PLASTICS RECYCLING
WRAP: Chinese market for recovered plastics from the UK hit by economic crisis / Signs of slow improvement
A recent survey and market analysis by The Waste & Resources Action Programme (WRAP, Banbury / UK; www.wrap.org.uk) shows that the Chinese market for recovered plastics from the UK has been greatly impacted by the economic crisis, although there are signs of improvement.
In its study “The Chinese markets for recovered paper and plastics,” WRAP shows that Chinese demand for recovered plastics plummeted from 48,000 t in September 2008 to 43,000 t in October and 23,000 t in November of the same year – less than half the demand in November 2007. This drop is largely attributed to a lack of demand in both domestic and export end-markets, with 90% of respondents to WRAP’s “China market sentiment survey” reporting a reduction in their profit margins from mid-2008 onward.
The fall in virgin raw material prices further worsened the situation, since the finished product no longer achieved the price the processors had set, leaving them with the option of either selling their products for less and risk incurring overall losses, or holding off on selling and risk facing cash flow problems.
However, WRAP also reported that the situation seems to be improving, with UK exports of recovered plastics regaining 66% in December 2008 compared to the preceding month. This assessment seems to be confirmed by a recent decision by the Chinese government to open its doors to more types of plastics waste. Since 1 August 2009, it has been possible to import ethylene, styrene, PVC, PET bottles and CD-ROM scraps – see Plasteurope.com of 02.09.2009.
WRAP’s market sentiment survey found that most respondents (86%) used UK recovered plastics to make pellets, which in turn are used for a range of applications. Recovered PET bottles, for example, tend to be used for fibre applications such as fillings for anoraks, sleeping bags, toys, upholstery as well as in insulation, rope and automobile lining. Film grades were reprocessed by 51% of respondents, 33% focused on PET bottles and 36% on polypropylene. The poll found that most Chinese reprocessors prefer to source material from abroad, as it is perceived to be of a higher standard than that procured from the domestic market.
China is the world’s largest importer of recovered plastics, with the UK alone exporting some 517,000 t in 2008. Due to its rapid growth over the last three decades, Chinese thirst for raw materials has risen sharply. Recyclable goods are in high demand since they constitute an additional resource and tend to be cheaper than oil and plastic resins. China’s imports of recovered plastics skyrocketed from 200,000 t in the mid-1990s to almost 7m t in 2007, reflecting a parallel jump in demand.
e-Service:
WRAP market situation report “The Chinese markets for recovered paper and plastics” as a PDF document (1,24 MB)
In its study “The Chinese markets for recovered paper and plastics,” WRAP shows that Chinese demand for recovered plastics plummeted from 48,000 t in September 2008 to 43,000 t in October and 23,000 t in November of the same year – less than half the demand in November 2007. This drop is largely attributed to a lack of demand in both domestic and export end-markets, with 90% of respondents to WRAP’s “China market sentiment survey” reporting a reduction in their profit margins from mid-2008 onward.
The fall in virgin raw material prices further worsened the situation, since the finished product no longer achieved the price the processors had set, leaving them with the option of either selling their products for less and risk incurring overall losses, or holding off on selling and risk facing cash flow problems.
However, WRAP also reported that the situation seems to be improving, with UK exports of recovered plastics regaining 66% in December 2008 compared to the preceding month. This assessment seems to be confirmed by a recent decision by the Chinese government to open its doors to more types of plastics waste. Since 1 August 2009, it has been possible to import ethylene, styrene, PVC, PET bottles and CD-ROM scraps – see Plasteurope.com of 02.09.2009.
WRAP’s market sentiment survey found that most respondents (86%) used UK recovered plastics to make pellets, which in turn are used for a range of applications. Recovered PET bottles, for example, tend to be used for fibre applications such as fillings for anoraks, sleeping bags, toys, upholstery as well as in insulation, rope and automobile lining. Film grades were reprocessed by 51% of respondents, 33% focused on PET bottles and 36% on polypropylene. The poll found that most Chinese reprocessors prefer to source material from abroad, as it is perceived to be of a higher standard than that procured from the domestic market.
China is the world’s largest importer of recovered plastics, with the UK alone exporting some 517,000 t in 2008. Due to its rapid growth over the last three decades, Chinese thirst for raw materials has risen sharply. Recyclable goods are in high demand since they constitute an additional resource and tend to be cheaper than oil and plastic resins. China’s imports of recovered plastics skyrocketed from 200,000 t in the mid-1990s to almost 7m t in 2007, reflecting a parallel jump in demand.
e-Service:
WRAP market situation report “The Chinese markets for recovered paper and plastics” as a PDF document (1,24 MB)
15.09.2009 Plasteurope.com [214335]
Published on 15.09.2009