European R-PET prices generally seen stable
Most participants in the European recycled polyethylene terephthalate (R-PET) market are expecting spot prices to remain stable in September. This is because expected increases in vigin Polyethylene terephthalate (PET) prices are being offset by higher availability of post consumer bottles and an anticipated reduction in post-consumer bottle prices.
Post-consumer bottle collection rates tend to rise in the summer months with the warmer weather.
Nevertheless, the peak bottle-collecting season is now drawing to an end.
On the whole, German bottle and flake buyers are expecting small price reductions while buyers in other NWE countries, and in Greece, are expecting or have received roll-overs.
A German flake producer expects a slight decrease of €10-15/tonne for clear flake in September, citing high post-cosumer bottle availability. Nevertheless, it expects food-grade pellet prices to remain stable as increased post-consumer bottle supply is counterbalanced by strong demand for food grade material.
Even though the general expectation is for upstream virgin PET prices to rise, the combined impact of high availability of post-consumer bottles and flat demand are keeping R-PET prices stable. Virgin PET directly competes with R-PET in end-use markets such as fibre.
A flake buyer in Eastern Europe, however, noted that prices for clear and mixed colour flakes are up €10-20/tonne from August, reflecting a slight rise in virgin PET prices and strong demand from the packaging sector. The source expects R-PET pricing in Eastern Europe to continue to increase over the next few months as availability of post-consumer recycled material reduces after the summer and in anticipation of rising virgin PET pricing.
Virgin PET supply in Europe is tighter than expected due to production problems and a recent spate of good demand. September price ideas are bullish because of this, combined with limited competition from imports and expectations of higher production costs.
Covering editor: Iain Packham
($1 = €0.76)
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