Good News: The Cost Of Petro-Plastic Is Sky Rocketing

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The 1967 film "The Graduate" kicked off a 40-year, polymer's-in-everything boom with the career advice given to Dustin Hoffman - to 'base his career on the plastics industry'. Today's burgeoning prices for natural gas & oil mark new trends: accelerating reliance on natural ingredients for product formulations; and, industrial processes that are significantly more reliant on bio-based feedstock.

Surging oil prices are beginning to cut into the profits of a wide range of American businesses, pushing many to raise prices and maneuver aggressively to offset the rising cost of merchandise made from petroleum...The Goodyear Tire and Rubber Company is trying to adapt. Its raw material of choice now is natural rubber rather than synthetic rubber, made from oil...Natural oils have been substituted for ingredients made from petroleum; for example, palm oil now goes into a variety of laundry soaps. But like rubber, the cost of palm oil and other natural commodities is rising.
Expect big reductions in packaging mass, too, as packaging costs overcome the marketing benefits of eye-level bill-boarding. Good by Mr Splashy Package; hello Mr. Concentrate.More powerful "green" corollary trends will soon be in play. Waste-to-energy plants (trash burners) will be competing with reclaimed polymer chip buyers for access to plastics in solid waste.

Chinese recycle plants will be competing with American and European recyclers for raw material.

Ultimately there will be an ethical debate over whether is is socially acceptable to burn industrially valuable petro-plastics, releasing greenhouse gases instead making them "food" for new products.

Instead of relying on personal redemption as the impetus for curbside recycling, the market will hunger for "waste" polymer and pay us to separate. We'll all marvel as the national plastic recycle-rates run up from a few percent, to closer to 90%.

The trend of radically increasing cost of petroleum-based fuel, layered on top of the corollary of rising costs of plastic, prospectively can reshape industrial markets, closing recycle loops, and making them increasingly small.

All good things Mr Robinson.

Sidebar: We will have to keep on guard against unintended consequences, such as high-value pesticide containers entering a plastics recycle stream. And "locally grown" bio-based feedstocks will be needed, competing for agricultural acreage normally dedicated to grains. This, we predict, is where the use of genetically modified agricultural plants will find social acceptability.

Via::New York Times, Oil Prices Raise Cost of Making Range of Goods Image credit::Metalex Products, "...plastic chips that come from battery casings".

Tags: China | Natural Gas

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