PETnology Series: "Month in Charts" - a Service by SBAcci

The Best Path to Reaching 2025 rPET Goals

| Business function | SBAcci, Steve Lyons | United States

There is a stream of amazing industry announcements related to innovation in plastics recycling and the associated commitments. Companies are stepping forward to invest in new processes to create circularity and to adopt new business practices related to sustainability.

We have entered a transitional time for the PET industry as we celebrate 80 years of success and ~45 years in packaging. Previous cycles of “reinvention” for PET have included moving from homopolymer to copolymer PET resins, from DMT to PTA, from SSP to Melt-to-Resin processes, “lightweighting”, and industry consolidation.

Increased rPET content goals are taking root in our value chain and altering industry paradigms. This shared objective of higher rPET content needs to be addressed with a variety of different business, technology, and strategy options. A single solution to “sustainability” is not going to work for every unique package and application need. While there is a shared industry goal for improvement, each company has unique choices available to meet their specific goals.

Choosing the best path to increased rPET content in packaging means evaluating package specifications, available technologies, and economics. Current headlines are filled with positive business commitments to a broad range of improvements. For example, the Coca- Cola Company has committed to biomass derived PET in collaboration with Virent. Danone is working with Loop Industries to source PET for Evian™ from advanced recycling. PepsiCo is decreasing their “plastics per serving” footprint for packaging. McDonalds is reducing the plastics content in Happy Meals™.

These activities reinforce that “sustainability” is more than seeking a higher rPET content goal. Given the current supply dynamics for mechanical reclaimers we see industry leaders adopting uniquely individual solutions. This is essential because of the natural limitations on mechanically recycled rPET capacity and feedstocks to supply the jump from ~9% average container rPET content to 15% in less than 50 months. New reclaimate processes and recycling solutions must be adopted. Some of these new paths to increasing rPET content will need to utilize unconventional approaches.

2019 PET industry numbers help us understand the supply/demand/ infrastructure boundaries that help define rPET improvement options. The Association of Plastics Recyclers (APR) has published a total 2019 resin demand for US PET bottles as 2,900 KMT*. The corresponding US mechanical reclaimer capacity for rPET in 2018 was 1,100 KMT with a US bale feedstock stream of 815 KMT. Much of that rPET reclaimate is now going to non-packaging applications such as fibers and strapping. The average PET rigid container had ~9% PCR content in 2019, which consumed ~260 KMT of that feedstock. Achieving 15% average PCR content in rigid PET containers by 2025 could require ~180 KMT more rPET than was consumed in 2019. A moderate estimate for PET bale feedstocks is that another 260KMT of rPET feedstock will be needed in 2025 when compensating for a 70% yield during in processing. Advanced recycling operations would further increase the need for supply of rPET bales, perhaps significantly.

The industry needs expansion in processing capacity from a combination of new mechanical recycling and advanced recycling operations. This need to increase rPET supply to address the sudden surge in demand illustrates why non-mechanical reclamation solutions are needed. And, fundamental to any success for rPET processing technology is getting #1 PET containers placed into the collection stream. So, the need for consumer participation is still critical to any success in higher rPET content. The pre-pandemic US recycle rate of 28% in 2019 needs to reach ~50% by 2025.

The PET packaging industry is in a new state of transition as strong brands and supporting organizations invest in innovation and reinvention. There is not a “one size fits all” solution. Companies are facing the reality that they simply cannot source all of their 2025 rPET demand from the open market. Mechanical reclamation is an essential and valuable part of the 2025 increased rPET solution and we should expect that several NEW mechanical reclamation sites will soon be announced and built. We also need to encourage solutions that move the PET industry towards non-virgin fossil fuel feedstocks such as biobased vPET. We should support new package designs and those solutions that require less plastics. In short, we need to rethink “what good looks like” in PET packaging….as exemplified by the activities that we are seeing from brands and industry leaders.

The PET value chain is facing tremendous hurdles in their quest for higher levels of sustainability. The PET packaging industry has successfully addressed other challenges over the past 45 years. It’s time to appreciate and applaud the adoption of innovative solutions that best fit the unique brand, product, and package needs. There will be winners and losers in the effort to reach 2025 rPET content goals. Those that realistically recognize their viable choices beyond traditional solutions will enable the best path to meet their 2025 goals...and beyond.

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* SBAcci has our own detailed supply/demand data totals and breakdowns for vPET and rPET. The publicly available APR numbers for the industry are useful for public discussions.
 

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