Despite the continuing sluggish economy, the use of recycled PET in food, beverage and non-food containers is rising dramatically, as retailers and consumer product companies continue to make more commitments to packaging that uses recycled resin.
The amount of post-consumer recycled PET used in food and beverage bottles jumped 44 percent in 2009 to 203 million pounds — the first significant increase in four years and its highest level ever, according to the PET recycling report issued jointly by the National Association for PET Container Resources, the Association of Postconsumer Plastic Recyclers and the PET Resin Association.
Similarly, although it wasn't as large of an increase, the amount of recycled PET used in non-food packaging bottles rose 18 percent — from 55 million pounds to 65 million pounds in 2009, slightly more than its previous high-water mark in 2004 and 2005.
What's more, a record 937 million pounds of recycled PET were used in manufacturing applications, up 2.4 percent from a year ago. That's despite drops in recycled PET usage, related to the economy, in strapping and fiber, which remains the largest end-market for recycled PET.
“There is a concerted effort to use more recycled content in food and non-food containers,” said Dennis Sabourin, executive director of NAPCOR, in a phone interview. “Demand is outstripping the supply of bottles, driven by sustainability initiatives from retail companies and consumer product goods, and public demand.”
In addition, the PET recycling rate, which had fallen as low as 19.6 percent in 2003, increased for the sixth straight year to 28 percent — its highest level since 1997. “The recycling rate is still trending upward,” Sabourin said.
Clearly, part of that increase in the recycling rate can be attributed to less resin used in PET bottles and containers for the second year, because of lower sales in a weaker economy and continued lightweighting initiatives.
PET resin used in bottles and jars that was available for recycling dropped by 4 percent, or 217 million pounds, in 2009. That follows a drop of 5.6 percent, or 317 million pounds, in 2008. That dropped the amount of resin used to 5.149 billion pounds, the lowest level since 2005 when 5.075 billion pounds of PET were used to make PET containers and bottles.
Despite the continued climb in the recycling rate the last two years from 24.6 percent to 28 percent, the amount of PET bottles recycled, in pounds, remained essentially flat at 1.444 billion pounds. That's down slightly from 2008, when 1.451 billion pounds were recycled, and only slightly higher than the 1.396 billion pounds of PET bottles and containers recycled in 2007.
The China factor
Approximately 725.7 million pounds of that recycled PET was purchased “mostly by Chinese traders,” along with the approximately 22.7 millions of recycled PET China purchased as part of mixed plastic bales, according to the Oct. 20 report. That means 55.6 percent of all recycled PET bottles and containers are exported, almost all of it to China, which is similar to a year ago. It is the fourth straight year that China has purchased more than half of the PET bottles collected in the United States, the report said.
Canada purchased 53 million pounds of recycled U.S. PET in 2009.
Still, the volume of PET purchased by U.S. recyclers, after dropping slightly in 2008, bounced back to 642 million pounds, the second-highest amount ever, exceeded only by the 681 million pounds purchased in 2005.
But those purchases of domestic recycled PET remain well below what would be needed to run all the PET reclamation plants in the U.S. at full capacity. NAPCOR estimated that U.S. PET reclamation capacity was 1.029 billion pounds at the beginning of 2009 and 1.247 billion at the end of 2009.
In addition, more than 200 million pounds of PET reclamation capacity came on line in 2010, with more capacity scheduled to come on-stream in 2011. More than half of the industry's PET reclamation plants can produce food-grade PET, a dramatic change from just a few years back.
As a result of the capacity and available supply imbalance, the industry still continues to need to buy recycled PET from Canada, Mexico and South and Central America, and to use alternative PET feedstock such as pre-consumer bottles, post-consumer strapping and other unprocessed industrial scrap, said the report.
The amount of PET bottles collected and recycled in the U.S. could meet the demand levels and satisfy the capacity of PET reclamation plants in the U.S., but not as long as China continues to purchase more than 55 percent of the PET collected.
“China is still continuing to use a significant percentage of the PET bottles collected and recycled and that is not likely to change any time soon,” Sabourin said.
Moving goal posts
As a result, the report said “the [PET] recycling rate will need to increase to at least twice what it is this year” or to above 56 percent, “to provide the market with the [recycled] PET it needs, at sustainable pricing — both now and in the future,” assuming China continues to buy at the same levels.
That could create supply shortages or lead to market price increases for recycled PET in the future. “This combination of high demand and inadequate supply means higher pricing is likely to come — possibly in excess of” prices for virgin materials, said the report.
However, Sabourin remains encouraged by PET recycling collection trends.
According to the report, more than 46 new collection programs began in the U.S. in 2009. In addition, the report said there were six major program expansions and 52 program expansions/conversions to single-stream recycling affecting more that 3.7 million households.
The report further notes that there is “renewed interest in recycling — driven both by the business sector's embracing of the sustainability ethic and by the public's concern about the environment.”
“[That has] led to the creation of more container recycling collection opportunities, both residential and away from home [and] helped offset the reduced volume of PET bottles and jars available for collection,” said the report.
The challenge, Sabourin said, is to bring into the recycling stream products such as thermoformed PET packages “that have not been part of the typical packaging recycling stream.” Both NAPCOR of Sonoma, Calif., and APR of Washington are working on initiatives to increase the recycling of thermoformed PET packages and eliminate technical barriers to processing and recycling such packages.
The use of recycled PET in the U.S. rose 2.4 percent led by the gains in food and beverage bottles and non-food bottles. However, recycled PET used in fiber applications, declined 12 percent in 2009 and the use of recycling PET for strapping fell 16.7 percent.
Overall, fiber remains the biggest end market for recycled PET at 344 million pounds, accounting for 36.7 percent of all recycled PET used. But food and beverage has leaped into second place among end-use categories and now uses nearly 21.7 percent of all recycled PET resin collected and recycled. Sheet and film remains the third-largest end-market.
This is the fifth year NAPCOR, APR and New York-based PETRA have partnered to produce the annual recycling report. Data for the report came from data internally generated at NAPCOR, PETRA and the International Bottled Water Association, as well as from surveys conducted by Moore Recycling Associates and HDR Inc.