The downward price trend for recycled polymers which began late summer 2022 continued into February and March. Weak demand because of the economic downturn is the root cause of the downward price trend. Other contributory factors include more competitively-priced virgin material and the lower cost of plastic scrap.
Material availability remains on the low side as recyclers are reducing operating rates at their plants to avoid a supply overhang amid the weak demand. Nevertheless, there was sufficient material to meet demand across all product sectors over the last two months. Supply improved slightly in February as several recycling lines have been brought back into operation following maintenance. Material availability of recycled PET, polyethylene and polypropylene in particular has improved as additional capacity has come back come on stream.
Recycled PET prices posted the largest discounts in February with clear flake and clear food-grade pellets falling by €90-100 per metric ton. Recycled PP prices were down by €45-50 per tonne in February, while recycled high density PE prices fell by €30/tonne and recycled low density PE prices were down €30-40 per tonne. Recycled high impact polystyrene prices fell by only €10 per tonne.
Recycled plastics prices fell further during the first week of March. The price downturn could however lose some momentum over the next few months. While demand is quite likely to improve over the next few months as processors start to replenish stocks, demand is still well below normal levels.