Thai R-PET prices could be unaffected by upcoming plastic waste import ban

Thailand's decision to ban plastic waste imports from Jan. 1, 2025, is expected to have limited impact on recycled polyethylene terephthalate prices and raw material costs in the country, market participants said Dec. 20.

The Department of Foreign Trade announced the ban Dec. 17, following cabinet approval Dec. 3, and publication in the official journal of Thailand, Royal Gazette, as the country aims to reduce reliance on imported raw materials and minimize environmental impact.

The new regulation also mandates agencies to promote domestic plastic waste recycling in accordance with Thailand's BCG economy model (bio-circular-green economy), aligning with measures announced in February 2023.

The proposed amendment to Item No. 39.15 of Thailand's tariff schedule by the Ministry of Natural Resources and Environment will ban plastic scrap imports, replacing the previous system that permitted imports with recycling permits.

Plastic recyclers holding import permits must complete shipments into Thailand by Dec. 31, 2024.

Since February 2023, plastic waste imports have been restricted to 14 recycling plants located in Thailand's tax-free zone, which have a combined capacity of about 372,000 mt. In 2024, the permitted import volume was half this capacity.

"It is a very closed market for waste imports, not large enough to significantly affect PET bale pricing," said a Thai recycler, adding that seasonality and rainfall have a greater impact on bale availability.

The impact in the Southeast Asian region is also expected to be limited as neighboring markets are not reliant on Thailand for raw material feedstock.

PET bottle bale feedstock costs in Southeast Asia have dropped in recent weeks due to slowing recycled PET consumption, owing to reduced export demand as a result of intense competition with falling virgin PET prices and the upcoming year-end holidays.

Platts, part of S&P Global Commodity Insights, assessed FOB Southeast Asia recycled PET clear flakes and premium-grade flakes respectively at $865/mt and $925/mt, on Dec. 19, while food-grade pellets were assessed at $1,265/mt.

Platts assessed FOB Southeast Asia bottle-grade PET at $865/mt on Dec. 19.