Recovered polyolefin plastic prices made considerable gains in the last year, with high-density polyethylene (HDPE) and polypropylene (PP) reaching previously unseen levels. However, as the year drew to a close, those prices had softened.
“Bale prices for both natural and mixed-color HDPE have seen very significant and rapid declines in a short period of time during October and November,” says Roberto Fontanillas, vice president and general manager of Envision Plastics, which has locations in Chino, California, and Reidsville, North Carolina, though he is based in the Atlanta area.
Some sources Recycling Today spoke with in the late summer of 2021 said they felt a plateau or correction would be imminent for polyolefin scrap grades, with one reprocessor noting that pricing already was moving sideways in August.
During the fourth quarter, as virgin capacity disruptions that affected HDPE and PP were corrected and more prime material was available, pricing for recycled material took a hit.
“Bale prices for both natural and mixed-color HDPE have seen very significant and rapid declines in a short period of time during October and November.” – Roberto Fontanillas of Envision Plastics
Fontanillas also says HDPE scrap availability appears to be more plentiful than it was early in 2021.
But demand for postconsumer resin (PCR) remains generally healthy. Fontanillas says demand for Envision’s natural HDPE, its color-specific Prisma line and its food-contact EcoPrime is strong. “We are seeing some seasonal end-of-year demand softness, but we expect demand to revert to the long-term growth trend line in the new year,” he says in mid-December 2021.
PCR pricing also remains higher than its virgin equivalents, he says. “We have seen historic spreads between the two this year, and we see the potential for the two to decouple as society and markets increasingly value recycled plastic as a more sustainable material.”
He says challenges always are present as are reasons for excitement. Fontanillas adds, “On balance, we are super excited about the future for recycled plastics and look forward to continuing our work to be a leader in differentiated recycled polyolefins plastics to help brand owners and converters grow their businesses by helping them achieve their sustainability goals.”
In the polyethylene terephthalate (PET) sector, a reprocessor based in the Northeast who deals exclusively with deposit material, says 2021 was “one heck of a year” for pricing and demand.
“There is big demand for high-grade clear flake from fast-moving consumer goods companies and the consumer packaged goods companies,” he adds.
The PET reprocessor says export demand also is growing, with buyers offering strong prices.
While he says the first quarter of the year is generally the worst for pricing, he is not anticipating the associated decline in demand. Therefore, he says, “Pricing will maintain where it is.”
Explore the January 2022 Issue
Check out more from this issue and find you next story to read.
Latest from Recycling Today
- SA Recycling makes diversity honors list
- Property in northwest Ohio considered for new MRF
- Recycling Today Media Group launches the Battery and Critical Metals Recycling Conference
- Amcor to invest $250K into Circolution
- WM sees less growth in its collection and disposal volumes year over year
- Direct Pak, City of Phoenix reclaim more than 16 million pounds of recycled PET
- Western Placer WMA joins Bye Bye Mattress collection program
- Call2Recycle Canada, GFL partner to expand battery recycling capacity in Western Canada