Will multiple COVID outbreaks affect the recycled market?

In Mar, China is battling an upswing in Covid-19 cases and according to the National Health Commission by Mar 23, Chinese mainland reports 2,054 new confirmed COVID-19 cases, with 2,010 locally transmitted. For recycled market, the epidemic has little influence on the plant operation, but there is more impact on the product delivery and transportation. Besides, the feedstock recycling and circulation is also affected. Even the temperature picks up and consumption increases, the recycling volumes may not reach the anticipated.

Recycled plants maintain the normal operation overall and only several plants are affected by the epidemic. In Guangdong, one HC re-PSF plant was shut on Mar 16, with a capacity of 100 tons per day, but the plant has restarted currently. Moreover, one plant in Anhui was closed due to the epidemic, with a HC re-PSF capacity of 120 tons per day. One plant in Jiangyin of Jiangsu province cut production, with a solid re-PSF production of 50 tons per day.

Among the major producing regions of solid re-PSF and HC re-PSF in Zhejiang, Jiangsu, Hebei and Guangdong, the number of new cases in a single day has been below 10 on Mar 23. The epidemic on plant operation has no direct impact, while the control management restrains the delivery and transportation, but currently, the demand is originally weak. Sales are mostly thin currently, and traders are not active to replenish, especially the HC re-PSF, plants worry about the demand later as the traditional slack season will come in the second quarter. In short, recycled plants will focus on selling, and HC re-PSF inventory is accumulating. If sales see no improvement, the market may be weak in Apr, and production cut may appear.