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Report for the USA

In the USA, post-consumer plastics markets began the year strongly, with high prices for some. In the last month, however, there has been a gradual drop as summer volumes and recessionary fears cool the market.

PET Grade A scrap prices appear to have hit a plateau and are expected to gradually decline as summer volumes ease demand pressures. The same is predicted for Grade B scrap despite the steep rise in prices over the previous quarter; indeed, the price became so inflated by East Coast buyer competition for bales that B and BwTF (B with thermoforms) were at the same level over several bid cycles. This dynamic is slowing as the traditional fibre market on the East Coast has restricted sales in anticipation of reduced demand for carpet owing to an economic slowdown and a cooling housing market. Together with summer volumes, this has resulted in an increase in the East’s bale inventories which has driven a downward correction in the Grade B market.

Selling to export buyers has been fraught with difficulties owing to shipping delays, container shortages and increased fees, to the extent that several companies and recyclers are avoiding overseas sales.

The polyethylene price has dropped by US$ 0.05 in recent weeks as high inventories and summer volumes moderate markets amid falling demand. LDPE clear film is the exception as it continues to be a sought-out commodity for which prices are holding firm.

The drop in virgin polypropylene pricing has had an impact on post-consumer resin, bringing a decline of around US$ 0.07. As with other resins, demand has weakened in the face of well-filled inventories and high summer volumes.

Owing to recently-passed extended producer responsibility legislation, the future of polystyrene packaging is under some pressure, with manufacturers turning to the more widely collected and recycled PET. Currently, PS material is not collected in sufficient quantities to stimulate a recycled resin market.

Despite reclaimers buying and processing material, the fear of an economic downturn has persuaded some manufacturers against running at full capacity, preferring to run down their significant inventory. High inflation and elevated fuel costs have caused export buyers to pull back, shrinking markets even further. After months of suppliers being in the driving seat, it is currently a buyer’s market and we are seeing pricing corrections across the USA. This dip may well resolve itself with the approach of autumn and winter.