Material Market Update - April 3, 2026

From the CEO

Good afternoon folks,

This is the hottest plastics market I have seen since 2021 when COVID and the freeze in Texas rattled the markets with demand and supply shocks. I'm writing this market update to share insights into what caused the last boom in plastics, what busted it, what we are seeing now, and where this might go.

Let's go back to 2019 - resins were trading in the 30's and demand was weak. Then March of 2020, the world shut down. We went from trading plastics to trading hand sanitizer - anything someone would buy. The volatility destabilized the chain of producers, compounders, converters, and distributors and created pockets of mismatched supply and demand. Then interest rates dropped to zero which flooded the markets with demand, sending pricing upward quickly and clearing inventories up the chain.

Then the freeze of 2021 happened - a week of cold temperatures shut down polymer production plants and the crackers that supply them. This week-long disruption cascaded into months of resin shortage in a market with booming demand. Price went vertical - PP, PE, and PET resins all traded well over $1.00/lb. As a trader, you made as much money as you wanted to. Recyclers had advantage on resin prices and healthy end markets to sell to. All was good.

The markets found equilibrium by 2023. With higher interest rates, demand softened and the excess supply that came onto the market during the boom started to squeeze margins for the sake of movement. Through 2024, pricing throughout the industry trended downward. By the late half of 2025 and into 2026, bankruptcies and buyouts plagued the industry as spending from lower interest rate environments squeezed the sector.

Then in March of 2026, the Operation Epic Fury began and closed one of the most vital shipping lanes for the global petrochemicals industry. This chokepoint made news around the world for its effect on gas prices, but the sharps in the plastics industry saw the story ahead as a much longer and deeper issue. As the week-long disruption in 2021 caused markets to oscillate for over a year, this month-long disruption (of more significance as well) will surely cause sustained chaos in all derivative markets of oil.

Even if the war ends tomorrow, the downstream plants that turn crude into monomer are shutting down. In the US, we have a strong position with our natural gas production but the rest of the world's polymer chain is falling apart in real-time. When buyers stop asking how much a commodity costs and start asking if they can get it, you know the market has lost grip.

The truth is, no one knows how far this goes. The market doesn't have infrastructure. There aren't detailed pricing indexes. There aren't digital trading platforms and clearing houses (besides Matium) that track flows of material. There are just people that talk about the market. That is how this market works.

At the beginning of this year, we were seeing PP and PE resin in the low 30's and PET resin in the low 50's. I am now seeing PP and PE spot railcars in the 60's and 70's and PET resin in the 80's. Recycled prices are chasing as buyers are unsure if they will get the volumes they need. Brands are calling asking for help to supply their converters.

The supply shock will cause mass volatility through 2026 and pockets will remain through 2026 - if the war ends soon. The problem is that the Strait is now the only leverage Iran has and having friends after this war doesn't seem like a top priority. Trump is also getting pressure from both sides of the aisle to strike harder. I have no crystal ball, but it is a tough call to project the Strait operating at capacity any time in Q2.

With the supply shock understood, we move to demand. We had seen small improvements in demand thus far in 2026 with PMI above 50, but nothing major. We look to interest rates this year to tell the rest of the story. If this war breaks anything in the economy and gives the Fed a reason to drop rates (which one could argue is a main priority of the administration), then we are looking at structural demand stimulus to inflate a plastics market trying to find equilibrium.

This is just the beginning. The scenario modeling here points to a sustained boom in plastics. But, my March Madness bracket is in the bottom quartile - so take my projections with a grain of salt. Go Blue!

Thank you,
Bailey Robin - Cofounder/CEO

Key Indicators

Sources: FRED, ISM, US Census.

Markets & Trade

1. Iran War Fuels Uncertainty in Resin, Feedstock Prices

Source: Plastic Today

• Geopolitical tensions in the Middle East, particularly the closure of the Strait of Hormuz, are driving oil price volatility and causing significant disruptions to global plastics supply chains and feedstock markets.
• US resin producers are capitalizing on export opportunities as global supply chain disruptions push domestic polyethylene capacity utilization above 90%, creating tighter market conditions and upward pressure on resin prices.
• Rising crude oil prices are quickly inflating resin costs globally, especially in markets reliant on oil-based feedstocks, while US producers benefit from lower-cost natural gas feedstocks and increased export demand.
• Despite escalating prices, plastics processors face barriers to changing resin supply, such as specialized technical requirements and lengthy approval processes, meaning immediate shifts in demand are limited even amid ongoing conflict and market fluctuations.

2. Weekly Chemistry and Economic Trends (03-27-26)

Source: American Chemistry Council

• Chemical construction spending reached $45.6 billion in January, rising 0.8% month-over-month and 11.5% year-over-year, with plastic/rubber construction up 13.6% Y/Y, highlighting strong investment into plastics-related capacity.
• Global chemical production increased by 0.2% month-over-month in February and 3.1% year-over-year, with gains in North America and Asia-Pacific, signaling a favorable outlook for plastics manufacturing regions.
• Chemical import prices rose 0.6% in February, while export prices rose 1.1%; however, Y/Y chemical import prices were still down 1.3% and export prices down 0.3%, affecting plastics raw material cost competitiveness.
• Railcar loadings for chemicals rose 2.1% Y/Y (13-week MA) and 3.6% year-to-date, indicating robust logistics activity and steady throughput for feedstocks and intermediate products in North America.
• Rising oil prices (Brent above $100) and stable, historically high U.S. natural gas production may drive volatility in plastics feedstock costs, warranting close monitoring for resin and conversion margins.

3. US PET Recycling Faces Challenges Amid Imports, Oversupply

Source: Plastic Today

• The US PET recycling system is experiencing a severe crisis, with facility closures resulting in a 25% drop in national capacity, regional disparities in infrastructure, and a surge in imports undermining domestic recyclers.
• Industry leaders highlight the urgent need for policy reforms—such as Extended Producer Responsibility (EPR) and stricter minimum content requirements—and buyer commitments to prioritize sourcing recycled PET from US suppliers to stabilize the market.
• Cheap virgin PET and imported rPET have made competition unsustainable for US recyclers, threatening the viability of domestic recycling programs and risking increased landfill or export of recyclable materials.
• Panelists stress that restoring trust and ensuring the long-term sustainability of PET recycling requires a coordinated approach: stronger policies and incentives to encourage domestic rPET demand, enhanced transparency and certification, and cross-industry collaboration.

Business & Corporate Strategy

1. Workforce & Training

Source: Plastic Today

• A wave of plant closures and workforce reductions continues to impact the US plastics industry, as multiple manufacturers—including Tekni-Plex, Spartech, ARaymond, and Inline Plastics—have announced shutdowns and layoffs affecting hundreds of workers between late 2025 and early 2026.
• Economic uncertainty, AI adoption, and persistent talent shortages are reshaping hiring and retention strategies, with companies seeking new approaches to attract skilled labor and adapt to changing labor market dynamics.
• Industry reports indicate mixed signals: while some indicators show bullish sentiments and possible manufacturing rebounds, others highlight substantial job losses—nearly 100,000 roles lost in manufacturing in 2025—even amid historically low jobless claims.
• Organizations across the plastics value chain are launching new workforce training programs, advanced technology certifications, and upskilling initiatives, aiming to future-proof operations and address evolving talent requirements in a competitive landscape.

2. Mexican Coke Bottler to Invest $1B in Ops This Year

Source: Resource Recycling

• Arca Continental, a major Coca-Cola bottler, will invest $1 billion in 2026 to expand production and distribution capacity, particularly enhancing its recycling operations across Mexico, the US, and South America.
• A significant portion of the investment targets the PetStar facility, the world's largest food-grade PET recycling plant, supporting a 70% capacity increase and driving progress toward higher recycled resin content in packaging—aiming for 50% by 2030.
• Arca has expanded its bottle collection network from 8 to 24 centers, recovering 68% of bottles by weight placed in the market, and launched community initiatives to boost collection infrastructure and public engagement in recycling.
• The company continues to vertically integrate its supply chain by securing critical recycling inputs, partnering for optimized logistics and traceability, and redesigning packaging for recyclability, all while managing the financial risks tied to environmental and regulatory pressures.

3. PureCycle Receives €40M EU Grant for New Plant

Source: Resource Recycling

• PureCycle secured a €40 million EU grant to help finance its new polypropylene (PP) dissolution recycling plant in Antwerp, Belgium, aiming for mechanical completion by late 2028 and full ramp-up in 2029.
• The grant strengthens PureCycle's financial position and supports compliance with the EU's upcoming Packaging and Packaging Waste Regulation (PPWR), which mandates increased recycled content in packaging by 2030.
• PureCycle's technology positions the company to produce recycled PP at a cash cost lower than that of virgin resin, potentially reshaping supply economics and enabling cost-effective, high-quality recycled material production.
• Evolving US and EU regulatory frameworks for recycling are impacting PureCycle's strategy, as the company advocates for clear distinction between dissolution and chemical recycling processes to secure favorable treatment under new laws and certifications.

4. GreenDot Acquires French LDPE Recycling Sites

Source: Recycling Today

• GreenDot Global has acquired two French mechanical recycling facilities from RG Group, expanding its operational presence to France and bringing its total number of plastics recycling sites in Europe to five.
• The acquisitions strengthen GreenDot's expertise in recycling post-commercial and industrial low-density polyethylene (LDPE) film, supporting the production of recycled materials for converters and brands amid a market where local LDPE recyclers are scaling back.
• This move allows GreenDot to offer more reliable supplies of recycled plastics designed for packaging applications and aligns its operations with growing demand and policy-driven incentives for recycled content under frameworks like France's ecomodulation and upcoming PPWR targets.
• RG Group's integration is set to increase recycling capacity in France beyond 35,000 tons of LDPE film, reinforcing GreenDot's role in building a circular plastics economy and supporting brand owners seeking to meet sustainability and recycled content requirements.

Governance & Oversight

1. SB 54 and the PCR Sourcing Shift

Source: Recycling Today

• California's Senate Bill 54 is rapidly changing the compliance landscape for brands selling packaged goods, accelerating deadlines for recyclability, compostability, and source reduction in single-use packaging.
• Plastic beverage containers face phased post-consumer recycled (PCR) content mandates, with stricter targets taking effect through 2030, while non-beverage packaging falls under broader extended producer responsibility (EPR) requirements that include participation in a producer responsibility organization, fee structures, and performance targets.
• Food-grade recycled PET (rPET) and high-density polyethylene (rHDPE) are central to compliance due to robust recycling infrastructure and regulatory approvals, but market supply remains constrained and pricing elevated relative to virgin resin.
• Brands are urged to audit packaging portfolios, engage suppliers early, and secure long-term sourcing agreements, as spot market availability for compliant PCR resins is tightening and regulatory details continue to evolve.

2. Coalition Urges Congress to Improve TSCA and Support EPA Resources

Source: Plastic Today

• A coalition of over 100 industry organizations, including key plastics sector groups, is urging Congress to advance targeted reforms to the Toxic Substances Control Act (TSCA) and reauthorize the EPA's fee authority, aiming to streamline chemical reviews and enhance regulatory efficiency.
• The proposed amendments would allow the EPA to expedite approval of chemicals already authorized in select other countries, prioritize approvals of safer alternatives and materials addressing supply chain challenges, and clarify exemptions for replacement parts.
• Industry leaders and lawmakers argue that reform is needed to reduce delays that impact adoption of innovative chemistries, hinder manufacturing competitiveness, and create uncertainty for sectors such as domestic semiconductor production critical to the U.S. economy.

Innovation & Product Development

1. Engel Builds World's Largest Injection Molding Machine

Source: Plastic Today

• Engel has launched the duo 12000 US, the world's largest injection molding machine, enabling cost-effective production of large-format plastic parts with enhanced design flexibility and reduced assembly needs.
• The machine boasts two parallel injection units and a clamping force of 110,000 kN, supporting highly precise, large-area molding and offering significant opportunities to replace traditional materials like metal and concrete with plastics.
• Automotive manufacturers stand to benefit as the demand for gigamolding grows, allowing for innovative production of large structural components and contributing to trends such as electromobility, lightweight construction, and CO₂ reduction.

2. University at Buffalo Develops Recycled-content Plastic Gauge

Source: Recycling Today

• Researchers at the University at Buffalo have developed a new multi-sensor method, enhanced with machine learning, to quickly and reliably assess recycled plastic content in products such as water bottles, packaging, and textiles.
• The technology differentiates recycled from virgin plastics by detecting subtle structural and chemical markers using four techniques: triboelectric testing, dielectric/impedance spectroscopy, capacitance analysis, and mid-infrared spectroscopy.
• Testing on polyethylene terephthalate (rPET) samples showed the system could determine recycled content with over 97% accuracy across a range of 0-50% recycled material.
• The team aims to integrate the system into a portable device for real-time, on-site verification to facilitate regulatory compliance and support a more circular economy as recycled-content mandates expand.

3. Aimplas Forms BioSupPack to Transform Brewery Waste into Packaging Materials

Source: Recycling Today

• Aimplas, leading the EU-funded BioSupPack project, has successfully developed high-performance bioplastics for packaging by converting brewery waste into biopolymers like PHA and PHB.
• The consortium of 18 partners validated scalable bioprocesses, including plasma pretreatment and microbial fermentation, enabling industrial symbiosis between breweries and bioplastics producers.
• BioSupPack innovations deliver industrially compostable, fiber-based packaging and biobased coatings as alternatives to fossil-based plastics, helping companies comply with upcoming EU Packaging and Packaging Waste Regulation requirements.
• The project's recycling technologies, such as enzymatic recycling and novel selective enzymes, offer effective end-of-life solutions and pathways for integrating circular, biobased materials into existing manufacturing infrastructure.

4. ExxonMobil Signature Polymers Drives Innovation with High-Performance PCR Stretch Hood Film

Source: Plastic Today

• ExxonMobil and Reifenhäuser have developed a stretch hood film containing up to 35% post-consumer recycled (PCR) content from household streams, addressing challenges related to contamination and inconsistency in household-derived PCR.
• The new film leverages advanced polymers and Reifenhäuser's twin-screw extruder technology to transform lower-quality PCR into high-performance packaging that meets demanding industrial requirements for durability, holding force, and friction control.
• Rigorous testing on commercial hooding equipment demonstrated the film's ability to maintain load security and mechanical strength, despite the use of lower-quality recycled materials.
• This innovation responds to rising regulatory and market demands for sustainable packaging and demonstrates the potential of modern materials science and industry collaboration to enable circular solutions in industrial plastics applications.

Sustainability & Resource Management

1. Hawaii Turns Plastic Waste into Pavement

Source: Plastic Today

• Hawaii researchers, in collaboration with the Hawaii Department of Transportation, are successfully incorporating recycled fishing nets and residential plastic waste into asphalt roads as a sustainable waste management solution.
• Studies presented at the American Chemical Society confirm that roads made with recycled plastics perform comparably to conventional polymer-modified asphalt, without increasing microplastic pollution in Hawaii's tropical environment.
• Advanced chemical analyses reveal that tire wear produces far more microplastics in road dust than the recycled plastic pavement itself, alleviating concerns about environmental risks from the new material.
• The initiative demonstrates the technical and environmental feasibility of recycling local plastics into critical infrastructure, offering a scalable model for reducing landfill and marine debris while enhancing road durability.