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by Jerry Powell
April/May 2008
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| The rising value of prime resin to record highs has caused a parallel surge in the prices paid for processed scrap plastics. |
Plastics recycling in North America has undergone profound change in this decade. Current market and policy pressures are forcing the polymer recovery industry to adopt new practices and invest in new technologies. The rising globalization of the overall plastics supply chain is also resulting in significant alterations to how plastics are recycled in the United States and Canada.
After a long period of little social and political action from the mid-1990s to the middle of this decade, plastics producers, users and reclaimers are now seeing a resurgence of activity. Several states this year may require plastics beverage containers to carry a deposit value as a way of boosting bottle recovery. Hundreds of communities have considered bans on the use of plastic retail bags or polystyrene fast food packaging. Wal-Mart has adopted a packaging scorecard to provide its buyers with an environmental evaluation tool to be used making purchasing decisions. Included in the scorecard is a metric for recycled content.
At the same time, plastic converters continue to develop new and innovative products. Although the majority of the new thermoplastic items can be recycled, a growing number now contain new additives and fillers that can create recycling havoc. Concerted efforts are underway by a variety of parties, including the Association of Post-Consumer Plastic Recyclers, to have product developers seek technical advice from the reclamation industry before a new, nonrecyclable plastic item is put on the shelf.
The recent move in the marketplace toward bioplastics is gathering the attention of the plastics recycling industry. Some bioplastics producers, such as NatureWorks LLC, are aggressively bringing out new bioplastics products. NatureWorks makes polylactic acid (PLA) resin for use in a variety of applications. Many observers agree that PLA and other forms of bioplastics can have a role in the market, especially for items such as compost and garbage bags, or fast-food packaging, where degradability is an asset. These parties, however, are concerned about the potential negative effects of such resins on recycling, as degradable resins cannot be recycled along with hydrocarbon-based polymers.
In this time when the plastics’ political marketplace is changing and when new products are emerging, the reclamation industry is going through a retrenchment period. Few new players are entering the industry, and several large players, such as Wellman, Inc., the PET reclaimer, are exiting the business. That said, considerable investment is being made by existing firms. A survey we recently completed of U.S. and Canadian HDPE and PET reclaimers found that 80 percent had budgeted for a plant upgrade or expansion in 2008.
And new technologies are being introduced. The rising value of prime resin to record highs has caused a parallel surge in the prices paid for processed scrap plastics. This has attracted new technology developers into the fold. For instance, new investments are being made to develop ways to clean and process film plastics recovered from agricultural fields. A second area of R&D investment focuses on improving the methods used to convert food-grade plastics, such as plastic beverage bottles, back into clean food-grade plastic. Coca-Cola, for example, has recently invested in a 100-million-pound-per-year bottles-to-bottles recycling plant in Spartanburg, SC, USA.
We are also seeing new interest in developing ways to make fuels from mixed plastics. At least a dozen entrepreneurial ventures have been established to try to successfully and profitably convert plastics to oil or gas.
These North American policy, market and technology developments are being influenced, however, by the most important trend and future issue in plastics recycling: the industry’s globalization.
The polymer recovery industry is following its prime resin compatriots and is moving offshore. Nearly all of the increase in the sales of recovered plastics in this decade is explained by the growth in Chinese imports of U.S. recyclable plastics. For example, exports from the United States rose last year by 30 percent, while North American consumption of recycled flake and pellets was flat. This is similar to the prime resin industry, where sales in North America were barely up last year, while exports jumped 12 percent.
This trend is expected to continue. More than 700 million people in developing countries will become middle-class in the next eight years. The residents will want new things made from plastics. To feed this massive new demand, the post-industrial and post-consumer plastic discards from North America and Europe will be sought. This market trend has generated rising consternation among some in the plastics recycling industry. In Europe, many plastics reclamation executives are seeking regulatory relief. They are calling on the European Union to adopt exporting regulations which essentially guarantee that plastics recovered in Europe are used in Europe. Some American scrap plastic processors would like to see the same rule approved here.
Jerry Powell publishes Plastics Recycling Update, a monthly periodical and weekly e-newsletter focusing on polymer recovery efforts. In addition, his firm sponsors the annual Plastics Recycling Conference each February. Powell can be reached at jpowell@resource-recycling.com, www.resource-recycling.com.
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