Market Update for the prime, recycled, and scrap plastics as of April 28, 2023.

Prime virgin prices are sourced from major virgin polymer websites in China and quoted in Renminbi (RMB), with an exchange rate of 1 US dollar, equalling Chinese Yen at 6.9184.

New York oil prices closed at 76.78 per barrel on Friday, setting for second weekly decline on disappointing economic data, interest hikes from the US, and concerns about China’s lower-than-expected fuel demand.

Prime prices in China continue to weaken amid supplies and high stock levels. Apart from PET and polyethylene, millions of tons of new capacities came online this year; Polypropylene is reported to have 8 million tons of new capacities in 2023. Saudi Arabia and the US have offered reduced-price cargoes to China and Asian countries. The latest manufacturing PMI contractions, property market downturn, and global financial uncertainty raise doubts over the strength of Chinese recovery momentum. Nearly all prime resins have slid in China before the May Labour Day holiday, especially since the traditional low seasonal demands are just around the corner from May till mid-August. There are reports of PET, ABS, PS, PE, PP, NYLON, POM, and POLYCARBONATE exported to Europe, Africa, America, and Asian countries due to price competitiveness. The shipping cost has reduced tremendously; cheap cargoes have also impacted the global markets. There is a need to reduce the building of new plants to bring over supplies under control. Prime prices are lower than recycled materials would eventually lead to less plastic waste being recycled, resulting in more plastic waste ending in the environment.

Recycled materials are selling lower following the reduced prices of prime materials, except for Post Consumer Recycled, natural HDPE pellets from production sell at $ 800 per ton, whereas PCR milk bottles sell at $2750-3100 per ton; natural PET flake and pellets sell $ 600-700 per ton, whereas PET FDA approved PCR sells at $1650 -$2000 per ton; PP injection black sells at $650-680 per ton; whereas PP, PCR black sells $ 1550-$2000. PP and LDPE black pellets could only sell for $ 650 per ton, and label and caps PP/PE are less than $600 per ton. Most recyclers sell non-PCR materials at prices that do not even cover production costs. More recycled materials are on different websites and media platforms for sale. Low-cost imported prime materials impact the US, Europe, Turkey, and Latin America recycled materials.

Scrap plastics are badly affected by the low-cost prime and recycled pellet prices. More offers are available, but recyclers are cautiously pessimistic, with their stocks at maximum levels. Some sorted mixed rigid plastics, agricultural plastics, and printed post-industry film have seen selling at zero FOB. With the US still having the most expensive shipping rate to Asia, all these plastic scrap netback prices are over $200 per ton, which is too costly if their pellet selling price is only $600 per ton. More offers are posted on different media platforms, mostly mismatches in prices. With the current challenges of capacities and the slow economy, nobody can see the recycling industry can recover from the crisis right now.

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