Cause for Excitement

A PET processor sees many reasons to be excited about the future of PET recycling.

July 28, 2010

ReThink Recycling is the owner of PureTech Plastics, which is a reclaimer and recycler of primarily deposit PET (polyethylene terephthalate) materials from across the East Coast. The PureTech plant is based in East Farmingdale, N.Y. Our holding company is based in Chicago.

We see an amazing opportunity for PET recycling for a lot of different reasons, which I will go over. We are very excited to be a part of this and very excited to be on the cusp of what is going to be explosive growth and the opportunity that we think is in front of us.

Last year alone, a record 2.4 billion pounds of PET were recycled, which is an amount that continues to expand. The uses of RPET (recycled PET) continue to grow. Historical markets in carpet, fiber and strapping have really exploded into the consumer area, with RPET used in everything from fibers for athletic gear, luggage and mattresses to food and beverage containers. The diversity of the product mix and the fact that those products are all starting to expand is part of why we get so excited, because there are a lot of markets that are just now reaching into using RPET.


One of the reasons PET recycling is growing is the environmental awareness from the consumer perspective backed up by the science that is starting to come out. A study was recently announced that said the energy savings from recycling PET and HDPE (high-density polyethylene) would be equivalent to the energy needed to power 750,000 U.S. homes. That’s the kind of big news that captures headlines in today’s environment. The opportunities that can ride in the wake of that kind of news are exciting.

Besides the big brand owners, big retailers like Walmart and others have announced sustainability initiatives for their suppliers. And, of course, there is a lot of legislative activity around the initiative as well. That has helped to create growing demand. And demand also is being created in new markets, such as thermoforms.

Really, the key driver is the push by the big brand owners who are interested in using post-consumer content in their packaging for a variety of reasons. Consumers are certainly interested in participating so they can feel as if they are doing their part. They are putting pressure on the big brands that they know and trust to incorporate recycled content into their packaging.

What we need to do is participate and do our part in converting that packaging back into usable material.

Let’s take a look at what some of the big brand owners are saying. Obviously Coca-Cola is here and went over all of their initiatives in great detail. As Bill (Tynion, national recycling manager for Coca-Cola Recycling) said, their Web site is up and available and all of their initiatives are ongoing. Everyone, I think, has seen the plant that they are partnered with in Spartanburg (S.C.), which is committed to producing about 100 million pounds of food-grade recycled plastics per year. There are a lot of things going on within the world of Coca-Cola. (For more information on Coca-Cola’s efforts, see “The Real Thing,” in the February 2010 issue of Recycling Today.)

Pepsi also has been in the news a lot lately. They are intending to also promote higher rates of beverage container recycling, looking to get 50 percent of their beverage containers recycled by 2018. They just announced a new initiative, which is a kiosk, which is pretty exciting. They plan to put out more than 3,000 of these in partnership with Waste Management. They believe that this kind of innovation can help them recycle at least 400,000 million containers annually. We look forward to seeing those get rolled out. Again, it is all about the awareness and brand image for companies like this.

Convenience is a big factor in helping the consumer, given the portability of PET. It is going to be important to have portable and easy ways for consumers to have somewhere to put their containers. How do we make sure that recycling can happen in public spaces? Again, it is a matter of awareness and making it convenient for customers to take that soda bottle or water bottle or whatever they might be carrying and put it somewhere where it can be put back into the [raw material] stream.

In 2008, the PET recycling rate was 27 percent. The good news is that that’s a record high. The bad news is that that’s a record high. Twenty-seven percent certainly leaves a lot of room for improvement in PET recycling.

That year there were almost 1.5 billion pounds of material reprocessed here in the U.S. But there’s a lot of room to grow.

What is driving that improvement is big increases in places like California, which had a 37 million pound increase; dozens of new collection programs; and several new expansions in the world of deposit programs, both new states and, more recently, New York and Connecticut adding water bottles to their deposit legislation, which greatly increases the supply. (There is a lot of chatter about other states changing their deposit laws to include water bottles if they don’t already and possibly some other states switching over to deposits.)

From our perspective, that is the biggest challenge: How do we get our hands on the remaining 70 percent of bottles that are out there and turn PET into a truly sustainable material.


Because demand is rising at least as fast as collections are increasing, our prices are increasing from a supply perspective. That is one of our biggest challenges. Last year, the price of bales grew from around 10 cents (per pound) to nearly 20 to 25 cents (per pound) in the course of one year. It has continued to rise over the course of 2010, with some people saying that it may get as high as 30 cents, though it has certainly stabilized in the last few months.

Today, because of the conversion costs involved in taking those bales and turning them back into food-grade flakes and pellets, in certain markets, RPET is selling for higher prices than virgin PET. For us, that’s exciting, but we are a little bit uncertain as to how stable that it. We feel like in the past, RPET was always linked to the price of virgin PET and had to be at the most at parity with it. We have become delinked this year. Again, I would love to see it be a permanent trend, but you can’t count on that.

Another thing that has changed because of some of the conversion technologies that have reached the U.S. is that it is becoming less important what the source of the bales is. Historically, to make food-grade RPET, it was important to have deposit grade input because it was such a cleaner stream. Now there are certainly ways to make the curbside bales clean enough to use those for food-grade applications. That in conjunction with some of the initiatives that are going on in the collection side is exciting from our perspective as well.

The important thing going forward is going to be having the MRFs (material recovery facilities) and the collection agents and the sorters really focus on what the PET yield from a bale is. Right now, we pay about 25 percent more for a deposit bale than a curbside bale. As the technology changes and, hopefully, the sortation technology gets more efficient, we would expect to see that spread change and shrink.


Because of the demand initiatives and the size of the companies that are driving those demand initiatives, we expect to see more than 250 million pounds of new conversion capacity put into the U.S this year. It is going to be important as that comes online for more of the current and growing supply to stay within the U.S. Currently, as much as 40 percent of the supply goes to China, primarily off the West Coast, because that’s where it’s logistically more economical to do.

But there’s simply not the reclamation capacity in the U.S. right now to keep track of that material that is there. It is important to have that stream and to keep that material moving, and, right now, China can take it. It is going to be important as this new capacity goes online to keep this material in the United States and to keep these plants full. We expect clearly in 2012 and 2013 for more capacity to come online. The other good message that can go along with keeping that material here aside from the sustainability and environmental impact and messaging that can go along with that is, if we can keep that supply here and continue to open new plants in the United States, there’s a green jobs message that can go with that. Each of these plants creates 50 to 75 jobs, depending on the number of shifts that are run. That is a good message in today’s world.


One of the new emerging sources of supply that we are excited about that is starting to come online is thermoforms. The bottle has been the traditional source of supply, and even that at 27 percent is just underway. But, thermoforms, we think, will be an exciting source of supply that is just starting to come on.

Right now, equipment suppliers and washers are working on how to handle, sort, reclaim, separate and wash this material. APR (Association of Postconsumer Plastics Recyclers) and NAPCOR (National Association for PET Container Resources) are hard at work to help MRFs recognize and sort this material. It is typically not as brand-oriented as bottles, but the thermoformers are getting the same pressure from legislative initiatives and folks like Walmart to make sure their packaging is sustainable, so they have a lot of the same incentives as the big brand owners do. We are active in helping the collectors search out ways to sort this material. We are excited about thermoforms as a new source of supply.

I’m sure a lot of you have seen the book, 212: The Extra Degree. We feel that we are at 211 degrees in PET right now, and if we can get it to that next degree, we can get it from hot water that can do some damage to boiling water that can drive an engine. We think it is an exciting time that can really make a difference in our industry and your industry as all of this comes together. We are very excited about what the near-future and the long-term future hold in regard to getting the big brand owners what they need in terms of high-quality RPET, getting thermoforms as a new source of supply and getting those plants build to convert that supply into RPET.

The author is co-owner and CFO of Chicago-based Re:Think Recycling Group, which helps multi-national companies find solutions for their waste material. Re:Think Recycling Group owns PureTech Plastics, a PET reprocessor based in East Farmingdale, N.Y.











May 2010: 260.0
Dec. 2009: 242.1
May 2009: 221.6
Dec. 2008: 227.1

RPET consumed in carpet manufacturing declined in 2008, as it did in the strapping and automotive industries, according to figures from NAPCOR.

Thirty to 40 percent of the PET recovered in the U.S. is shipped to China, according to estimates.

Brand owner demand is the primary factor influencing the consumption of RPET.