The coronavirus pandemic has piled on top of existing plastics recycling market strife to cause pricing fluctuations and create uncertainty about how end users will meet their sustainability commitments.

Recycling markets for nearly all materials have been challenged for the past few years due to shifts in overseas demand. Additional pressure has come from tariffs on recycled materials and other goods, as well as ongoing strife in the freight market.

Now, the coronavirus pandemic has added health and safety concerns, employment shortages and a general slowdown in manufacturing.

“It’s every possible challenge you could imagine, I think,” said Joe Pickard, chief economist for the Institute of Scrap Recycling Industries (ISRI), in a webinar hosted by several recycling stakeholder groups last week. He said that the current situation may represent the most difficult time many recycling companies have ever faced.

For plastics, the coronavirus impact has come historic drops in oil prices, meaning virgin plastic could be significantly cheaper than recycled resin for the foreseeable future.

“We’re going to really see a test on sustainability for some of the brand owners and their goals,” said Joel Morales, senior director of Polyolefins Americas for market research firm IHS Markit.

Experts laid out the current market and their projections for the future in last week’s webinar, held by the National Recycling Coalition, U.S. EPA and industry consultancy RRS.

PET plastic feels the heat

Plastics recycling companies are experiencing similar pressures as other sectors: They’re adjusting workplace safety procedures to prevent COVID-19 spread, shifting operations in response to changes in supply and demand, and looking to federal programs for financial assistance.

But they’re facing an additional hurdle, a freefall in crude oil prices, to the point where some oil futures contracts had certain grades priced at negative values last month, “making U.S. oil not only worthless but a liability,” according to

The oil pricing plunge is the result of a decline in global oil demand due to the coronavirus as well as a surge in production following disagreements between major oil producing countries. Although top oil producers reached an agreement on production cuts last month, the glut of supply continued through the end of April. In recent days, the market has seen a bit of a rebound.

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