US r-PET market continues to Soar Virgin PET also makes a price jump
US r-PET market continues to Soar Virgin PET also makes a price jump

US r-PET market continues to Soar Virgin PET also makes a price jump

  • 13-Dec-2021 5:03 PM
  • Journalist: Patricia Jose Perez

Early December assessments show a strong volatility in the PET (Polyethylene terephthalate) market where both recycled and virgin material were termed stronger from their November price discussions. Virgin PET have increased to USD 1845 per MT DDP while r-PET (recycled Polyethylene Terephthalate) clear flake prices have increased from USD 1740 to USD 1810 in the first week of December on FOB basis.

Plastic resins market has been resurgent since the slump of 2020 where prices deteriorated substantially. In lieu of that, 2021 brought much needed impetus to the polymer market where demand recovered sharply, consequently improving margins for the manufacturers in a production-deficit market .

Rising inclination towards circular economy and green development in the West has pushed for recycling. Consequently, r-PET prices have been bullish for a major part of the year consolidating on strong demand from downstream recyclate industrial yarn sector, which is the largest consumption sector for r-PET. Another critical factor at play has been the stagnancy in production rates which has been caused by structural issues in the US economy. Stagnation in production has stemmed from low recycling rates across the country which have emanated from ineffective Municipal Recovery Systems (MRFs). While MRFs are remarkable when it comes to paper, glass, or metals recovery, however MRFs’ efficiency for plastics reclamation, specifically for PET, drops down significantly. As per several reports, mere 6%. of the total off-take weight processed by MRFSs forms the plastic volumes. Surprisingly, 20% of the revenues from off-take sells are derived from plastics, particularly PET bottles.

In 2019, USA consumed more than 4.4 million metric tons of r-PET, of which close to 900,000 metric tons was recycled. This places US recycling rate in and around 30%. Having 1/3rd of the material back into system is moderate however given the extent of US economy and pertinent innovations in recycling technologies, US can improve on its recycling rates which will increase production and therefore availability of r-PET in the market.

Recently, Alpek acquired CarbonLite Recycling LLC’ state of the art recycling and pelletization facility in Reading, Pennsylvania in US which has 115 KTPA of bottle-to-flake capacity and 49 KTPA of flake-to-pellet capacity, making it the largest integrated rPET facility in the Americas. This is likely to push the recycling rates northwards while increasing production of r-PET in the market thus stabilizing prices of the available material.

Meanwhile, Virgin PET prices continue to strengthen on the back of strong demand from downstream sectors and inadequate availability of feedstock PTA (Purified Terephthalic Acid). USA has domestic production of PTA; however, the country depends heavily on PTA imports from Mexico. Unforeseen weather conditions which disrupted global supply chain throughout the year has curtailed availability of imported PTA and thus shortening the production of PET.

Related News

LG Chem and Acies Bio Partner to Drive Sustainable Chemical Production
  • 06-Dec-2024 10:45 PM
  • Journalist: S. Jayavikraman
Suez Loop and SK Geo Centric Scrap Plans for PET Chemical Recycling Plant
  • 29-Nov-2024 7:45 PM
  • Journalist: Lucy Terry
Cyclyx Plans to Invest in Second Cyclyx Circularity Center
  • 28-Nov-2024 1:30 AM
  • Journalist: Phoebe Cary
R PET Market in the US Maintains Stability in Prices in November 2024
  • 27-Nov-2024 8:00 PM
  • Journalist: Patricia Jose Perez