• PT Youtube
  • PT Facebook
  • PT Linkedin
  • PT Twitter
8/19/2016 | 2 MINUTE READ

Recycled Resin Market Still Volatile

Facebook Share Icon LinkedIn Share Icon Twitter Share Icon Share by EMail icon Print Icon

At midyear, recycled resin prices presented a mixed picture, though industry sources see a period of soft prices ahead.

Recycled resin prices went up and down in the first half of the year; a lot of the movement based on oil prices and virgin resin gluts in the market, industry sources say. At the end of June, an industry analyst summed it up: “Oil prices have become the benchmark that people look to for resin, even though we make most of the resin in the U.S. out of natural gas. Also, there is uneasiness in the markets with Britain’s move to pull out of the European Union. I expect it will be uncertain for the next couple of months, not because anyone knows what it means to them, it’s just a change.”


Recycled PET prices have gone up a bit since the beginning of the year, but demand continues to be soft and uncertain. “It’s the worst situation I have ever been in relative to the amount of time the volatility has lasted, and I expect that will continue for some time,” noted one recycler. “The people that live off of municipal recycling need a floor on commodity pricing to keep solvent.”

With ample virgin material available, as long as oil prices stay low, many former users of post-consumer resin will use more virgin, one analyst predicted. “The bloom is off the rose for post-consumer content if buyers are basing purchases solely on price. If you don’t really need it as part of a mandate, or you are not using it for something specific, then you may buy virgin materials which are very competitive.”

Recycled HDPE demand started to slow down by the fourth week in May, according to recyclers. That slowdown had to do with a cold, wet spring. The pipe market was particularly affected, but traditionally the second half of July is strong, and recyclers expected the same for this year.

Even though the virgin resin market surged in May and June, there was still a lot of wide-spec in the market to compete with recycled product, buyers said. “We exited the natural market for a while because the scrap was so expensive and not in line with what virgin pricing was doing, but that is starting to level off,” once recycler said. Natural post-consumer product rose by as much as 14¢/lb in some markets since early this year.

Recycled PP prices fell in June by half a cent/lb. Even though demand was “OK,” said one reclaimer, “A lot resin is being imported from Asia, which up to now has mainly affected the West Coast. However, now that the Panama Canal has been widened, big ships started coming through in July. I think a lot of the same issues that California sees will now be seen in New York, Miami, and other port cities.”