European recycled standard thermoplastics prices declined further in June and the downward price pressure continued into July. Recycled plastics prices are under severe pressure because of persistent weak demand caused by the economic stagnation throughout Europe and competition from the falling cost of off-spec virgin plastics and cheaper imported recyclates.
At the same time, weak demand has led to a surplus supply situation, despite many recyclers curbing output to limit a build-up of inventories.
The market position for recycled PET is particularly perilous. As the cost of virgin PET has fallen by €700 per metric ton since July 2022, converters have increasingly switched to using a larger volume of standard material, despite a similar reduction in recycled PET prices over the same period. A price war has subsequently developed between recycled PET and virgin PET which makes it very difficult to operate the recycling plants economically.
In June, recycled PET clear flake prices crashed €150 per tonne, clear food-grade pellet prices fell by €100 per tonne and colored flake prices were €50 per tonne down on the previous month.
Other recycled plastics classes also continue to suffer from declining prices due to very weak demand, competition from virgin material and lengthening supply.
In June, recycled high density polyethylene blow molding prices declined €50 per tonne while injection molding grades fell by €30 per tonne. Recycled low density PE natural film prices fell €60 per tonne with recycled LDPE translucent film prices down by €40 per tonne. Recycled polypropylene homopolymer and copolymer prices declined €70 per tonne in June with recycled high impact polystyrene prices €20 per tonne lower than in the previous month.
Recycled plastics prices remained under downward pressure during the first two weeks of July. Market fundamentals are unlikely to change significantly this month, although the beginning of the summer holiday season is likely to depress demand even further.
