Stable condition.

"I'm cautiously optimistic," a thermoplastic recycler based in the Southeast says about the forecast for industrial grade thermoplastics as the first quarter of 2006 advances. Markets appear to be more stable than they were at this time last year, she says. "There was not enough material out there this time last year."

A Midwest recycler has a slightly more bullish take on the outlook for recycled resins looking forward. "All signs are pointing toward a strong first half of the year in all plastics," he says.

Industrial generation appears to have slowed down a bit since the start of the year, but the Southeast recycler says it is "hard to tell if it is decreased production or lag time from the holidays." While a downturn in industrial generation is expected around the holidays, "lf it lingers into [March], then it might be a trend," she adds.

Much of the company's scrap comes from the region's automotive industry. However, the thermoplastic recycler does not expect to be negatively affected by the recent plant closings announced by Ford Motor Co. and General Motors, because most of the automakers in the area are foreign based companies. "If someone is going to drop production, someone is going to fill the gap," she says.

The Midwest recycler also mentions that industrial generation has slowed at the start of the year, but he adds that it has been more apparent in paper than in plastics.

The Midwest recycler says he expects markets to remain stable for recycled industrial resins and bottle grade plastics. "Prices dropped off a little but, but not a lot," he says of bottle grade resins, with PET dropping "a couple of cents" and colored HDPE jugs falling only a penny since the start of the year.

He adds that natural HDPE is "staying pretty strong," with prices in the low-30s for baled material, while PET is selling in the mid-teens.

Demand for material remains strong, the Midwest recycler notes. "It's all we can do to keep up with our needs here right now. There has been no pullback."

He reports strong performances in the first quarter of 2006 for a number of recycled resins. "I haven't seen any pricing drop off for film scrap," the Midwest recycler says. He's also seen strong, steady demand for polypropylene and PPO (polyphenylene oxide) in the last six or seven months, and says he expects demand for the material to continue for a while longer.

Trucking issues are still negatively affecting plastics recyclers and consumers, though it has eased up a bit in the Southeast following the turmoil created by hurricanes Katrina and Rita. "Trucking seems better," the Southeast recycler says. For a time, it was difficult to get trucks to transport material in the region, because the drivers were holding out for work from the Federal Emergency Management Agency (FEMA), which was reportedly paying $4 per mile, making it difficult for recyclers to compete.

Fuel surcharges are still common, the Southeast recycler says, and will likely remain for the foreseeable future.

While the hurricanes may have had a negative effect on trucking, the Southeast recycler says they have had a positive effect on PVC demand. Once again, FEMA is playing a role. PVC is used to make underpinnings for mobile homes, which the agency is placing with residents who were displaced by the hurricanes and the flooding in the Gulf Coast region.

This is good news for recyclers, as overseas PVC demand "has dried up," according to the Southeast recycler. "Plants coming online in Asia are fulfilling that demand," she says. Chinese New Year has also impeded overseas demand.

The Midwest recycler says that all plastic grades are enjoying good markets right now. "ABS and polystyrene are not having any trouble moving," he says. "Demand is out there for all of these grades, and supply is not an issue."

(Additional news about plastics recycling markets is available online at www.RecyclingToday.com.)