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Report for the USA

In March, the main takeaway from the largest US plastic recycling conference was the negative impact cheap plastic imports have had on the domestic industry; this is especially true for PET. A recent report stated that PET imports have increased year over year by 33%. This influx has affected all PET reclaimers, but especially those on the West Coast as it is the first port of call from South East Asia from where most of the PET imports originate.

Mexico continues to be an aggressive buyer of PET bales to meet increased demand as a result of expanded capacity. Bale prices are likely to slowly subside as warmer weather sees an increase in consumer purchasing and thus higher collection volumes. This anticipated drop in bale prices will be of slight relief to domestic PET reclaimers who are being squeezed between the high cost of bales and the low cost of cheap imports, making it difficult to remain competitive.

Recent freight increases will provide some minimal relief to domestic manufacturers, with the higher rates caused by geopolitical developments affecting and destabilizing international transportation. Climbing haulage costs have pushed up import prices for PET flake and finished goods, more so on the East Coast than on the West. On the whole, it has been a tough six months for domestic reclaimers, with no immediate end in sight. It is hoped the summer months will see lower bale prices as a result of increased collections and an improvement in end-markets demand.

Unlike PET and the impact of inexpensive imports, both colour and natural HDPE have maintained an equilibrium between supply and demand. Consequently, prices have remained stable, with little competition from exports that rely on supply from the West Coast and domestic buyers from the East, creating balanced market conditions. The end demand from both is flat, with little increase in manufacturing capacity. The same is true of LDPE, which remains stable and with limited growth in end-market demand. A major domestic plastic lumber manufacturer has switched to buying under contract, with the result that there is sufficient supply to meet the needs of other domestic producers and the export market.

Currently, Mexico is the dominant force in the PP market, especially in the West from where most of the available material is being purchased. The largest domestic producer buys mainly in the East, thus creating a balanced and flat market with little expansion. End products for PP are for industrial applications as opposed to packaging.

At present, high-quality densified polystyrene is enjoying a stable market catering to both domestic and export demand. In contrast, lower-grade PS and expanded polystyrene are facing a scarcity of options and buyers, a challenge exacerbated by the increasing number of jurisdictions implementing bans on PS foodservice packaging.

This year has generated significant uncertainty over future market conditions and subdued demand. While demand in most post-consumer recycled markets has been lacklustre yet stable, PET has faced challenges owing to the surge in inexpensive imports. Expectations are pinned on the next quarter witnessing an upswing in demand, with hopes that the rise in freight prices will incentivize end-use buyers to return to the domestic market.