The Chinese government has been sending inspection teams into Hong Kong and Tianjin in order to prevent poor quality LDPE being imported into the country.
A price fall of between $50 to $80 has been seen on high grade material there as a result of this and also because of the Chinese government forcing down price. This has made it very difficult, if not impossible, to sell the low grade mixed LDPE material into the Chinese market.
This means that the UK price for LDPE 92/2 is now at around £270 to £310 as a result, according to the scrap-ex daily price bulletin.
Next Gen Recycling director Dan Robinson told scrap-ex news: “There are two main reasons why the price has fallen. The predominant one is that the Chinese government has high inflation and low growth. As it owns a lot of the businesses there, it has decided to force down the price that petrochemical plants can pay for oil, and this has filtered down into the virgin plastic market and then the scrap plastic market.
“It is also sick of getting crap exported. So the Government has sent an inspection team down into Hong Kong, and then another one last week down into Tianjin, and this has had the result of forcing down the price. You can’t sell the low grade material for love or money as a result.”
China also celebrated a national holiday on Monday, which may have also had a temporary impact on the market price.