For the Quarter Ending December 2022
North America
This quarter, R-PET prices in North American markets consistently decreased. The moderate demand for this product from businesses downstream contributed to the price drop in the United States. Because they were able to negotiate better prices for virgin PET than for R-PET, some businesses preferred it over this product. As a result, businesses that recycle PET did not increase their production rates because there were sufficient stocks of the product to meet demand. The subpar performance of the upstream crude oil market was another factor that contributed to the cost reduction.
APAC
This quarter, the market sentiment for recycled polyethylene terephthalate was the same across the entire Asia-Pacific region. Due to the implementation of Covid - 19 curbs, which hampered production activities, China's R-PET market was moderate. As a result, beverages and other downstream businesses gave typical procurement orders for the purposes of production. The commodity's price was significantly impacted by the subpar upstream crude oil performance. The R-PET market in India was not very impressive because FMCG, plastics, and packaging companies had a lesser interest in this product. As a result, more of it remained in inventories without being sold, forcing suppliers to lower their quotes to increase sales.
Europe
In this quarter, the markets for recycled polyethylene terephthalate in Europe and Asia were identical. The beverage, plastics, and food industries were more concerned about rising energy costs as a result of the ongoing conflict between Russia and Ukraine, which did cause them to reduce their production rates significantly. As a result, the market was heavily based on the demand for this product. The price of this product was also affected by the events that were going on in the upstream crude oil market. As a result, the ample stocks in stores and inventories were meeting the requirements of downstream businesses.
For the Quarter Ending September 2022
North America
The cost of R-PET remained idle for more than a month in the North American region this quarter. The consistency in cost was because of the stability in the demand-supply ratio of this product, and companies involved in recycling PET did not enhance their production rates as enough volumes of this product were available in inventories. However, in the final month of this quarter, the cost of this product stepped down as companies preferred virgin PET over this product, and plastics recycling companies were closed owing to summer vacations. Hence, in the U.S., this product concluded its market this quarter at USD 2,370 per MT (for food-grade pellets) on FOB – Los Angeles basis.
APAC
Recycled – Polyethylene Terephthalate was experiencing mixed market sentiments in the Asia – Pacific region this quarter. In India, the R-PET market was dull in the month of July; however, it bounced back in August owing to the concerns that arose over the ban on single-use plastics by the Indian government. The other factor which contributed to cost growth was the expanded demand for this product from food and beverage companies for packaging purposes. Yet, in September, the cost fell as companies had procured more of this product in the previous month. When it comes to China, the R-PET market witnessed growth till the fourth week of August, as beverage companies came up with more orders to fulfill the summer demand for their end–products. However, the market went down in September because of the modest interest for this product shown by downstream companies, and so, R-PET closed its market in China this quarter at USD 1,059 per MT on (spot) ex – Shenzhen basis.
Europe
The European market of Recycled Polyethylene Terephthalate saw ups and downs this quarter. This product started trading in this quarter with growth in cost; however, it stepped down and remained stable for a while in August and came down further in September. Again, the market grew and stayed idle in the last couple of weeks this quarter. The market was hugely based on the demand that this product was receiving from beverages, plastics, and food companies, as they were concerned more about the soaring energy costs and uncertainties in power supply, which did and could hamper their production activities to a great extent. The events that were taking place in the upstream crude oil market also had an impact on the cost of this product. As of 30th September, R-PET cost stood at USD 2,002 per MT on FD – Hamburg basis.
The price of R-PET witnessed an uptrend in the North American Region during the second quarter of 2022. The active inquiries from end-user industries such as food and beverage, automotive, and other vital sectors to incorporate recycled plastics into their products have supported the augmented price trend of R-PET in the domestic market. Constraint feedstock supply and high energy costs caused the recycled plastics market to remain stronger. In the second half of Q2, the market competitiveness due to reduced virgin PET prices and a sharp drop in plastic exports has pressured the price discussions of R-PET. Furthermore, the ban imposed by China and Turkey on plastic imports has also dwindled the plastic scrap supplies in the USA. However, the prices remained firm for RPET Pellets Clear Flakes and RPET Pellets Food Grade Pellets in the USA and were assessed at USD 2160/MT and USD 2645/MT FOB Los Angeles during June.
During the second quarter of 2022, the price of R-PET demonstrated mixed sentiments in the Asia-Pacific Region. The resurgence of COVID cases in China has taken a toll on the economy and hampered trade activities. As a result, a continual plunge was observed amidst stockpiling of products and deteriorating buyer sentiments. Industrial production faced pressure from insufficient market demand and continued to battle shipping delays as ports in China remained clogged up. In India, R-PET prices were observed to be on a bullish run throughout Q2 amid robust demand from the downstream packaging sector. The worsening ties between Russia and Ukraine and the stringent COVID restrictions on China have severely disturbed the market equilibrium. The constrained supply of post-consumer bales coupled with elevated crude oil prices and freight charges has supported the uplifted price discussions of R-PET in the domestic Indian market. In June, the recycled polyethylene terephthalate (R-PET) prices in China observed for R-PET Flakes were USD 1050/MT on a FOB basis.
The constrained supply of post-consumer bales and elevated crude oil prices have imparted substantial cost pressure on R-PET prices in the European region. The supply turmoil unleashed by Russia's invasion of Ukraine has prompted upward pressure on the key energy raw materials, driving manufacturing costs higher. Also, the robust demand for recycled plastics from the automotive industry and an increase in e-commerce have all contributed to a positive market outlook. The market participants have emphasized using recycled plastics for sustainable development, inflicting R-PET's price discussions to soar further in the regional market. The strong buying sentiments provoked the high price levels of R-PET in Germany, which settled for R-PET Food Grade USD 2568/MT FD Hamburg.
