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The future of recycled plastics looks bleak for the beginning of 1997, especially for PET.

Prices have fallen as a result of expanding capacity for virgin resin. Although those in the industry don't agree on how quickly the market will recover, many do agree that prices are not going up anytime soon.

Despite the slowdown, and in some cases the shutdown, of recycling operations, a study conducted by Seattle-based R.W. Beck and Associates for the American Plastics Council reports that the number of facilities accepting post-consumer plastics has increased 10 percent, from 1,546 in 1995 to 1,705 in 1996.

Nevertheless, the number of large-capacity reprocessing facilities that ceased operations last year was alarming.

In PET processing, Boston-based wTe Corp. and PureTec Corp. of Ridgefield, N.J., each closed a plant in 1996. Signode Division of ITW Inc. is preparing to close its Plastic Recycling Alliance PET recycling plant, claiming it is cheaper to buy virgin resin than to recycle post-consumer PET.

Consultant Peter Anderson of RecycleWorld estimates two-thirds of the strictly PET reprocessing companies in the United States went out of business last year. Leading recycler Wellman Inc. still accepts post-consumer PET, but other companies such as RIB Corp. in Chicago, and American Plastics Inc. in Akron, Ohio, have stopped accepting PET.

Long the darling of plastics recycling, PET reached an all-time low price last year, plummeting about 40 cents per pound. Speculation as to when the market will stabilize and how to facilitate positive movement varies widely.

Perhaps the most optimistic voice in the industry belongs to Dennis Sabourin, vice president for post-consumer procurement and recycling industry affairs for Wellman of Shrewsbury, N.J.

``PET recycling is alive and well,'' he said. ``The market is going to continue to be dominated by end-users.''

He expects price stabilization this year as the amount of off-spec virgin resin stabilizes. Most major virgin PET suppliers added capacity in the past year.

Sabourin said he believes there has been an unrealistic expectation of the value of recycled PET.

``There's no company with `x' pounds of PET that can't be moved. They're just not happy with the price,'' he said.

Peter Lobin of RIB Corp. said he is an optimist, predicting a loosening in the market toward the end of the year or the beginning of 1998. But for now, things look gloomy.

``There's a potential loss of infrastructure — collection and processing,'' he said. ``That's a scary thought.''

Anderson added, ``It's not a healthy future at all — it's very bleak.''

Some recyclers hope the export market will improve, especially to China. That could force prices up, said Kevin Copeland at American Plastics. However, Sabourin does not see that happening this year.

``The export market will be less important in 1997,'' he said. ``With the rapid growth of virgin [PET capacity] in Asia, it will be used there.''

Sabourin said recycled material, PET or otherwise, will continue to be used because firms have a marketing requirement to use recycled material in products.

Recyclers have offered several ideas in the fight to keep PET recycling viable. Anderson argues for a major restructuring of the entire process, beginning with a redesign of bottles to make them easier to recycle.

``There needs to be a balance between improved efficiency and meeting the needs of the consumer,'' Anderson said.

Sabourin said collection continues to be the most important factor in the future of PET recycling. APC reported that the number of communities with curbside collection increased in 1996. But as prices fall, recyclers expect some to stop collecting plastics.

Anderson said he believes it is not a matter of people not caring about recycling, but rather a lack of understanding of the recycling infrastructure.

The market for post-consumer high density polyethylene also had high-profile setbacks in 1996. Union Carbide Corp. closed its HDPE reprocessing plant in Piscataway, N.J., and Rutgers University shut its Center for Plastics Recycling Research. Nevertheless, Lobin believes the market is stable.

``It's been through enough cycles. It's a well-tested market and can carry the load for PET,'' he said.

However, with virgin HDPE suppliers set to add 6.5 percent to their total production capacity around the world this year, some recyclers wonder if a drop in virgin prices could push down post-consumer HDPE as well. Besides packaging applications, HDPE is surging in the plastic lumber industry.

Other recycled materials such as polypropylene and polystyrene continue to hold steady, maintaining their current prices.