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Recycled product pricing pretty much held its own over the last year. Despite some new laws and some surprise market delays, recyclers still felt optimistic going into this year.

Perhaps the biggest story in 2013 was The Green Fence. That is the Chinese policy that went into effect in February, strictly enforcing regulations on importing dirty scrap materials—from the U.S. and elsewhere. It led to a significant drop in imports of plastic waste and even put some U.S. recyclers out of ����ý, at least temporarily. Recent crackdowns have required Chinese companies to import only those recycled materials that have gone through some kind of processing. It's no longer enough for waste just to be clean and sorted, industry sources say. They report that some municipal recycling facilities (MRFs) are responding to the Green Fence by trying to clean up waste with limited technical capabilities. Since the waste quality is still inferior, the MRFs are getting a lower domestic price for their waste. Industry sources say some lower-quality clear RPET flake has been offered for as little as 53¢/lb, below the more typical price range of 55-56¢/lb (see table below).

RPET DEMAND SURVIVES CHINESE SLUMP
While the Asian market was soft in last quarter, PET flake prices have been pretty stable over the course of 2013. Today, Chinese are still buying but the market is mostly domestic, one recycler said. The U.S. domestic price is a couple of cents higher than the Chinese price (they used to match). Also, Mexico is dumping a lot of washed flake in California, one source said.

While January is usually a slow month, recyclers expect RPET prices to rise over the year, at least on the West Coast, with the return of California state incentive programs to use recycle. “People will be fighting over the bales,” one West Coast source predicted.

R-HDPE DEMAND PICKS UP
Recycled HDPE experienced an unpredictable year, with a strong first quarter, and two dead quarters after that. However, since July, momentum has been building. HDPE pipe has been driving the market, though seasonal construction demand picked up about three months later than recyclers had expected.

According to one recycler, “The mixed-color market had softened quite a bit over the summer with the pipe industry not being able to lay pipe because of all the rain. Now the pipe market picked up again and there is a little more supply.”

The mixed color market HDPE is still a bit soft. Major pipe maker ADS now has two recycling plants of its own and has switched from buying pellets to buying bales. One recycler reports that colored and natural bale pricing grew very close in the spring. “Then it got to be the widest delta—22¢/lb—we’ve ever seen. Part of that was excess supply ADS was not taking and that wasn’t going to China either.

“We expected things to fall off by December, but a week and a half before Christmas, demand still looked strong. Material now is hard to come buy. However, we are now facing cold weather, snow and ice, so we will see what happens. Virgin prices seem to be holding and that affects recycle prices.”

Overall, recyclers predict that 2014 will be a stronger year for HDPE than 2013.