R-PET buyers switch to virgin PET as price gap widens

In April, recycled polymer prices have continued to rise, but to a much smaller extent compared to the previous month. R-PET clear flake and food grade showed the highest increase with prices rising by €100/tonne. R-LDPE natural film prices have risen by €90/tonne. Most other classes and types saw gains of between €30-50/tonne. The sharply rising cost of primary material supported recyclers’ push for higher prices.

Higher virgin polymer prices and shortening availability also led to more converters seeking alternative supply in the form of recycled material. Recycled plastics demand was particularly robust across the consumer goods sector driven by brand owners’ sustainability programmes.

There was sufficient material across most recycled plastics classes and types in April to fully meet demand from regular customers, although it was harder to find additional volumes required to serve new customers. High-quality material was, however, in shorter supply.

This month, higher production scrap costs and higher energy prices are leading to further recycled plastic price increases across the board. Supply is mostly reasonably balanced for R-LDPE, R-HDPE and R-PP. R-PET bottle scarp remains short, although there are reports of an increase in imports from the Middle East and Africa. Recyclers are at least able to serve their regular customers properly, although additional volumes remain a challenge.

For R-HDPE, slightly declining scrap material volumes and the continuing poor availability of additives are limiting the output of tube grades. Demand could thus noticeably exceed supply in this market sector.

Post-consumer recycled polymer prices, Western Europe, (€/tonne)

Recycled polyethylene terephthalate (R-PET)
In April, clear food-grade pellets and clear flake grades saw massive price hikes of over €100/tonne with coloured flake prices rising by €50/tonne. Rising virgin PET prices and bottle scrap costs supported recyclers' calls for higher R-PET prices.

PET bottle scrap, particularly for high-quality grades, was in short supply with bottlenecks and delays in logistics also adding to transportation costs.

More R-PET plastics buyers have been switching to virgin PET bottle grade material due to soaring R-PET prices. The gap between the two products has widened to a great extent, although prices for both virgin PET bottle and R-PET flakes posted 3-digit hikes in April. Many converters were no longer able to increase recycled content in their packaging considering the huge gap between recycled and virgin PET prices.

Recycled low-density polyethylene (R-LDPE)
In April, recyclers were able to raise R-LDPE prices without much discussion aided partially by the sharp increase in virgin LDPE prices. Natural film grades posted a price rise of €90/tonne with other grades rising by €30-50/tonne.

There was sufficient availability of recycled LDPE to meet demand although high-quality grades were in shorter supply and were more expensive.

R-LDPE demand was supported by converters switching from primary material to recyclate due to the sharply rising cost of primary LDPE.

Recycled high-density polyethylene (R-HDPE)
In April, R-HDPE prices increased by €50/tonne with recyclers able to push through gains without much resistance due to material shortages and sharply rising prices for primary material.

There was sufficient material available to serve regular customers although high-quality grades were in shorter supply and more expensive.

R-HDPE demand for consumer goods and construction applications was robust, while sales of black injection moulding material to the automotive sector slowed compared to the previous month.

Recycled polypropylene (R-PP)
R-PP prices increases slowed considerably compared to the previous month with gains of €25/tonne for homopolymer pellets and €50/tonne for copolymer pellets. Sufficient production scrap was available to serve the needs of regular customers. R-PP demand was supported by the sharply rising cost of primary material and by automotive producers topping up inventories.

Recycled high-impact polystyrene (R-HIPS)
In April, R-HIPS prices increased by €50/tonne aided by the sharply rising cost of primary material. R-HIPS sales increased as buyers of standard polystyrene switched, where possible, to R-HIPS, as primary HIPS has become very expensive and is in short supply. There was sufficient material available to serve regular customers but orders from new customers were often subject to allocation.