Recycled PET shortage serious, growing
By Joe Truini
WASTE NEWS
AKRON, OHIO (April 27, 4:30 p.m. EDT) –
Recyclers and recycling advocates could
be missing a golden opportunity to
improve sagging plastic bottle recycling
rates significantly.
Since humans began roaming the earth,
demand often has dictated supply.
Basically, if someone wants something,
there is someone else willing to provide it
— for a price.
But demand for recycled PET containers
from carpet makers, beverage companies,
strapping manufacturers and overseas
buyers is outpacing supply.
Recovered PET prices have reached an
average of about 25 cents per pound, but that
premium still hasn’t been enough to increase
container recovery.
“There’s plenty of bottles to go around, but
they’re just not being collected,” Cavin said.
“It’s terrible right now. Nobody sees any relief
in sight.”
“We’re playing musical chairs right now in the
PET recycling industry, with 10 players and
seven chairs,” said Phil Cavin, national
procurement director for carpet maker
Mohawk Industries Inc. “Everyone right now is
just scrambling to get material, and prices are
through the roof.”
In 2003, U.S. recyclers produced 667 million
pounds of clean flake from recovered postconsumer PET bottles, exporting 255 million
pounds of that, according to NAPCOR.
Mohawk, based in Calhoun, Ga., is one of the
nation’s largest PET recyclers. The company
uses recovered material in its carpeting and is
a major supplier of recycled PET resin.
Dropping fast
Despite the strong market and increased
demand, the 2003 recovery rate for plastic
soda, water and other PET bottles fell for the
eighth consecutive year since 1995. That
year, the United States recovered 39.7
percent. But that rate sunk to 19.6 percent in
2003, according to the National Association
for PET Container Resources in Charlotte,
N.C.
That same year, U.S. manufacturers
consumed 552 million pounds of recovered
PET. Fiber product manufacturers, which
include carpet makers, led the pack, using
296 million pounds. Food and beverage
bottle manufacturers consumed 106 million
pounds, and the strapping industry 77 million
pounds. Sheet and film producers, nonfood
bottle makers and engineered resin producers
used 32 million, 24 million and 10 million
pounds, respectively. Some 7 million pounds
were consumed by other sources.
It is not a new issue, said Mike Shedler,
NAPCOR vice president of technology.
“We’ve had a demand imbalance for quite
some time,” he said. “There have been
meetings and committees and studies and
everything else that people have talked about
over the years in terms of how we can
address supply issues. Not a whole lot,
though, has happened.”
“We could essentially double the demand for
strapping in the next 12 months,” he said.
“That would put the strapping segment, in
terms of [recovered PET] content, very close
to where the carpet industry is today.”
Stuck in the middle
Many people agree that container-deposit
laws, or bottle bills, are effective in recovering
PET bottles, but stakeholders are split on their
support, said Pat Franklin, executive director
of the Container Recycling Institute in
Arlington, Va. Beverage manufacturers, the
grocery industry and retailers oppose bottle
bills.
Recyclers are stuck in the middle, Franklin
said. Major beverage companies are their
customers, whether buying processed
material from recyclers or selling them
recovered bottles, she said.
“It’s like they’ve got a gag order,” Franklin
said.
Recycling advocates praise the effectiveness
of bottle bills. The 10 states that have had
deposit laws running for some time — Hawaii,
the most recent state to pass deposit
legislation, just started its program this year —
collect about three of every four bottles
consumed, she said. Recovery rates can
reach higher than 80 percent in those states.
“You’re looking at single-digit recycling rates
in nonbottle-bill states,” she said.
No consensus
And over the past six to nine months, virgin
PET price increases have created even more
demand for alternative raw materials,
including recovered PET, said Shedler of
NAPCOR.
“There’s no question we need more supply out
there,” he said. “The issue is that no one can
agree on just how to do it.”
And the incredibly high demand for strapping,
which is used to secure a range of products
such as baled materials, could add to the
need for more PET, Shedler said. Strapping
manufacturers are adding capacity to fill
orders, as most of them are sold out of
product.
You just might get what you wish for
In 2000, recycling advocacy groups led by the
GrassRoots Recycling Network started
pressuring Coca-Cola Co. and PepsiCo Inc. to
use more recycled PET.
That year, Coke officials agreed to start using
10 percent recycled content in billions of the
company’s bottles.
In 2002, PepsiCo officials outlined a goal to
use 10 percent recycled content in their firm’s
containers.
But those environmental community victories
are putting recyclers and processors on the
spot to come up with enough material for
everybody.
Coke and Pepsi together are consuming in the
neighborhood of an additional 200 million
pounds of recovered PET bottles or so per
year, according to recycling industry
estimates.
The additional demand has led to shortages of
100 million to 200 million pounds per year,
according to Cavin.
“That’s getting many in the industry upset
because that’s lessening the quantity that’s
out there on the market,” said Rob Krebs, a
spokesman for the American Plastics Council
in Arlington. “It’s a valued commodity. It’s
needed and desired.”
Beverage makers have not had recycled PET
shortage issues, though the industry is
pursuing ways to increase the amount of
material recovered, said Preston Read, vice
president of environmental affairs for the
American Beverage Association in
Washington.
“Our members are getting what they need,” he
said. “We’re not seeing anyone right now
saying, ‘I absolutely can’t satisfy my needs.’
“I think it’s become a bit more expensive for
people to satisfy their needs, but that’s the
nature of the market.”
Recovered-PET price hikes are likely to entice
commercial businesses to recycle more of
their waste material instead of throwing it
away, Shedler said. But that increase may be
only about 10 million pounds.
U.S. PET recyclers collected 841 million
pounds of bottles in 2003, the most of any
year including 1995, according to NAPCOR.
That is the most significant trend, Read said.
“There’s been so much growth in the use of
the package, and that has a direct bearing on
the rate,” he said.
Most likely, more material will be collected in
2004 and 2005, Shedler said.
“Will it keep pace with any increased
demand? No. Not going to happen,” he said.
Recyclers definitely can handle more material,
as many PET processors are operating at
about 50 percent capacity, Krebs said.
NAPCOR’s 2003 data shows the 14 U.S. PET
processing plants had total capacity of 877
million pounds and ran at 71 percent capacity.
To get more PET bottles to those recyclers,
APC promotes an all-bottle recycling program
that encourages communities to allow
residents to put plastic bottles of all types into
their recycling bins. The goal is to make it
easier for consumers to recycle.
Processors then sort the bottles to separate
the grades. The increased material collected
offsets the additional costs associated with the
sorting, according to APC.
“It brings home to the consumer that there are
bottles there that are not being recycled,”
APC’s Krebs said.
“There’s a tremendous amount of education
that needs to happen there.”
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