Robust Downstream Demand Strengthens German Recycled Plastics Market Sentiments
- 21-Jun-2022 4:32 PM
- Journalist: Harold Finch
Frankfurt, Germany: The inclination toward a sustainable environment and rising awareness about plastic waste with strict government regulations have propelled the market sentiments toward recycled plastics in the European market. The growing use of recycled plastics in the automotive industry and an increase in e-commerce have all contributed to a positive market outlook and uplifted their market value.
In Germany, the prices of recycled Polyethylene Terephthalate (R-PET) and recycled Polypropylene (R-PP) have risen approximately by 2% and 3.4% from last month, respectively, owing to increased demand from the bottling and packaging sector. As per the market scenario, recyclers across the country face obstacles in securing enough supplies of plastic waste. In addition, it also strengthened the price dynamics of scrap bale feedstock. As a result, the nation encountered strong supply-side concerns for the feedstocks and a reduced plastic recycling rate, which has significantly influenced the country’s development toward a circular economy.
Furthermore, the tightened gas supply from Russia due to technical dysfunctions has compelled the gas price to increase by double digits. Thus, the high input costs due to supply disruptions amidst the conflict between Russia and Ukraine and the global challenges from the COVID-19 pandemic functioned as a catalyst and put equivalent inflationary pressure on recycled plastics manufacturing. The analysis depicts that the evaluated price for R-PP-Natural Pellets FD was USD 2400 per tonne this week. Likewise, the R-PET Flakes FD Germany prices were observed as USD 2145 per tonne, concluding in the third week of June 2022.
According to ChemAnalyst, the bullish demand from the downstream packaging sector would cause a significant rise in the price discussions for recycled plastics in the German market. In addition, the diminished energy supply to the European nation is also likely to severely impact the cumalative manufacturing costs for recycled plastics. It will ultimately boost the market sentiments toward recycled plastics in the forthcoming weeks.