July 07, 2021

Global Recycled Polyester Market Snapshot

The three main application areas for polyester are fibre, bottle and film.  Polyester (PET) bottles are eminently recyclable, while fibre and film are not.  Converting bottle scrap back into bottles however poses much greater technical challenges to compared to re-use in other applications, and most bottle scrap globally is used to produce rPET fibre.   

Reprocessing bottle scrap back into bottles is challenging due to the polymer viscosity, clarity, and purity requirements.  PET bottles need to maintain the required levels of carbon dioxide in beverages for a six-month shelf life and need to be visually clear and have no odour or contaminants which can migrate into the contents.  This creates higher costs than virgin material and is only workable where consumers are prepared to pay the required price premium. 

PET fibre is difficult to recycle as the post-consumer waste is generally garments which contain other polymers and natural materials, and items such as zips which need to be manually removed.  The PET fibre itself will also contain pigments and other products such as UV stabilizers.  PET films tend to be small items, often layered, and often contaminated with food etc and opportunities for recycling are generally limited to commercial sources of release films. 

The rPET value chain is complex, involving the public, state and private sector actors, and local and global organizations.  High recycle rates depend on all elements working together.  The public needs to be educated and engaged in recycling or their waste will not be adequately sorted, and a higher proportion of plastic packaging will be lost directly into the environment as litter.  Municipal collection and sorting schemes also need to be in place, and the economic hardship in some regions in recent years has led to funding being withdrawn for some municipal collection schemes, notably in parts of the United States. 

The supply side is evolving rapidly along with demand trends.  The rPET market was initially a sub-prime quality sector mainly of products such as strapping, produced by small independent companies.  The market evolved most significantly in volume terms in the fibre sector, both as small dedicated rPET producers and diversification by conventional fibre producers.  The relentless increase in competitive pressure from ever larger and more integrated Chinese virgin fibre producers forced many fibre producers in more developed regions to idle their polymerisation plants and convert to rPET fibre production, normally aided by local PET scrap availability.   

Some of the rPET fibre producers in China produce several hundred thousand tons of fibre per year, and collectively their output reached well over six million tons per year over 2016-2017.  The level of investment in new capacity greatly exceeded the availability of bottle scrap however, and operating rates were already restricted before the introduction of the “National Sword” legislation which stopped the import of PET waste in 2018.  Published numbers for this import were over two million tons, and the actual quantity was reckoned to be closer to four million tons.  With domestic PET recovery rates already high, there was no prospect of replacing the lost imports of PET scrap with locally-sourced bales, and many producers instead opted to relocate machinery to countries such as Vietnam, Malaysia and Myanmar where there was both local PET scrap available and the option of importing from other countries.  There was however a public backlash against the pollution problems associated with unregulated imports of plastic waste in Malaysia, leading to an import ban similar to that earlier imposed in China.  Some companies developed flaking capacity – also mostly in southeast Asia – to serve consumers in China, effectively circumventing the ban on raw PET waste imports into China by instead selling clean flake.  Imports of flake into China peaked at over 600 000 tons in 2019, but dropped sharply in 2020 due to COVID effects and the waste plastic import ban in Malaysia. 

The current rPET fibre industry is therefore diverse, with some very large producers providing contractual volumes to multinational apparel brands, and a very large number of smaller producers manufacturing a wide range of products and qualities. Consumers demand a steep increase in the provision of filament which they can drop into their existing product ranges to achieve their stated recycle content objectives.  This higher-value use progressively draws PET scrap away from staple fibre, which is therefore increasingly produced from virgin materials.  The rPET fibre market is thus undergoing a reversal of the kind which has already occurred in some Western PET resin markets, where rPET shifts from the discounted, lower quality end of the market to the premium end.  

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Market Insights: Recycled Polyester - 2021 provides analysis and forecast to 2035 of the global recycled polyester market, including supply by mechanical method and chemical processses (glycolysis and methanolysis/hydrolysis) and demand in bottle, fibre and others.     

The report includes discussion regarding key market drivers and constraints, as well as demand analysis for nine regions: North America, South America, Western Europe, Central Europe, Eastern Europe, Middle East, Africa, Asia Pacific, and China.  Analysis also includes the competitive landscape, capacity listing and cost competitiveness along with a snapshot of latest pricing trends by region and price forecasts to 2035.

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