Asia R-PET under pressure from oversupply as China restricts imports

SINGAPORE (ICIS)–Recycled polyethylene terephthalate (R-PET) prices in Asia are under pressure from oversupply, stemming from China’s decision to ban imports of waste plastics by the end of the year.

Regional prices have declined by more than $100/tonne from four weeks ago and are expected to continue falling.

In the week ending 19 September, hot-washed clear/white R-PET prices were assessed at $600-630/tonne CFR (cost and freight) China, according to ICIS data.

China, the main market for R-PET from southeast Asia, has started to withdraw import quotas on waste plastics, industry sources said.

Cargoes of southeast Asian origin that are typically exported to China may be making their way into India, they said.

India does not normally import PET flakes, but if they’re cheaper, then people may start buying, a south Asian producer said.

An offer for southeast Asian hot washed clear/white R-PET flakes to the Indian market was heard at as low as $500/tonne CFR India, down by more than $100/tonne compared with prices in the Chinese market. But no deals were confirmed at that price, market sources said.

An Indonesia-based producer has raised concerns that China’s ban on plastic waste imports might have a dire impact on smaller producers in Indonesia.

China informed the World Trade Organisation (WTO) on 18 July that it plans to restrict the import of 24 kinds of solid waste including plastic, paper and textile materials, for environmental reasons.

Uncertainties hound the Chinese R-PET import market since the announcement and market participants await further clarifications on the classification of banned waste plastics.

Focus article by Ruth Loh Xiu

Pictured above: Mineral water bottles made of polyethylene terephthalate (PET). (Source: imageBROKER/REX/Shutterstock)