Promising signs for plastic scrap

The plastic scrap market in Europe appears to be gaining traction, although challenges remain evident for many lower-value grades. The absence of Chinese buying has been one of the biggest impediments. Several sources say Chinese consumers have become more circumspect with imports of a range of plastic grades, especially mixed loads and some film grades.

Adding to the concern over low-quality material being shipped from European sources to China has been the Chinese economy, which has cooled through most of 2014. The drop in demand has forced more exporters to shift shipments to other Asian countries such as Vietnam and Malaysia.

China also is taking some steps that will affect plastic scrap markets. In a Bureau of International Recycling (BIR) report provided by Steve Wong, chairman of the China Scrap Plastics Association, Wong notes that starting Jan. 1, 2015, China’s Ministry of Environmental Protection will be not handling applications for pre-approved solid waste. Instead, he points out, importers will have to apply to the municipal environmental protection department through the nationwide electronic solid waste management system to get approval from the provincial government department.

Wong says steps taken by China to strengthen plastic scrap markets in China include the possibility of Chinese customs canceling the zero-tariff preferential treatment for plastic scrap being imported, recycled into raw materials and turned into products for exports.

In Europe, polyethylene terephthalate (PET) and high-density polyethylene (HDPE) continue to be fairly stable throughout the continent, although there are parts of Europe that remain weaker.

The natural HDPE market in Europe, which had seen significant interest from U.S. consumers earlier in 2014, seems to have eased a bit. There were reports during 2014 that U.S. demand for the grade had been high enough that some European plastics recyclers were diverting material to U.S. destinations.

That trend seems to have cooled off. Prices for the grade in the U.S. have declined, which has slowed the flow of material from Europe to the United States.

Supporting the growing interest in plastics recycling throughout Europe, Gary Claypole, sales director for U.K.-based MBA Polymers, highlighted his company’s efforts to boost the recycling of plastics throughout Europe. In a presentation made during the Plastics Recycling Europe Conference, held in Milan, Italy, in late October 2014, Claypole highlighted MBA’s efforts to develop end markets for different grades of plastic scrap.

Another factor helping drive plastic markets is the pressure by legislators in Europe to restrict, ban or tax different types of plastic. At Plastics Recycling Conference Europe, Martin Wiesweg, with the consulting firm IHS and based in Germany, said plastic recycling markets are being driven by legislative policies that are being debated by various organisations.

One plastic grade that is seeing increased pressure has been low-density polyethylene (LDPE). An agreement has been reached between the European Parliament and member states on a proposal to ban plastic bags (often made from LDPE) throughout the continent.

In late November the European Parliament came to an agreement on EU-wide legislation that would require member states to reduce the use of plastic bags. Under the agreement, individual countries would have to reduce consumption by 90 lightweight bags per citizen by 2019, and 40 additional bags by 2025; or have a mandatory charge put in place by 2018. Member states also could introduce a ban on the bags.

Industry association PlasticsEurope expressed concern over the Parliament’s move, suggesting that a ban could set a precedent that will lead to a patchwork of national regulations on other types of packaging as well.

Also commenting on the changing regulatory front was Plastics Recyclers Europe President Ton Emans, who predicted that 2015 will be an important legislative year with regard to plastics recycling.