes in the past month—as much as 15¢/lb for mixed-color LLDPE. High oil prices raised demand for North American resin, which is made from natural gas, not oil. “North American PE prices are lower than in the rest of the world and the dollar is weaker as well,” said an industry analyst. But with soft U.S. demand, there’s plenty of virgin to export at reasonable prices, so regrind tends to stay at home, explains the analyst. “There seems to be a lot of regrind available. With no demand, U.S. recycle pricing may have maxed out.”
Recycled PET prices are up as much as 6¢/lb, supported by strong demand for post-consumer recycle in “sustainable” packaging. “We’ll see how people react when the differential between virgin and post-consumer material starts to close,” said one recycler. “We’ll see how serious they are about sustainable packaging then.”
China continues to buy a lot of R-PET. “If anything, they are buying more than ever,” one source explained.
Recycled PP and PS prices are creeping up. “I expect this for the foreseeable future,” said one broker. Scrap material is becoming more scarce. “More manufacturing is being done overseas. And processors here are using their own scrap more due to high virgin prices.”