Material Market Update - March 3, 2026

From the CEO

Good afternoon folks,

The Strait of Hormuz is effectively closed. IRGC has threatened any vessel that attempts passage, multiple tankers have been hit, and every major container line has suspended operations through the strait. Brent crude jumped 13% and tanker freight rates hit an all-time high. Needless to say, this conflict is moving markets and the question now is - for how long?

37% of globally traded PE and 28% of PP originate in the Middle East. That supply is either stuck or getting rerouted, and Asian and European buyers are already scrambling for alternatives. The US is taking advantage of this. CMA CGM has already announced a container conflict surcharge on Middle East loadings, and European suppliers are communicating price increases.

Although the US is positioned well to support domestic refineries with its abundance of natural gas, increased export demand is applying pressure. Analysts are projecting US price increases on PP and PE to go through for March. This dynamic will be leveraged by producers that have sat on heavy inventories to rebalance their positions. We expect to see a jump in trading volume.

PET as a net-import material has its own dynamics. The tariff ruling head-faked markets downward before the Iran conflict sent them back up. Domestic virgin PET is expected to trend upward as it follows crude. APET from Oman continues to ship but is at risk. rPET is expected to bounce off the bottom of a depressed market as west Asian supply seizes, ocean freight increases, and domestic resin prices rise. The timing here is navigable for buyers between packaging and bottling seasons, but a continuation into April has the potential to shoot pricing up quickly.

In January, we saw the first blip of manufacturing recovery in the PMI data. At the end of February we got a supply shock. In Q2, we will get Trump's new Fed chair. If you've been waiting around for the market to heat up over the past couple years, you might be in luck. If you are wondering how you can join in on this activity, Matium is welcoming all buyers, sellers, and traders to be a part of the market.

Thank you,
Bailey Robin - Cofounder/CEO

Key Indicators

Sources: FRED, ISM, US Census.

Markets & Trade

1. Plastics Industry Responds to Supreme Court Ruling on Tariffs

Source: Plastic Today

• The Supreme Court invalidated major global tariffs imposed by the Trump administration under the International Emergency Economic Powers Act, impacting over 60% of tariff revenue collected to date.
• Key segments of the plastics industry, such as pipe extruders dependent on imported resins, were significantly affected by these tariffs, which drove up raw material costs and complicated export operations.
• While President Trump swiftly announced new tariffs under a different provision, these measures are time-limited and introduce further uncertainty regarding future trade policy and possible refunds, with total reimbursement costs potentially exceeding $130 billion.
• Industry leaders, including the Plastics Industry Association, are calling for consistent and predictable trade policies to provide American manufacturers the stability needed for investment and global competitiveness, amid ongoing regulatory and administrative complexities.

2. Buckle Up: More Tariff Turbulence Ahead

Source: Plastic Today

• The Supreme Court struck down most of the Trump-era tariffs, prompting the administration to impose new across-the-board 15% tariffs that directly impact plastics processing equipment imports.
• Plastics equipment makers, such as LS Mtron and Wittmann USA, report that the tariffs are creating purchase order delays and financial pressures for customers, while business is expected to stabilize or even grow in 2026.
• Industry leaders warn that regulatory unpredictability—more so than the direct cost of tariffs—poses a greater challenge, complicating long-term investment and strategic planning.
• The Trump administration is considering additional Section 232 tariffs targeting industries including plastic piping, signaling further market volatility and policy-driven disruptions for plastics manufacturers.

3. 2026 Plastics Recycling Conference: the Growing Need for Systemwide Change

Source: Recycling Today

• U.S. reclamation capacity for recycled PET (rPET) has declined by about 25% in the past 12-18 months, with multiple facility closures attributed to diminished domestic demand and increased imports of cheaper resin.
• Emerging extended producer responsibility (EPR) laws in seven states are expected to boost collected plastic packaging, exacerbating the existing mismatch between supply and reclamation capacity and creating urgent supply-demand challenges.
• Panelists suggest structural solutions, including harmonizing EPR requirements across states, implementing recycled content mandates, and introducing financial incentives such as tax credits or procurement bonuses to support domestic recycling and PCR usage.
• Industry leaders warn that immediate action is needed to prevent PET bales from being landfilled and to protect American jobs, emphasizing the need for both regulation and stronger industry collaboration to stabilize recycling markets.

4. Weekly Chemistry and Economic Trends (02-27-26)

Source: American Chemistry Council

• U.S. major plastic resin production rose for a second consecutive month in December 2025, up 2.4% to 8.6 billion pounds, while sales climbed 5.5% to 8.7 billion pounds; on a year-over-year basis, both were down 2.7% and 4.3% respectively, but full-year sales still edged higher by 1.1% versus 2024.
• Plastic resin export volumes finished the year strongly, rising 3.4% month-over-month and 1.3% year-over-year in December, with full-year 2025 exports up 3.7% versus 2024, underscoring continued global demand.
• Chemical producer prices, including plastic resins, reversed a several-month decline to increase by 0.5% in January, with further gains in specialty and basic chemical segments, while prices for bulk petrochemicals and manufactured fibers declined; overall, chemical prices remained up 0.8% year-over-year, albeit at a slower pace.
• U.S. chemical exports fell 2.2% in December and 10.1% year-over-year, reflecting softness in basic and specialty chemicals, while U.S. chemical imports rebounded 6.5% for the month following large increases in consumer, basic, and inorganic chemicals imports; annual trade balance widened from $26 billion in 2024 to $34 billion in 2025.
• Wholesale chemical inventories in December hit their leanest level since May 2014, with the inventories-to-sales ratio dropping to 1.04 as sales jumped 3.5%; for plastic makers, inventories remain tight compared to rising shipment and export levels, suggesting little risk of market oversupply in the near term.

Business & Corporate Strategy

1. Evergreen to Close Ohio, New York rPET Facilities

Source: Recycling Today

• Evergreen Recycling, one of North America's largest rPET producers, will close its facilities in Clyde, Ohio, and Albany, New York, resulting in 247 layoffs after actions taken by its lender halted operations and swept company cash.
• The closures stem from the lender's decision to seize assets and stop funding following Evergreen's ongoing financial distress, including a Chapter 11 bankruptcy filing in early 2023.
• Despite previous expansions, including a $22 million upgrade in 2022 and multiple acquisitions since 2021, Evergreen's financial instability has led to uncertainty about the status of its remaining Nova Scotia plant.
• These shutdowns will likely impact rPET supply chains in North America, potentially tightening recycled PET availability for packaging and beverage sectors.

2. A Look Inside WM's New $90M South Florida MRF

Source: Recycling Today

• WM has opened a state-of-the-art $90 million material recovery facility (MRF) in Pembroke Pines, Florida, with the capacity to process approximately 275,000 tons of recyclables annually, serving multiple South Florida counties.
• The facility features advanced sorting technologies, including 18 optical sorters and artificial intelligence-enabled equipment to separate materials such as PET, HDPE, polypropylene, and hard-to-recycle plastics, enabling higher efficiency and market adaptability.
• Dedicated systems manage challenging waste streams—such as post-consumer plastic film, which is baled and sent to cement kilns for use as a feedstock—while the facility also targets PET thermoforms and maintains redundancy with multiple specialized balers for operational resilience.
• WM's broader strategy includes investing over $1.4 billion in 39 new and upgraded recycling facilities across North America by 2026, signaling robust commitment to infrastructure expansion and enhanced circularity in plastics and related materials.

3. LyondellBasell Scales Back Recycling Target

Source: Recycling Today

• LyondellBasell has revised its 2030 climate and circularity goals, reducing its annual recycled and renewable-based polymer production target by 60%—from 2 million metric tons to 800,000 metric tons—citing market conditions and the need for disciplined capital allocation.
• The company also scaled back its Scope 1 and 2 greenhouse gas emission reduction target to 32% by 2030, down from the previously stated goal of 42%, reflecting a more measured approach given economic and regulatory uncertainties.
• Despite these adjustments, LyondellBasell is continuing construction of its MoReTec-1 chemical recycling plant in Germany, which marks a step forward in commercial-scale catalytic chemical recycling technology.
• The company assures stakeholders that existing supply commitments and commercial contracts will remain unaffected by the updated sustainability and production goals.

4. Plastics Industry Thrives Amid Challenges, Driving M&A Momentum

Source: Plastic Today

• The plastics industry completed 345 mergers and acquisitions in 2025, showing resilience despite economic headwinds, with activity rebounding in the second half as inflation stabilized and market visibility improved.
• International M&A activity surged to its highest levels since 2017, driven in part by European buyers seeking to mitigate tariff risks by acquiring U.S. assets, while domestic dealmaking declined due to tariff uncertainty.
• Key growth segments included plastic packaging (up 19% in deals) and resin/compounding (up 124%), fueled by stabilized raw material prices and normalization of supply chain disruptions.
• Operational strategies such as automation, AI adoption, and disciplined margin management became critical for companies aiming to attract premium valuations and navigate persistent labor and trade challenges in 2026.

Governance & Oversight

1. PFAS Debate Sparks National Security Concerns

Source: Plastic Today

• PFAS, especially fluoropolymers, are vital in manufacturing semiconductors, EV components, defense systems, and clean energy technologies, with no viable substitutes available for many high-performance electronics applications.
• Ongoing and proposed regulations in the US and EU create uncertainty that threatens global electronics and clean energy supply chains, as redesigning products to phase out PFAS could take decades.
• The U.S. Department of Defense underscores PFAS's irreplaceable role in national security and highlights the lengthy timeline—potentially 10 to 25 years or more—required to develop and approve alternatives for critical missions.
• Industry groups like the Global Electronics Association advocate for science-based regulatory approaches and increased R&D investment, stressing that regulatory coherence and collaboration are essential to balance sustainability goals with supply chain stability and security.

2. Congress Introduces Recycling Standards Bill

Source: Plastic Today

• U.S. lawmakers have introduced the Recycled Materials Attribution Act (RMAA), aiming to establish clear federal standards for recycled content marketing and labeling across the plastics industry.
• The bill directs the Federal Trade Commission to update its Green Guides, which would create nationally consistent marketing definitions, reduce compliance uncertainty, and combat misleading environmental claims.
• Broad support from industry coalitions and associations underscores expectations that RMAA will boost investment in recycling infrastructure, increase utilization of recycled materials, and strengthen U.S. supply chains.

3. California Bill Targets Recycled Content Definition

Source: Recycling Today

• California Assembly Bill 2253 aims to prohibit plastic and consumer product companies from making recycled content claims based on credit schemes and accounting methods that do not reflect actual, physical recycled material in products.
• The bill specifically targets practices like mass balance, free allocation, and book-and-claim accounting, which allow companies to advertise high recycled content levels even when it is not present in the finished product.
• If passed, the legislation would extend existing documentation and compliance requirements for plastic food containers to all products, mandating that any recycled content claims be substantiated by the actual material used and in alignment with Federal Trade Commission standards.

Innovation & Product Development

1. ISBM Technique Creates Lighter HDPE Bottles

Source: Plastic Today

• Polyplastics, Colgate-Palmolive, and PTI have introduced an injection stretch blow molding (ISBM) process for HDPE bottles that reduces weight and cycle time by over 25% compared to traditional extrusion blow molding, cutting material use while maintaining structural integrity.
• Utilizing Polyplastics' Topas COC copolymer, the technology enables efficient processing windows, enhances recyclability, and supports integration of post-consumer recycled content, making it effective for sustainable packaging initiatives.
• The ISBM HDPE bottles offer hot-fill capabilities, expanding their use across food, cosmetic, medical, and household sectors and providing an alternative to colored PET, which poses recycling contamination challenges.
• Commercial launch preparations are underway, with Colgate-Palmolive and PTI conducting development and testing, aiming for broad adoption across packaging markets as companies seek cost-effective, high-performance, and regulatory-compliant solutions.

2. Indorama Ventures, AMB Spa Introduce Recyclable PET Multilayer Tray

Source: Recycling Today

• Indorama Ventures and AMB Spa have launched a new multilayer PET tray that incorporates recycled PET flakes in the core with virgin food-grade PET in the outer layers, targeting enhanced recyclability and circularity for food packaging.
• The tray design directly addresses upcoming European Union Packaging and Packaging Waste Regulation (PPWR) requirements, including the mandate to reach an average of 30% recycled content in plastic packaging by 2030.
• Production of the innovative trays is already underway in France, with supply to UK customers and broader European expansion progressing, demonstrating scalable implementation of circular packaging solutions.
• Industry experts highlight this collaboration as a proof-of-concept that even complex multilayer packaging can meet stringent circularity and recycling goals while maintaining food safety and shelf-life performance.

3. Conair Advances Plastics Industry with AI Innovations

Source: Plastic Today

• Conair has integrated AI-driven technologies into its extrusion and auxiliary equipment, enabling fully automated control of processes from raw pellet to finished product while improving predictive maintenance and operational efficiency.
• Strategic partnerships with equipment makers like Zumbach and Davis-Standard have facilitated seamless machine-to-machine communication, allowing hands-off production that meets precise product specifications and addresses workforce shortages.
• The company's AI systems automatically adapt to material changes and maintenance needs, reducing manual intervention and helping manufacturers bridge skills gaps created by turnover or retirements.
• Conair reports strong growth in the recycling sector, offering advanced size reduction and conveying solutions tailored to the unique challenges of processing recycled plastics, and anticipates a market rebound driven by sectors such as automotive and recycling.

Sustainability & Resource Management

1. K-Cup Pods Now Recyclable in Ontario

Source: Recycling Today

• Keurig Dr Pepper Canada and Circular Materials have enabled empty K-Cup pods, made from recyclable polypropylene, to be accepted in Ontario's Blue Box curbside recycling program, expanding recycling options across the province.
• This development marks a key advancement in Ontario's transition to an enhanced extended producer responsibility (EPR) recycling system, shifting funding of recycling services from municipalities and taxpayers to producers.
• Approximately 75% of Canadians can now recycle K-Cup pods at home, and Ontario has introduced a unified, expanded list of accepted recyclables, allowing residents to recycle more types of packaging regardless of location.
• A province-wide education campaign will inform Ontarians on how to properly prepare K-Cup pods and other expanded materials for recycling, supporting both consumer convenience and producers' sustainability goals.