China re-PET market supply and demand in 2022

China re-PET feedstock supply has seen obvious changes in 2017-2018. With the implementation of ban on solid waste in China, imports of PET flakes and bottle bales reduced significantly, and total imports dropped from 2.167 million tons to 0.25 million tons. In 2018, some enterprises invested abroad on re-PET chip, and import volumes recovered slightly, but later, due to the inspection of China Customs and lower prices in China, the imports of re-PET chip reduced apparently. In recent two years, imports are mainly some high-end clean flakes.

Polyester parings and scraps are mainly polyester drawing waste, clump and off-grade PET fiber chip during the production of polyester. Due to continual capacity expansion of polyester in China, polyester production has increased year by year, and supply of polyester parings and scraps also rose. In 2021 and 2022, the supply reduced somewhat as we adjusted the level in the polyester production.

For recycling volumes of PET flakes, PET bottle chip consumption increased during 2017-2019, and recycling volumes also stepped up year by year. In 2020, recycling volumes dropped apparently under the impact of epidemic and low prices, and in 2021, recycling volumes increased, but still lower than the level during 2017-2019, mainly because consumption of PET bottle chip in sheets increased apparently. Therefore, the consumption in sheets is classified into Others category, and the volumes of Others increased apparently compared with 2020.

Popcorn is mainly made from waste down, film and clothing, and the volumes are relatively steady.

In 2022, re-PET supply and demand was basically flat compared with 2021, and the growth was limited overall. Recycled chemical fiber production decreased slightly from 2021, so demand weakened correspondingly. The increase of demand was mainly from the substitution of PET fiber chip and PET bottle chip.

Re-PET industrial changes in 2022

1) High pressure from the environmental protection regulation maintained for long time, and non-standard small and medium-sized plants were eliminated gradually. The market faced shuffle further.

2) Investment on high-end PET flakes continued. Market competition was fiercer, and the spot profits narrowed further.

3) The consumption of PET flakes in non-chemical fiber fields increased, like daily use packaging and sheets, and its application in food field also emerged. But the products were still mainly for exports.

4) High-end and eco-friendly re-PET chip profits shrank apparently, at around cost line for the whole year, and saw periodical losses. The industry entered into elimination cycle quickly.

5) The tax check in China remained strict.