United States

Launching into 2023, the plastic recycling industry is experiencing the same issues as in the final quarter of 2022. The outlook for the rest of the current year is uncertain, with many of the same factors from 2022 impacting the present, such as the Ukraine conflict, high energy prices, inflation, the economic slowdown and China’s uncertainty about opening or closing its ports from a COVID lockdown. These economic indicators are critical to navigate the recycled plastics markets as it is an industry driven by consumer expenditure, with ties to economic activities in durable consumer goods and building construction. There is some hope that the market will improve as inflation appears to be easing and the anticipated recession has not materialized.

PET market demand remains stable, with reclaimers purchasing at consistent levels. The price has remained flat, with little change from the last quarter of 2022. The main concern for US reclaimers is the price of imported virgin PET which is selling for as low as US$ 0.60 per lb, making it difficult for domestic rPET producers to compete and move their finished goods.

Major refurbishment of several facilities in California is nearing completion, which will provide greater volume for bottle-to-bottle production to help meet the state’s ambitious content mandates. Meanwhile, a major East Coast carpet manufacturer has resumed purchases, thereby buoying the market and providing stability.

In the polyethylene market, natural HDPE has seen little change over the last four or five months, with a slight uptick in the price over recent weeks. The main reason is that East Coast buyers are more aggressive than those in the West and are offering over US$ 0.01 per lb more. This is a positive step towards seeing the market improve as confidence grows.

In contrast, coloured HDPE continues to be flat; there is little demand from domestic buyers and so exports remain the best option.

There has been a consistent and steady domestic market for clear LDPE and export buyers cannot compete, offering US$ 0.04 per lb less than their domestic counterparts. Coloured LDPE is low in value but retains a loyal domestic market, with export buyers unable to be competitive on price.

For polypropylene, a major East Coast buyer has increased its purchases and has returned to buying on the West Coast, providing some relief and even buoyancy to the market. Likewise, export buyers of PP are competing and are able to match the prices offered by domestic purchasers, thus increasing confidence in the market. However, it is worth noting that prices are down 50% compared to this time last year, highlighting the major drop experienced across the industry in the second half of 2022.

As a commodity, PS struggles the most among the recycled plastics markets. Only PS which is sorted and clean, such as EPS, has value and a stable export market offering US$ 0.12 per lb above domestic prices. One of the reasons for the price differential is that demand was curbed by several domestic reclaimers closing their facilities on the West Coast. Rigid PS bales are attracting low to limited demand; indeed, there is talk in several US states of banning it altogether as the recycling rate for this material is so low.

The USA has seen much discussion and investment in the plastic recycling industry, with conversations centring around recyclability and sustainability at the state government level. US reclaimers have been spending money on upgrades and improvements to their facilities, with several states adopting extended producer responsibility legislation, and discussions are continuing to take place at the national level. The future looks promising and hopefully the second half of 2023 will see scrap prices increase as confidence in the economy improves.