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September 16, 2002 02:00 AM

PET rate holds its own in '01

Steve Toloken
Assistant Managing Editor
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    The recycling rate for PET containers held fairly steady in 2001, at 22.1 percent, as a booming Chinese export market took up the slack for weak recycling demand late in the year when the U.S. economy sputtered, according to the PET industry's trade association.

    Collection of PET went up significantly for the first time since 1998, and officials predict increased demand from both the fiber and soft drink industry in coming years.

    The National Association for PET Container Resources in Charlotte, N.C., reported that collection of PET for recycling rose 8.4 percent in 2001 to 834 million pounds.

    The increase did not quite keep pace with the increase in PET used in beverage containers, fueled mainly by juices, waters and isotonic drinks converting to PET. The amount of PET used in beverage containers jumped 9.3 percent, to 3.7 billion pounds.

    Still, the recycling rate held steady after plummeting like a stone in the past half-decade. In 1995, by comparison, the recycling rate for PET containers stood at 39.7 percent.

    NAPCOR noted that Coca-Cola Co.'s decision to use 10 percent recycled content in many of it bottles was a significant driver in the market. But while Coke won much public attention, another company's decision to use more recycled PET could have a bigger impact.

    Beaulieu Fibers of Dalton, Ga., decided Jan. 1 to use recycled PET exclusively, NAPCOR said. That represents a 15 percent increase in demand for that sector, NAPCOR said.

    The fiber market used 435 million pounds of PET in 2001, more than 60 percent of the recycled PET used in the United States. A 15 percent increase in fiber demand would require about another 65 million pounds.

    Add to that a soft drink industry that is boosting use of recycled PET, and demand seems likely to grow.

    According to a conservative calculation, the PET industry might need at least another 120 million pounds a year to meet anticipated demand from Coke and PepsiCo Inc., if both companies meet pledges to use 10 percent recycled content in their PET bottles by 2005.

    Here's why: In 2000, the soft drink industry used 1.7 billion pounds of PET in the United States. Coke and Pepsi have about 75 percent of the market, using nearly 1.28 billion pounds of PET, and 10 percent of that is about 120 million pounds.

    Last year, by comparison, the food and beverage industry used only about 77 million pounds of recycled PET.

    ``Supply will get tighter if we don't increase collection,'' said NAPCOR President Luke Schmidt. ``At the moment, there are only so many bottles out there being collected, but there are many more not being collected.''

    Of course, what to do about collection remains a political hot potato. Industry groups like NAPCOR maintain that cities should spend more to get more materials from curbside programs, while environmental groups and some politicians advocate more bottle bills.

    Pat Franklin, executive director of the Container Recycling Institute in Arlington, Va., said that even as collection rises, more and more PET is being thrown into landfills.

    ``The bottom line is, we discarded nearly 3 billion pounds of plastic PET bottles [in 2001],'' she said. A national bottle bill pushed by Sen. Jim Jeffords, I-Vt., would triple the available supply, Franklin said.

    Schmidt said NAPCOR does not have a clear picture about why collection increased last year. One major source seems to be California. Figures from that state suggest that about one-third of the nation's 65 million additional pounds of PET recycled last year came from the Golden State's bottle bill.

    California's bottle bill resulted in 138 million pounds of PET recycled in 2001, up from 118 million in 2000, according to a state Department of Conservation spokesman. The state recently expanded its deposit law to cover new types of containers.

    Whatever the politics, Schmidt said he expects both the food and fiber markets to want more recycled PET in the next few years.

    Overall, NAPCOR reported that use of recycled PET by U.S. industry actually fell in 2001, to 701 million pounds, as the weak economy in late 2001 dampened demand. As prices fell, Chinese companies grabbed all available supply, sending a record-high 234 million pounds outside the United States, NAPCOR said.

    ``Often in the fourth quarter, Chinese buyers were competing only with themselves for U.S. material,'' NAPCOR said. ``It is now apparent that China has a reclamation infrastructure as large or larger than the U.S., [and China] depends heavily on U.S. imports.''

    Of the 234 million pounds exported, about 25 million went to Canada and the balance went to China, NAPCOR said.

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