Among the economic disruptions COVID-19 has caused, the steep drop in the price of crude oil is putting many corporations in a pickle regarding pledges they’ve made to reduce their use of virgin plastic packaging.
The decreases in crude oil prices, which fell below zero for the first time in late April, have in turn dragged down the value of virgin plastics, and at the same time the recycled material available to make bottles, boxes and bags has become more scarce and expensive.
As a result, some industry experts are becoming concerned that corporations may be forced to back away from the pledges they’ve made to slash their use of virgin plastic packaging.
"We talk to many processors, many MRFs [materials recovery facilities], many collection and hauling companies every day," says Closed Loop Partners Executive Director Allison Shapiro. "They are unanimous in expressing their gratitude to corporate commitments. Everybody’s nervous that corporates may back out of their commitments."
On the other hand, there are signs of hope that these trends will turn around: the gradual reopening of the economy and the likelihood that the production of virgin plastic resin will slow in response to oversupply, thereby boosting the competitiveness of post-consumer plastics.