Europe R-PET bottle prices continue to trade at record highs

12 July 2010 23:59  [Source: ICIS news]

LONDON (ICIS news)--European prices of recycled polyethylene terephthalate (R-PET) bottles have extended their record highs this week amid ongoing tight supply and strong downstream demand, buyers and sellers said on Monday.

“Supply is the same old story: it’s easing a little on the [hotter] weather, but demand is very strong,” said a bottle buyer.

R-PET bottle prices have become increasingly varied according to region, with the highest prices reported in Italy and Germany, where material was in shortest supply.

Colourless bottle prices rose by €50/tonne ($63/tonne) from last week to €450-600/tonne FD (free delivered) NWE (northwest Europe), with prices at the top end of the range found in Italy.

But sources said that high R-PET prices in Italy were pulling up prices in other regions, because producers outside Italy could ship product to that country to realise higher margins.

At the top end of the range, prices of mixed-coloured bottles increased by €120/tonne from last week to €300-500/tonne FD NWE.

The highest prices of mixed-coloured bottles were also seen in Italy, where some suppliers were pricing material at levels on par with colourless bottles due to renewed demand from the downstream flake sector.

Outside of Italy, some sources confirmed prices of mixed-coloured bottles at €500/tonne, although a number of market players said prices peaked around €400/tonne.

“The Italians are buying all over Europe,” said a buyer.

Some sources said a substantial quantity of material was still heading to Asia, where the strong US dollar against the euro was making European material attractive.

There were also some sources who reported prices of colourless bottles as low as €360/tonne, but this could not be widely confirmed.

The tight supply of bottles was said to be improving due to warmer weather across much of Europe. But increased supply was counterbalanced by more buying interest and the need to restock.

Opinions were divided on how long the tight supply of bottles would last, which was restricting availability through the rest of the R-PET chain.

“There will be more bottle on the warmer weather, but companies’ hunger for bottles is very high,” said a bottle buyer.

Some sources said the market was structurally short due to increased interest in corporate social responsibility initiatives at major companies, which has fuelled a spike in demand, with R-PET availability to remain low until new capacity was brought on line.

Other sources argued that supply pressures would ease in the summer months because of the traditional holiday lull in demand.

Still other market players said that the need to refill inventories would keep the market short until at least October and possibly the end of the year.

The R-PET market has been in tight supply since the fourth quarter of 2009 because of low collection rates at post-consumer recycling facilities.

ICIS began keeping pricing records for R-PET on 19 June 2006.

($1 = €0.79)

For more on PET visit ICIS chemical intelligence
To discuss issues facing the chemical industry go to ICIS connect


By: Mark Victory
+44 208 652 3214



AddThis Social Bookmark Button

For the latest chemical news, data and analysis that directly impacts your business sign up for a free trial to ICIS news - the breaking online news service for the global chemical industry.

Get the facts and analysis behind the headlines from our market leading weekly magazine: sign up to a free trial to ICIS Chemical Business.

Printer Friendly