‘Plummeting’ virgin PET price threatens recycling

Posted by aclimaadmin | octubre 15, 2019 | Noticias del Sector

European recycled polyethylene terephthalate (rPET) will be the same price or more costly than virgin PET price next year, market data firm S&P Global Platts Analytics has warned, raising questions over whether plastic waste can be curbed.

It found that virgin PET prices had “plummeted”, with the material being currently cheaper than rPET for the first time since 2008.

The company forecast that the total cost of rPET content in UK packaging in 2020 would increase by $250m (£199m) relative to 2018.

Its research report said that, during 2018, the average price of European virgin PET was $1,464/tonne while the average price of rPET was only $1,205/tonne.

This had provided an average $259/tonne benefit for using rPET in place of virgin material resin last year.

But price changes this year have seen rPET prices rise to an average $72/tonne above the virgin price.

S&P Global Platts said a combination of new virgin PET capacity coming online, high stocks, bearish feedstock prices and a delayed start to the summer season this year saw demand for virgin PET resin decrease so driving down prices, while rPET prices proved more resilient.

It said that in the past five years, rPET had enjoyed an advantage over virgin PET that averaged $220/tonne, but since the beginning of this year virgin PET prices had plummeted while rPET prices remained largely stable.

This has meant that for the first time since S&P Global Platts began to assess rPET 11 years ago, it has become more expensive than virgin PET material prices.

Despite the economic incentive to use virgin materials, larger companies that had made public commitments to using 25% rPET content were expected to continue with this since the financial cost were “likely to be outweighed by growing sustainability commitments”, the analysis said.

But smaller companies would be likely to switch away from expensive rPET and instead use the cheaper virgin material.

S&P Global Platts said that, to balance rPET supply and demand, “the recycling industry needs to expand processing capacity to meet the growing demand for food-grade rPET.

“Recycled PET prices need to provide the economic incentives to balance the limited food-grade rPET supply with the increasing demand and also provide a return on the required recycling expansions.

“Both of these market actions require higher rPET prices relative to virgin PET in the near term.”

In the meantime, the sharp price difference would “make increasing the rPET content in bottles much more expensive and will challenge the green consumers’ willingness to pay a premium for recycled content”.

Fuente: mrw

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