1999 Report on Post Consumer PET Container Recycling Activity
National Association for PET Container Resources (NAPCOR)
INTRODUCTION
This report is designed to give the reader an overview of the U.S. PET Bottle Industry as well as detailed information with respect to the recycling of post consumer PET bottles. Information contained in this report was obtained through surveys conducted by Robert A. Bennett, Ph.D., Moore Recycling Associates, The Association of Post Consumer Plastic Recyclers (APR), R.W. Beck, Container Consulting, Inc., as well as data generated internally by The National Association for PET Container Resources (NAPCOR). In order to present as accurate a picture of these activities as possible, additional data and information was also obtained through discussions with individual collectors, intermediate processors, reclaimers, converters, brokers, exporters, end users, public recycling officials and key industry members.
PET BOTTLES AVAILABLE FOR COLLECTION
After nine years of sustained double-digit growth, additional market penetration of PET bottles and jars on U.S. shelves did not exceed 9% in 1999. This was largely due to the market stagnation of PET used in carbonated soft drink (CSD) containers. While 20 oz. packaging saw growth of about 9% and the 24 oz. bottle, in it’s second year, saw growth in excess of 30%, it came at the expense of ½, 1 and 3 liter sizes. Two-liter sales, long the mainstay of the industry were flat. Overall growth in pounds used for these applications was less than 2%.
Growth in custom containers (applications other than carbonated soft drinks)
continued strong with bottles used for still water posting an astounding growth
of 30% over 1998. Juice and juice
drinks also continued a strong growth rate of 16% while isotonic drink
applications finally started to taper off from previous years explosive growth
with a 10% increase. While data is
not available, significant growth was also seen in 16 oz. milk bottles and wide
mouth, hot filled containers for processed foods.
For the first time, 1999 saw slightly more PET resin used in the manufacturing of custom containers than CSD bottles.
NAPCOR has determined that the total number of pounds of PET bottles and jars available for recycling in 1999 was 3.25 billion. This number reflects the total amount of PET bottle resin used by U.S. bottle manufacturers from U.S., foreign and recycled sources less scrap generated and not reused, exported bottles and performs and bottles less than 8 oz. in size. NAPCOR uses this number as the denominator in determining both recycling and utilization rates.
POST CONSUMER PET BOTTLE PURCHASES
The amount of post consumer PET bottles collected and sold in the U.S. increased to 771 million pounds (mmlbs) in 1999. The breakdown of buyers is as follows:
586 U.S. Reclaimers 183 Export Markets 2 Composite Applications 771 Total Amount of U.S. Material Sold (mmlbs)
The 183 mmlbs of post consumer
bottles exported includes 23 mmlbs going to
Canada, less than 1 million to Mexico, Korea, India and Indonesia and the
balance to China. Aggressive export
pricing and the inability of some U.S. reclaimers to compete led to the
single annual largest amount of post consumer bottles shipped out of the
country. This reversed a three-year
trend of decreasing exports and began to put extraordinary pressure on U.S.
reclaimers to compete for adequate supply. In
fact, the 20 U.S. reclaimers that purchased post consumer bottles at one time or
another during 1999, used an increased amount of alternate feedstocks
(strapping, sheet, film, etc.) in an effort to boost capacity utilization.
|
Post Consumer Bottles – Gross Weight Purchases (mmlbs.) |
1995 |
1996 |
1997 |
1998 |
1999 |
|
A. Purchased by U.S. Reclaimers + Other B. Purchased by Exporters |
605 170 |
549 148 |
580 111 |
656 89 |
588 183 |
| C. Total U.S. Material Recycled (A+B) |
775 |
697 |
691 |
745 |
771 |
|
|
|
|
|
|
|
| D. Post Consumer Bottle Imports |
46 |
87 |
66 |
101 |
60 |
|
|
|
|
|
|
|
| E. Total Bottles Used by U.S. Reclaimers (A+D) |
651 |
636 |
646 |
757 |
648 |
1999 GROSS RECYCLING RATE
Total U.S.
Bottles Collected and Sold for Recycling
771
mmlbs = 23.7%
Total U.S. Bottles Available for Recycling
3,250
|
Year |
Total U.S. RPET (MM lbs.) |
Bottles on U.S. Shelves (MM lbs.) |
Gross Recycling Rate |
|
1995 |
775 |
1,950 |
39.7% |
|
1996 |
697 |
2,198 |
31.7% |
|
1997 |
691 |
2,551 |
27.1% |
|
1998 |
745 |
3,006 |
24.8% |
|
1999 |
771 |
3,250 |
23.7% |
PET BOTTLE BALE MARKETS
The first three quarters of 1999 saw
a stagnant market pricewise for PET bottles
bales even as exporters began making inroads during the second quarter.
While demand was high especially for the vertically integrated reclaimers,
low prices for competing raw material (imports, off spec) kept bale prices from
moving upward. However, by the
fourth quarter, depleted inventories, virgin price increases and intense
export pressure combined to force increases for all bale grades, i.e. drop-off,
curbside, deposit.
Curbside PET Bale Prices Per Pound Picked Up At Seller’s Dock
|
1999 |
LOW |
HIGH |
|
1st Quarter |
$.05 |
$.10 |
|
2nd Quarter |
.05 |
.11 |
|
3rd Quarter |
.05 |
.11 |
|
4th Quarter |
.08 |
.18 |
RECLAMATION CAPACITY
At one
time or another, 20 plants produced clean PET flake from post consumer
bottles during 1999. One plant was
retired and another sold for utilization other than PET, leaving 18 plants
operating by year-end at a total gross in capacity of 890 mmlbs.
These plants consumed total feedstock including post consumer, pre
consumer, strapping and other materials of 717 mmlbs from which they produced 592
mmlbs of clean flake for a capacity utilization rate of 78%.
Of these plants, 7 were vertically integrated back to product (2 carpet,
2 strapping, 3 bottle) and now total over 50% of the available capacity,
accounting for about 60% of U.S. bottles processed last year.
This is up dramatically from an estimated 25% in 1997 and reflects the
ability of vertically integrated users to compete in what has become a global
market.
|
RPET Clean Flake Production Summary (MM lbs.) |
1995 |
1996 |
1997 |
1998 |
1999 |
| A.
RPET Produced from U.S. Bottles
B. RPET Produced from Imported Bottles |
496 38 |
438 70 |
486 55 |
513 75 |
457 47 |
|
A. Total Post Consumer Production Available for U.S. End Use Products (A+B) |
507 |
508 |
541 |
588 |
504 |
|
|
|
|
|
|
|
| D. RPET Clean Flake Equivalent Exported |
153 |
134 |
92 |
75 |
154 |
|
|
|
|
|
|
|
|
B. Total U.S. RPET Produced from U.S. Bottles + Exported Clean Flake Equivalent (A+D) |
622 |
572 |
578 |
588 |
611 |
UTILIZATION RATE
Clean Flake Produced from U.S. Post Consumer Bottles 457 mmlbs + Clean Flake Equivalent of U.S. Bottles Exported 154 mmlbs = 18.8% + Total U.S. Bottles Available for Recycling 3,250 mmlbs
|
Year |
Clean Flake Equivalent (MM lbs.) |
Bottles on U.S. Shelves (MM lbs.) |
Utilization Rates |
|
1995 |
622 |
1,950 |
31.9% |
|
1996 |
572 |
2,198 |
26.0% |
|
1997 |
578 |
2,551 |
22.7% |
|
1998 |
588 |
3,006 |
19.6% |
|
1999 |
611 |
3,250 |
18.8% |
1999 END USES
Sixty-three companies reported purchasing and converting RPET into intermediate raw materials or end products in 1999. Volumes were up slightly from 1998, a surprise given the decrease in the amount of material available from U.S. reclaimers. Much of the shortfall continued to be made up by Canadian and Mexican reclaimers, as well as the non-post consumer bottle feedstocks sourced by U.S. reclaimers.
While the strength of the dollar does allow foreign reclaimers to offer attractive pricing to U.S. converters, it is investment and expertise that has given U.S. markets the ability to use the widest range of PET recyclate in the world.
RPET Product Categories
|
RPET Used (mmlbs) |
||||
|
|
|
|
|
|
|
1996 |
1997 |
1998 |
1999 |
|
| Fiber |
292 |
320 |
415 |
417 |
| Sheet & Film |
69 |
71 |
89 |
68 |
| Strapping |
66 |
58 |
67 |
80 |
| Engineered Resin |
24 |
26 |
30 |
26 |
| Food & Beverage Bottles |
24 |
41 |
52 |
68 |
| Non-Food Bottles |
71 |
53 |
47 |
50 |
| Other |
1 |
1 |
7 |
9 |
| Total US Converter Consumption |
547 |
570 |
707 |
718 |
The percentage of each recycled PET end use category is shown in the following graph:
RPET End Use Products 1999
 |
1 Fiber 59% 2 Strapping 11% 3 Engineered Resins/Molding Compounds 4% 4 Food/Beverage Containers 9% 5 Sheet/Film 9% 6 Non-Food Containers 7% 7 Other 1% |
SUMMARY
Growth of PET resin use for bottle and jars slowed in 1999, reflecting a mature market for CSD applications. However, a plethora of new performance enhancing technologies were introduced which lay the foundation for future growth in PET packaging for beer, processed foods, juice and juice drinks, ready to drink tea and potentially smaller size CSD bottles. Increasing the collection of PET bottles remains the primary concern of all in the industry, while keeping the bottles collected in the U.S. is also of great concern to both reclaimers and end users who have made large investments in PET recycling. At least three expansions in reclamation capacity planned for 1999 were postponed due to uncertainty of supply. In addition, successful market introductions of containers using performance enhancing technologies and non-traditional colors further complicate the recycling picture. Efforts to recover PET bottles consumed away from home increased particularly at special events, stadiums and arenas, but much more is needed. The use of PET beer bottles at these venues could provide the critical mass to allow for better economics and more recycling. Publicly initiated programs such as curbside and drop-off need to be reinvigorated for increased consumer education and recycling promotions to work effectively toward collecting more bottles. The data in this report shows that significant shortfall exists between RPET and demand. This shortfall is understated as all product categories are capable of using additional supply highlighted by fiber applications which could consume twice what they did in 1999 should supply become available.
NAPCOR
2105 Water Ridge Parkway
Suite 570 Charlotte, NC 28217
Voice: 704-423-9400
Fax: 704-423-9500
Email: Information@napcor.com
http://www.napcor.com/t-recycling_rate99.html
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