Editorial

It's a wrap – the 2017 PET packaging market

2017 was a bit of a roller coaster year for the PET packaging market in West Europe.

Our latest analysis of the market in 2017 was based on a wide-ranging programme of interviews and discussions with participants throughout the PET recycling chain, including compliance agencies, reclaimers, traders and end users. This research points to a turn-around in market prospects, with a shift  towards greater emphasis on sustainability as opposed to solely on economics.

Our full report includes analysis on the virgin and RPET markets, pricing, collection, reclamation and end use market balance; providing data from 2017 that enables us to forecast out to 2022. You can access an extract of the study from this page today by completing the form.

From excess supply to supply challenges

With exceptionally good weather in Europe boosting demand and capacity outages affecting output, the European virgin PET resin market environment has quickly changed from one of excess supply to supply challenges. And with recycling firmly in the spotlight and sustainability squarely on the corporate agenda, demand for RPET is rising.

But stagnating collection rates in many of the region's markets and the continuing decline in bale quality, means there are considerable challenges ahead.

Rising prices through the RPET chain

Another upward trend is that of rising prices through the RPET chain. Bales prices in particular rose significantly through 2017.

RPET flake prices have echoed the movements in virgin PET and there has been a significant growth in clear RPET flake prices as demand has grown through the year. Set against a backdrop of an exceptional PET pricing environment, for the first time since prices have been recorded, food grade RPET prices were lower than virgin PET resin prices.

In general, the demand for food grade RPET continues to be sustained by large brand owners, particularly in the beverage sector.

PET collection systems, rates and volumes

The potential for recovery of large quantities of PET containers is evident. The total volume of bottles collected in 2017 was near 2 Mt compared to an estimated 3.2 Mt of bottles placed in the market.

Almost three quarters of the collection volumes came from France, Germany, Italy, Spain and the UK. Compared to 2016, only a few countries saw significant increases in recovery volumes, most saw minimal change and six countries actually saw a decrease in collection volumes.

We evaluated the various collection systems used in West Europe and found the majority of PET bottles are still collected via kerbside/drop-off systems, with a  much smaller percentage being collected through deposit schemes.

The full report goes into detail on the issue of colour splits, and includes a call for standardisation in specifications across the region. We review the evolution of colour splits and how colour splits within collection systems have an impact on bale quality. And as deteriorating bale quality is an assiduous challenge for the reclamation industry, we believe standardisation of bale specifications could bring benefits to all aspects of the RPET chain.

We give country specific projections to 2022 for post consumer PET bottle collections in the full report. In addition, we were also able to gather responses from a substantial proportion of the industry on their current and projected reclamation capacities. We did find, however, that reclamation capacity and collection growth are not aligned, with the pattern of capacity relative to collection showing a decrease in 2017.

To download an extract of the report, please complete the form on this page.

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