OUTLOOK '19: Europe R-PET market certain on demand, unclear on feedstock supply increase

Source: ICIS News


LONDON (ICIS)--Not many doubt that the European recycled polyethylene terephthalate (R-PET) market will experience strong demand once more in 2019.

The question is whether or not any new legislation could drive further change for recycling by lifting the feedstock ceiling from recyclers.

After all, although there is continued market talk of R-PET capacity expanding in 2019, the difficulty many recyclers face is in sourcing upstream post-consumer polyethylene terephthalate (PET) bottles.

A few participants have said this could change if populous European countries such as the UK, France and Spain introduce new collection schemes.

“In general, I think it will be a tight year and not a short year. Capacity expansions are all good and fair, but what about the feedstock? I don’t see any substantial increase in [post-consumer PET] collection rates,” said a buyer.

“For all the capacity expansions there is a shift on who is using the feedstock, but I do not see more [R-PET] flake being available on the market. So, from that perspective, we are pretty worried.”


Governmental and social pressures that began with the EU’s circular economy strategy in January 2018 were the source of higher demand for recycled content in the first place.

From January 2019, Germany will also enact legislation for all firms that bring packaged goods into the market.

It will prescribe that these companies have to ensure that a higher rate of recycling than previously set is achieved for related packaging materials.

This only contributes to participants' expectations of sustained strong consumption in 2019.

Following a general trend to boost plastic recycling in 2018, there is even market talk of brand owners having to secure food grade R-PET pellets volumes for years ahead.

“There is a lot of demand out there, and the supply isn't something that you can just hit the accelerator, and go a little faster. All the recyclers are running full speed,” said a consumer.

Although not all agree, many in the industry pinpoint deposit schemes as the necessary move some nations must take to increase feedstock supply.

They argue it would increase the quantity and quality of post-consumer PET bottles to a point that R-PET production could meet strong demand.

Various governments are discussing the possibility of adopting these schemes, but there are R-PET participants that question how quickly states could install such collection processes.

Furthermore, until these developments are enacted, sources believe that tightness will reign for recycled product as production will be limited by low post-consumer PET bottles availability.

“Even if there is more product in the market, it will not be enough. Not next year … The problem for us is [that] we really need appropriate [post-consumer PET] bottle collection," said a recycler.

"The UK's deposit plans are going to help. But, when are they going to kick in?

“The same is true for France. Now, if you just take these two countries, this will then give enough bottles to balance the market. But before [this happens] there will be tremendous demand,” the recycler added.


In the face of such conditions, the market is split on the likelihood of buyers switching to competing product virgin PET where and when they can.

Some consumers need to meet marketing targets regarding the quantity of recycled content in their packaging.

However, there are sources that have argued that costs are still more important to purchasers than sustainability.

The fact that such a debate has opened up on the products' relationship shows the evolution that R-PET has undertaken.

But, in the end, it will be relatively insignificant as most in the market expect that conditions will favour R-PET sellers in 2019.

“I think the next three years are going to be very competitive. Who has access to the volumes is king,” said a post-consumer PET bottles re-seller.


R-PET can be used in carpet and apparel manufacturing and in the automotive industry. The product is also used for food packaging, including beverage bottles.

Picture source: REX/Shutterstock

Focus article by Pavle Popovic