September 2020

The effects of COVID have been widespread in the USA, with many recycling and collection systems shutting down or reducing operating hours. The impact was positive on commodity prices for a short period of time but these soon fell again once businesses reopened and summer volumes increased.

At the peak of the COVID-19 crisis, the rPET bale price climbed to US$ 0.20 per lb - in stark contrast to virgin PET, which remains low. As the volumes of rPET began to increase, the PET bale price dropped around 50% to US$ 0.095 per lb. Currently, PET prices remain flat owing to high summer volumes and low demand, chiefly caused by packaging and beverage container manufacturers opting to buy cheaper virgin resin and cut back on their use of rPET. However, there is greater demand for rPET bottle-grade pellet, resulting in a difference in regional and end-use pricing. The start of 2021 may see an increase in rPET values as a result of two factors: first, the recent hurricanes in the south east of the USA which have caused the shutdown of several virgin resin manufacturers, thus reducing production; and second, approval of legislation in California mandating recycled content in bottles.

PP has seen some encouraging growth in the USA, with greater investment in sorting and end markets. This year, a national PP coalition managed by the Recycling Partnership is conducting research and providing grants to MRFs to increase collection. In California, and probably typical of other areas, only 25% of MRFs are actually pulling and creating PP bales. More collection is needed if markets are to grow. Tubs & Lids bales (which are predominantly PP) are particularly sought after, having competitive buyers both domestically and in South East Asia. The same can be said of HDPE Injection Bulky Rigids bales, comprising buckets and crates, that have stable end markets. For PP as with most plastics, the greater the level of sorting, the greater the value; mixed bales have little value and, despite some domestic market growth, more PP collection is needed.

Demand for recycled HDPE clear pellet remains competitive, with prices in the low to high US$ 0.50 per lb range. Production of virgin resin is failing to meet demand and so end users are turning to post-consumer resin (PCR) to fulfil their needs. There is some demand, specifically from a few brands that require PCR in their packages.

LDPE is experiencing mixed fortunes: clear, clean shrink-wrap - mainly from commercial accounts - is in high demand, especially as it compares to dirtier kerbside material which has no viable market; meanwhile, mixed film bales are attracting some buyers but are very low in value.

Few buyers are to be found for solid PS whereas foam PS, if sorted and clean, has value both domestically and for export. The same cannot be said for mixed solid/foam PS bales, for which the market is flat unless separated and in significant volume.

Overall, COVID-19 has impacted the post-consumer market in multiple ways, primarily by highlighting the weakness of several commodity markets and the need for greater modernization and investment. On a positive note, this has led to some new initiatives and greater national discussion of the recycling industry that has promoted commitments from brands and investments in new facilities. However, the combination of cheap and plentiful virgin supply, struggling recycling centres and COVID complications has made for a difficult year.

Sally Houghton - Sally Houghton (United States)

Sally Houghton

The Plastic Recycling Corporation of California (USA), Board Member of the BIR Plastics Committee

United States
September 2020