- Natural supply generation heard shrinking
- Softening virgin prices creating downward pressure
The US recycled high-density polyethylene markets were seen stable on the day Nov. 24, as sources noted expectations of continued downward price trends despite strong demand.
S&P Global Platts assessed natural post-consumer HDPE bales in the Midwest spot market stable on the day at 80 cents/lb, above offers heard in the high 70s cents/lb range and purchase prices talked closer to 80 cents/lb.
Downstream recycled natural HDPE pellets for blowmolding applications were also seen flat on the day at 138 cents/lb, maintaining market structure amid a lack of fresh indications received.
Sources said supply of natural HDPE material, commonly used in milk jugs, was becoming increasingly difficult to secure nationwide as consumers switch to non-plastic milk cartons.
Despite shrinking supply availability, post-consumer HDPE prices are expected to continue facing downward price pressure amid softening virgin markets.
"There is more than ample demand," said a Midwest recycler. "But with virgin prices dropping, there is a concerted effort to prevent such wide differentials."
HDPE blow molding was assessed $66 lower at $1,587-$1,609/mt FAS Houston (72-73 cents/lb) Nov. 24. Rail car pricing for HDPE blow molding was talked at 69 cents/lb and up for the period.
Supply availability of prime resin is seen increasing with new capacity startups in Q4 2021 and 1H 2022, which market participants expect to extend the gradual retreat in prices from record highs.
The subsequent downward trend in recycled HDPE pricing is expected to continue until early spring when seasonal demand from the agricultural and construction sectors picks up again.