Standard recyclate demand remained well below normal levels at the beginning of the new year, even though converters started to replenish their stocks. Recyclers also had plenty of stock in their warehouses, meaning that implementation of price increases to improve margin at a time of low demand, was unlikely. Furthermore, recyclers faced growing competition from the falling cost of standard material. In addition, cheaper alternatives such as off-spec material or even imports of virgin material falsely relabelled as recyclate, continued to enter the market and distort competition.
In February, there is a notable improvement in demand as converters start to replenish stocks, although order activity remains lower than would normally be expected. Recyclers are slowly beginning to loosen their grip on production levels as demand shows signs of a muted recovery. Overall, the price trend is pointing slightly upward this month.
R-PET prices have seen the largest price increases; R-PET prices increased by €15-20/tonne in January and have risen by a further €20-30/tonne this month, largely in response to higher input costs.
R-HDPE, R-LDPE, R-PP and R-HIPS prices were mostly unchanged in January due to weak demand.
R-HDPE prices remain stable this month and there has been a small uptick in R-LDPE translucent film pellet prices. R-LDPE natural film prices are up by €30/tonne, R-LDPE natural film prices have benefitted from the supply tightness of virgin LDPE and substitution by recyclate. R-PP and R-HIPS prices have risen by €10/tonne this month.
Standard recyclate prices are likely to continue on an upward trajectory over the coming months as a result of an expected seasonal upturn in demand.
Polyethylene terephthalate (R-PET)
In January, R-PET recyclers passed through the higher cost of bottle scrap with price increases of €15-20/tonne. While overall demand remained disappointingly low, there was a pickup in volume calls as many converters started to rebuild their inventories. Recyclers had more than enough stock in their warehouses to meet demand.
R-PET producers are pushing through more sizeable price increases in February because of better demand and higher input costs. R-PET coloured flake and clear flake prices are rising by €30/tonne with clear food-grade pellet prices rising by €20/tonne. Volume calls continue to recover as converters top up their inventories.
Recycled high-density polyethylene (R-HDPE)
At the start of the New Year, recyclers came under pressure from buyers to reduce prices, but most sellers held out for a price rollover. While volume calls remained low, there was a notable upturn in demand as converters began to rebuild stocks. Strict production controls by recyclers held supply at a low level.
R-HDPE prices are moving in an upward direction in February with gains of around €10/tonne. There is a small upturn in demand this month as converters continue to top up their inventories. Plant operating rates are being adjusted upwards slightly in response to the improved demand picture.
Recycled low-density polyethylene (R-LDPE)
Recyclers attempted to raise prices at the start of the New Year but eventually had to settle for a rollover because of low demand and competition from virgin material. Initial restocking activities by converters led to a modest demand stimuli, but underlying demand remained low. Input material costs were rising which led recyclers to keep plant operating rates to a minimum.
In February, R-LDPE natural film grade prices are rising by €25-30/tonne, translucent film pellet prices are increasing by €10/tonne with black extrusion material prices unchanged from the previous month. Standard LDPE supply shortages have led to some substitution by R-LDPE natural film. Volume calls are much stronger this month but still below normal levels. Some recyclers are raising plant operating rates in response to the stronger demand.
Recycled polypropylene (R-PP)
R-PP prices were largely unchanged in January despite attempts by converters to seek concessions. Demand remained weak, although there was some stock rebuilding taking place. There was more than enough material available to meet demand.
In February, R-PP homopolymer black prices are largely rolling over from the previous month while copolymer black is edging up by €5-10/tonne at the top end of the price range. Demand remains much too subdued to enforce higher price premiums. Plant operating rates were maintained at a reduced rate.
Recycled high-impact polystyrene (R-HIPS)
R-HIPS prices once again remained unchanged at the beginning of the New Year, as demand remained very low. Recyclers had sufficient material despite low plant operating rates and some plants only returning to work during the second week of January.
In February, recyclers are raising prices by €10/tonne as converters began to replenish stock levels. R-HIPS producers are maintaining plant run rates at a low level.