WPC 2026: US conversion costs twice as high as Asia in turning PET bottles into flake

This content is part of a series exploring key themes from the World Petrochemical Conference by S&P Global being held in Houston from March 23-27.

If the global recycled polyethylene terephthalate sector faces competitive challenges compared to virgin material, in the US, the lower post-consumer bottle collection rate and higher processing costs put even more pressure on the market, said Alasdair Carmichael, director of the National Association for PET Container Resources, at the WPC March 26.

He commented that the PET recycling rate in the US is 30%, "which is very poor" compared to other countries.

Luke Milner, associate editorial director at S&P Global Energy Platts, agreed that the post-consumer bottle collection rate in the US is low, noting it is lower than in Mexico and Brazil.

Carmichael also discussed the competitiveness issues of recycled material versus virgin. "What kills competitiveness in the US today is the cost of the process to turn the bottle into flake," he said, adding that while in the US this cost is 30-45 cents/lb, in Asia it is 9-20 cents/lb.

Besides the higher cost, recycled PET has faced competition from cheaper virgin material, the experts said, at least until the Middle East war started, which has shifted the dynamic.

"With what's happening now with oil prices, the price of virgin PET is rising up to 10 cents/lb," Carmichael said. With this, "RPET may become cheaper than VPET, something we haven't seen in recent years. But let's see how long this lasts."

Milner highlighted that financial realities weigh more in the RPET market than consumer awareness, industry commitments, and legislation.

Fiber market challenges

Carmichael mentioned that a sharp decline in recycled PET use in the fiber industry is also affecting the market.

He said that in 2017, a large portion of collected bottles was used to make fibers, but since then, this share has systematically decreased and currently, the bottle market represents the largest share of PET collected for recycling, at 62%.

"We anticipated this growth in the bottle-to-bottle market, but not this drop in the fiber market," Carmichael said.

Competition with virgin material was also discussed for the nylon market. Turner Plunket, chief operating officer of NylaNova, commented on the technique that transforms post-consumer nylon 6 products into its upstream product, caprolactam.

"The market price is $2,000/mt, which is equal to the price of virgin caprolactam," he said, adding that "the idea is to have a market cost competitive with virgin caprolactam."