2013 Postconsumer Plastics Recycling in Canada

February 2015

Prepared by Moore Recycling Associates for the Canadian Plastics Industry Association

Moore Recycling Associates Inc PO Box 1327 Sonoma, CA 95476 707-935-3390 707-935-1998! www.MooreRecycling.com 2013 Postconsumer Plastics Recycling in Canada 1

Introduction This is the ﬁfth year that Moore Recycling Associates has conducted a survey to determine the amount of postconsumer plastic recovered in Canada for recycling. This report documents how much Canadian postconsumer plastic was collected and reclaimed by U.S or Canadian reclaimers and how much was sold to overseas markets. This study is sponsored by the Canadian Plastic Industry Association (CPIA) and is made possible by the businesses that cooperated by providing data.

Executive Summary In 2013, at least 311.5 million kilograms of postconsumer (including commercial)1 plastic material in Canada was collected for recycling. This represents a 9% increase in recycling over 2012, mostly due to a signiﬁcant increase in purchases by domestic reclaimers. Postconsumer Plastic Collected (kgs)

400,000,000

300,000,000

200,000,000

100,000,000

2009 2010 2011 2012 2013

PET Bottles HDPE Bottles PP Bottles Non-bottle Rigid Film Foam

1 Throughout this report the term “postconsumer” refers to plastics that have been used for their intended purpose by consumers and by businesses. Commercial materials are often recovered outside of curbside or drop-off collection programs and include items such as totes, pallets, crates, and other commercial packaging (this report does not cover the recycling of industrial plastic, which the U.S. EPA deﬁnes as materials, such as scrap and trimmings, that are generated in manufacturing and converting processes).

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Overall, 84% of the material reported was reclaimed in Canada or the U.S. and 15% was exported overseas. The destination is unknown for the remaining 1%. This study, which documents 5 years of recycling data, consistently indicates that material collected in Canada for recycling routinely remains in North America rather than moving to overseas markets.

Summary of Canadian Postconsumer Plastic Recycling2 3

2013 Change in 2013 2013 North American End Markets Collection Collection Capacity2 Utilization3 (millions of 2012-2013 (millions of of kgs) (millions of kgs) Capacity kgs) PET Bottles fiber, food & beverage bottles, film & sheet, 112.8 9.4 NA NA strapping, and non-food bottles HDPE Bottles bottles, pipe, film & sheet, automotive 66.7 0.3 110 72% applications, lawn & garden products, lumber & decking PP/Other For PP: automotive applications, crates & Bottles 9.1 4.1 NA NA buckets, caps & closures, lawn & garden products Non-Bottle automotive applications, crates & buckets, Rigid Plastics lawn & garden products, pipe, film & 66.3 0.8 110 72% sheet, fence posts, consumer and household products Film film & sheet, pipe, automotive applications, 54.0 10.2 53 44% lawn & garden products, pallets, lumber & decking, crates & buckets Foam protective packaging, building products, 2.7 1.7 NA NA picture frames

Increased collection, as well as continued progress in companies responding, contributed to the growth in postconsumer plastic reported. This report’s ﬁndings are based on data from two surveys: a postconsumer plastic recycling survey of export markets for all postconsumer plastic categories and all domestic markets—except PET bottle reclaimers—conducted by Moore Recycling, and a separate survey of PET bottle reclaimers conducted by the Association of Postconsumer Plastic Recyclers (APR) and the National Association for PET Container Resources

2 Capacity for processing bottles often overlaps with capacity to process non-bottle rigid plastic and/or ﬁlm. Thus, adding the capacities reported here for bottle, non-bottle rigid and ﬁlm could result in some double counting.

3 Utilization is determined using estimated capacity and reported purchases by Canadian reclaimers.

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(NAPCOR). Data for this report was provided by 52 companies 4—23 Canadian and 16 U.S. plastic reclaimers5, as well as, 13 exporters. Data gathered in the survey is cross-checked with data available from Canadian provinces and other recycling industry information. This is a voluntary survey, so the amounts reported here represent the minimum known to be recovered for recycling.

Postconsumer Plastic Recycled by Major Category (kgs)

All categories of reclaimed plastic showed increased collection over 2012, although the bottle and film categories represented most of Foam 2,680,000 the growth: a 13-million-kilogram increase in bottles and a 10-million-kilogram increase in film. Film Plastic bottles continue to make up the majority of 53,963,000 the recycled plastic. PET bottles are the highest volume plastic product segregated by resin collected for Bottles 188,539,000 recycling, followed by HDPE bottles. Given the consistency in year-over-year participation by bottle reclaimers, the reported increase in the total Non-Bottle Rigid amount of bottles acquired for recycling is clearly 66,337,000 an actual increase, rather than a function of improvements in survey participation. Non-bottle rigid plastic recycling increased only slightly over 2012, in contrast to significant increases from 2011 to 2012. The increase from 2011 to 2012 was primarily due to an increase in mixed rigid bales reported by domestic reclaimers. Some of the non-bottle rigid plastic increase from 2012 to 2013 was also due to increased purchases of mixed rigid bales by domestic reclaimers, but there was a more significant increase in resin-segregated non-bottle rigid plastic reported. The increased purchases by domestic reclaimers offset the drop in mixed rigid bales reported by exporters sending material overseas. This decrease in handling by overseas exporters was undoubtedly due to China’s Green Fence effort, a program during much of 2013 that more strictly enforced regulations pertaining to the quality of imported scrap and resulted in significantly reduced plastic exports from North America and Europe.

4 In contrast to previous year reports, the total for companies responding includes those responding with Canadian sourced postconsumer plastic scrap to the Moore Recycling survey, as well as the APR/NAPCOR PET bottle reclamation survey.

5 Moore Recycling surveys and counts material from reclaimers, deﬁned as companies that wash postconsumer material or otherwise process unwashed material into a clean feedstock or end product.

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North American reclaimers continue to report expansions that enable them to begin processing non-bottle rigid plastic or to process more of it. The volume of non-bottle rigid recycling reported here is likely still conservative, particularly the volume reported as non-bottle rigid plastic segregated by resin (mostly from the commercial sector). An increase in ﬁlm recycling of 23% over 2012 is attributable to both increased collection and strengthened participation in the survey. Growth in capacity for clean, clear single-resin ﬁlm led the slight growth in capacity in 2013 over 2012. The majority of the foam reported was expanded polystyrene (EPS), which was predominantly from protective packaging for durable products and some food packaging, e.g., meat trays, clamshells and coffee cups. The volume reported for foam almost tripled; this is likely due to better responses, but industry efforts to increase collection also had an impact.

Postconsumer Plastic Recycled By Resin (kgs)

PET and HDPE make up the majority of postconsumer plastic recycled in Canada. The majority of the HDPE LDPE PVC PET is from bottles (90%), although the 98,671,000 42,253,000 2,628,000 non-bottle rigid PET portion is growing: 10% compared to 5% in 2012. PP 32,279,000 Recycled HDPE is comprised of 68% bottles, 22% non-bottle rigid and 10% PET 125,687,000 ﬁlm; this is consistent with 2012. The Other 6,574,000 PS third largest resin collected for recycling 3,426,000 is LDPE, consisting primarily of ﬁlm (99%). PP consists of 77% non-bottle rigid and 23% bottle material.

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Methodology Moore Recycling Associates conducts the Canadian survey simultaneously with the annual U.S. Postconsumer Plastic Recycling Survey. This is a voluntary survey. The survey gathers data on all Canadian- and U.S.-sourced postconsumer plastic except that purchased by PET bottle reclaimers in Canada or the U.S.; as previously mentioned, that data is provided by a study conducted through APR and NAPCOR. To ensure the most accurate information: ! Moore Recycling continually updates its markets database to include current exporters, reclaimers, and other handlers of plastic scrap in the U.S. and Canada; ! Moore conducts an electronic survey of market participants in plastic recycling to collect data; and ! Moore provides a veriﬁcation step for survey-collected data, checking the accuracy of the data through follow-up calls, conversations with industry contacts, and reviews of other public sources of recycling industry information, including available provincial data.

Data Collection and Analysis As noted, Moore Recycling continually updates a proprietary database6 of plastic exporters, processors, reclaimers and key brokers to ensure that the survey reaches all the key plastic scrap buyers from North America. Moore Recycling uses a custom-designed web-based survey system to gather data. Although the overall methodology has not changed since the first report, Moore Recycling continually seeks ways to improve the completeness and timeliness of the survey responses. For example, beginning in 2013, Moore Recycling asked responders to separately report rigid plastic categories segregated by resin, depending on whether it was acquired in bale form versus already ground into flake. This change allows for better material flow tracking and helps to avoid double counting. Moore Recycling also updated the names for many of the mixed rigid plastic categories to reflect bale specifications released by the Association of Postconsumer Plastic Recyclers (APR) bale terminology.7 An email with a unique link and message is sent to each contact. After an adequate amount of response time has passed, Moore Recycling staff send follow-up emails and make telephone calls to retrieve data. This follow-up process can take weeks or months depending on

6 Through its project work in the industry and its web sites—PlasticsMarkets.org, RecycleMorePlastic.org and PlasticFilmRecycling.org—Moore Recycling regularly receives requests from new contacts for information on material and markets. Moore also identiﬁes potential buyers through published market databases and conversations with suppliers, such as material recovery facilities (MRFs) and key reclaimers.

7 Bale speciﬁcations released by APR utilize the “Terms and Tools,” found at https://www.recycleyourplastics.org/recycling-professionals/education/terms-tools-app/.

Moore Recycling Associates Inc PO Box 1327 Sonoma, CA 95476 707-935-3390 707-935-1998! www.MooreRecycling.com 2013 Postconsumer Plastics Recycling in Canada 6 responses. Data is entered in the online survey tool, either directly by the company being surveyed, or by Moore Recycling staff when the survey is completed over the phone, by email or fax. As it is received, the data is reviewed for accuracy and follow-up calls are made, as needed. After data collection is complete, the data is compiled and categorized based on the detail reported. The final data totals are reviewed and analyzed, then reported with as much detail as possible without compromising the participating companies’ confidentiality. In order to determine trends and identify anomalies that may require further verification of data, the analysis includes year-to-year comparisons of totals, material categories, and buying trends among export and domestic buyers. Describing how the data is collected, and what is and is not included in the survey, provides readers of this report with the context necessary to cross-reference results with other available industry data.

Survey Categories The survey requested data for PET bottle exports, and for reclamation and export of: • HDPE bottles (natural, colored, mixed) • PP & other bottles • Commingled bottles • Mixed rigid plastic bale categories (detailed below) • Categories for non-bottle rigid plastic segregated by resin - A list of recovered products that are generated as segregated commodities or have been sorted into segregated categories and then sold. The list is based on categories respondents have offered in previous surveys (e.g., PET thermoforms, HDPE injection (drums- buckets- crates), PP hangers, PVC Flooring, PC CDs). Moore Recycling also provide an “other” category for PET, HDPE, PP, PS, PVC, ABS, and PC. • Film (detailed below) • Foam - EPS (Expanded Polystyrene), EPP (Expanded Polypropylene), EPE (Expanded Polyethylene), Flexible Polyurethane, Rigid Polyurethane, Other Foam Detailed mixed rigid plastic bale categories:

• All Rigid Plastic: No Bulky (mixed bottles and containers) - All bottles, all household non-bottle containers (includes thermoform packaging, cups, trays, clamshells, food tubs), with no bulky items. • All Rigid Plastic: With Bulky - All bottles, all household non-bottle containers (includes thermoform packaging, cups, trays, clamshells, food tubs), and all bulky rigid plastic (includes carts, crates, buckets, baskets, toys, lawn furniture)

• Pre-picked Rigid Plastic: No Bulky (bottles and containers with PET & HDPE bottles removed - mainly non-bottle containers) - All household non-bottle containers (includes thermoform packaging, cups, trays, clamshells, food tubs), with very few bottles and no bulky items.

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• Pre-picked Rigid Plastic: With Bulky (all rigid plastic with PET & HDPE bottles removed) - All household non-bottle containers (includes thermoform packaging, cups, trays, clamshells, food tubs), all bulky rigid plastic (includes carts, crates, buckets, baskets, toys, lawn furniture), with very few bottles.

• Bulky Rigid Plastic - All bulky rigid plastic (includes carts, crates, buckets, baskets, toys, lawn furniture), and no bottles or containers. • Tubs & Lids - Non-bottle household containers, including buckets, predominantly PP and PE, with no bulky items. • PE/PP Bottles, Containers & Bulky (Oleﬁn)- Primarily polyethylene and polypropylene bottles, non-bottle containers and bulky items (includes carts, crates, buckets, lawn furniture). • PP Bale - Primarily polypropylene bottles, non-bottle containers and bulky items (bulky as described above). • HDPE Colored Bottles with PP/PE containers - Primarily HDPE bottles, may contain some HDPE or PP household containers, no bulky items.

• Mixed Resin Clamshell Bale - A mixture of PP, PET, PS, PVC clamshell-type containers.

• Other Mixed Rigid Plastic - A “catch-all” category, deﬁned on a case-by-case basis. Moore Recycling also asks for data in these categories:

• Post-Commercial Mixed Rigid Plastic - A “catch-all” category for mixed resin rigid plastic that is generated from businesses, deﬁned on a case-by-case basis.

• Mixed Electronic Scrap - primarily HIPS, ABS, PC Detailed Film categories:

• Commercial Clear Film - Clear, clean PE (polyethylene) film, including stretch wrap and poly bags • Commercial Mixed Color Film - Mixed color PE film, including stretch wrap; no postconsumer bags • Mixed Film - Mixed color, clean PE film, including stretch wrap and retail-collected postconsumer bags, sacks, and wraps

• Curbside Film - Mixed PE film generated at MRFs • Clean Ag film - Dry and from uses that do not touch the ground; up to 10% contamination • Dirty Ag film - From the ground; up to 50% contamination • Other film - A catchall for film that does not fit in any of the categories above; mostly non-PE films such as polyvinyl chloride (PVC) and polypropylene (PP).

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Data Gaps and Assumptions This is a voluntary survey and the data reported are based on verified responses. Many companies have limited resources to put towards participation in the survey and some companies may choose not to respond due to confidentiality policies. Therefore, as there is not 100% participation, the totals presented represent the minimum amount of plastic recovered for recycling and sold into the marketplace. Only data provided by North American reclaimers and exporters selling directly overseas is included in the totals reported, unless it is determined that data are missing in areas where substantive information from other reliable resources is available. Data provided by brokers and MRFs are primarily used as reference to better understand the flow of material, but Moore Recycling may include their data if enough information is provided that would enable us to attribute material sold to a non-responder. Except for the largest exporters, players in the export market come and go, and may frequently change the materials purchased. This can make the export market difficult to track. Moore Recycling tracks exporters handling plastic through a number of industry resources and most of the large exporters respond to the survey. Moore Recycling cross-checked the 2013 data with available provincial collection estimates and also referenced Statistics Canada’s estimated national totals. If there were large gaps between the survey responses and other industry data, Moore Recycling conducted additional research to ensure the results represent a reasonable accounting of postconsumer plastic collected in Canada for recycling. For example, as was the case in previous years, the 2013 survey responses from exporters and reclaimers reflected a lower total for curbside film than what the provinces reported as recovered. After additional information was gathered from industry contacts, Moore Recycling added the curbside film data from provincial collection estimates to reflect the minimum amount of postconsumer collected for recycling in 2013. Since the survey is a voluntary effort, Moore Recycling sometimes receives responses from existing companies that did not previously respond. Increases in year-over-year recovery rates are often a combination of increased collection along with material that was recycled in previous years but not reported. When Moore Recycling can conclude the nature of an increase (or decrease), the reasoning is indicated; although, it can be difficult to make a solid determination in any given year, depending on the depth of information Moore Recycling receives from plastic handling companies for previous years and taking into account confidentiality concerns. Often, Moore Recycling must follow up with responders due to inconsistent placement of data in survey categories. Quality control is essential to determine if there has been an actual shift or just an entry error. Clarification is often needed to determine if material reported can be counted as postconsumer commercial or is in fact industrial scrap. Mixed rigid bale commodities often require follow up and a data quality check due to the inconsistent terminology used in the marketplace to describe these commodities.

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Postconsumer commercial material can be difﬁcult to track since it is often purchased by companies also handling industrial scrap. The survey does not include industrial scrap. In Moore Recycling’s opinion, including industrial plastic scrap could have a very positive impact on identifying more postconsumer material, because many commercial scrap recyclers do not realize that much of what they handle is considered postconsumer—that is, it has met its intended use. An industrial survey could also document that a considerable amount of industrial scrap plastic is recovered for recycling. To characterize the mixed rigid bale data, Moore Recycling applies the bale composition results8 from the 2011 Association of Postconsumer Plastic Recyclers (APR) report, National Mixed Rigid Plastic Bale Composition Study & Analysis of Non-Bottle Rigid Plastic Available for Recycling. With the exception of Tubs and Lids bales, for which there is Canadian composition data, the data applied are based on the composition of US mixed-resin rigid plastic bales. Canada is comparable enough to the U.S. to allow conﬁdence in applying the allocation of the other mixed rigid bales to the data. Because the packaging mix has evolved since 2011, some of our assumptions on resin- split and percentage of waste are likely dated. A new mixed rigid bale analysis is underway and is expected to be completed in early 2015.

8 Only the plastic portions of the mixed rigid bales are included in the volume; the waste is removed, unlike gross volumes used for most other recycled commodities.

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Findings In 2013, a minimum of 311.5 million kilograms of postconsumer plastic was collected for recycling in Canada. As expected, most was plastic bottles and the remainder was non-bottle rigid plastic, ﬁlm and bags and a small amount of foam. Postconsumer Plastic Recycled Year-over-Year (kgs)

!300,000,000!!

!250,000,000!!

!200,000,000!!

Foam! !150,000,000!! Film! Non"Bo@le!Rigid!

!100,000,000!! PP/Other!Bo@les! HDPE!Bo@les! PET!Bo@les! !50,000,000!!

!"!!!! Export! Export! Export! Export! Export! Domes7c! Domes7c! Domes7c! Domes7c! Domes7c! Unknown! Unknown! Unknown! Unknown! Unknown!

2009! 2010! 2011! 2012! 2013!

The reported increase in the bottle category is attributable to an actual increase in the collection of plastic bottles, rather than to an improved survey response rate. Even though domestic reclamation of mixed rigid bales increased, a decline in purchases by the export market resulted in fewer mixed rigid bales reported as purchased in 2013. This was offset by increased domestic purchases of non-bottle plastic segregated by resin, resulting in a modest increase overall for non-bottle rigid plastic. Non-bottle rigid recycling represented in this report is still likely conservative, particularly the volume reported as resin-segregated non-bottle plastic generated by the commercial sector. This, as previously noted, is due to the deficiency in tracking commercial scrap that is combined with industrial scrap. The export market reported the majority of the increase in film, although there was a small increase in purchases by domestic film reclaimers. The reported figure for foam recycling reflects a better estimate of the actual volume, as Moore

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Recycling received better responses in 2013 from companies handling the material. The total is nevertheless understated, since a number of companies still did not participate in this year’s survey.

Postconsumer Plastic Recycling By Major Category Year-over-Year (kgs) The increases year-over-year represent a combination of increases in recovery of material and improved participation in the survey.910

Year Bottles Non-Bottle Rigid Film Foam Total

2013 189,539,000 66,337,000 53,963,000 2,680,000 311,518,000

2012 174,689,000 64,544,000 43,744,000 983,000 284,961,000

2011 169,341,000 9 50,931,000 37,102,000 753,000 10 258,127,000

2010 150,439,000 29,912,000 36,830,000 NA 217,182,000

2009 132,825,000 28,132,000 27,147,000 NA 188,104,000

Overall, 84% of the material reported was reclaimed in Canada or the U.S. and 15% was exported overseas, a 1% increase in each case. The remaining 1% of the total volume of plastic reported is curbside ﬁlm with an unknown destination. Postconsumer Plastic Recycled Year-over-Year (kgs)

Year Exported Purchased for processing in Destination Total Canada or the United States Unknown

2013 46,007,000 262,171,000 3,341,000 311,518,000

2012 41,106,000 237,437,000 6,418,000 284,961,000

2011 33,862,000 217,558,000 6,707,000 258,127,000

2010 34,728,000 177,125,000 5,329,000 217,182,000

2009 22,168,000 157,174,000 8,762,000 188,104,000

U.S. companies purchased approximately 49.6 million kilograms (16%) of postconsumer plastic from Canada for processing in the U.S. The material purchased by U.S. reclaimers combined with the plastic exported overseas resulted in 95.6 million kilograms (31%) of postconsumer plastic leaving the country, an increase of 1% from 2012. This small increase is the result of a combination of factors: an increase in bottles going to the U.S., an increase of commercial ﬁlm going export and new information available about some of the material previously

9 The 2011 total for PET bottles has been reduced by 10.5 million kilograms, due to an error in the data provided to Moore Recycling. The adjustment is reﬂected in the bottles total and the overall total, both reduced by 10.5 million kilograms from the ﬁgures in the 2011 report.

10 In 2009 and 2010, foam plastic was included in PS reported as non-bottle rigid. Since 2011, foam data has been collected separately in its own section.

Moore Recycling Associates Inc PO Box 1327 Sonoma, CA 95476 707-935-3390 707-935-1998! www.MooreRecycling.com 2013 Postconsumer Plastics Recycling in Canada 12 categorized as “destination unknown.” Canadian reclaimers purchased 212.6 million kilograms of Canadian-sourced recycled plastic (68% of the total reported, same as 2012), and 82.1 million kilograms of U.S.-sourced plastic in 2013. Canadian purchases from the U.S. increased in 2013 by 18% over 2012, all attributable to non-bottle rigid plastic from both mixed bales and resin segregated plastic.

Bottles Bottles are collected in Bottles By Resin Canada through municipal curbside programs, as well as depots and retail drop-off for PET Bottles the beverage deposit systems 59.8% mandated in most provinces. PP Bottles Each province accepts 3.9% different types of beverage containers as part of its HDPE Natural Bottles program and each has a Other Bottles 12.8% unique collection system. 0.9% Collection efforts in Canada HDPE Colored Bottles resulted in 188.5 million 22.5% kilograms of postconsumer bottles sold into the marketplace for recycling. This represents an increase of 8% over 2012. The vast majority of the increase was due to an increased volume reported by domestic reclaimers.

Bottles By Resin Year-over-Year (kgs)11

Year PET Bottles HDPE Natural HDPE Colored PP Bottles Other Bottles Bottles Bottles

2013 112,817,000 24,166,000 42,502,000 7,346,000 1,709,000

2012 103,410,000 21,928,000 44,426,000 4,469,000 457,000

2011 98,141,000 11 20,268,000 46,260,000 4,454,000 218,000

2010 93,857,000 18,800,000 34,846,000 2,664,000 273,000

2009 88,133,000 13,263,000 27,693,000 3,476,000 261,000

11 The 2011 total for PET bottles has been reduced by 10.5 million kilograms, due to an error in the data provided to Moore Recycling. The adjustment is reﬂected in the bottles total and the overall total, both reduced by 10.5 million kilograms from the ﬁgures in the 2011 report.

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PET Bottles In 2013, approximately 107 million kilograms of Canadian-sourced postconsumer PET bottles were reclaimed in Canada and the U.S. and 6.2 million kilograms—6% of the PET bottles collected in Canada—were exported overseas, primarily to China. Most of the PET bottles exported were in PET bottle bales; a tiny amount was in mixed rigid bales. Compared to 2012, Canadian reclaimers purchased about the same volume of Canadian-sourced PET bottles and slightly less U.S.-sourced PET bottles, at 22.6 million kilograms. U.S. reclaimers, on the other hand, nearly doubled their purchases of Canadian-sourced PET bottles from 2012, accounting for a large part of the domestic increase for 2013.

Capacity and End Uses There were four PET reclaimers operating in Canada in 2013. The PET bottle collection volume and domestic reclamation capacity continued to be close to equilibrium. In its Report on Postconsumer PET Container Recycling Activity in 2013, NAPCOR reports that fiber remains the dominant North American end use for recycled PET bottles. The use of rPET in food & beverage bottles grew dramatically in 2013, surpassing its use in sheet & film; strapping, non-food bottles and other products also use recycled PET. The report states that Canadian rPET end uses saw particular growth in fiber and non-food and beverage bottle applications.12

HDPE Bottles Responders reported a total of 66.7 million kilograms of postconsumer HDPE bottles recycled in 2013, a very slight increase compared to 2012. Similar to 2012, more Canadian- sourced natural HDPE bottles were recycled domestically, with a decrease in colored HDPE bottles. Fewer HDPE bottles were exported overseas: 3% in 2013, a decrease of 1% from 2012. Even with the decline from 2012 and 2011, colored HDPE still makes up the larger percentage of total HDPE bottles recovered for recycling, at 64% (42.5 million kilograms). Of the 66.7 million kilograms of HDPE bottles recovered in Canada for recycling, 12.8 million kilograms were sold into the United States for reclamation. Similar to 2012, 52 million kilograms of Canadian-sourced HDPE bottles were reclaimed in Canada. Canadian reclaimers brought 27.6 million kilograms of HDPE bottles from the U.S. to be processed in Canada. While the total volume moving across the border increased somewhat, purchasing practices were consistent with those in 2011 and 2012: U.S. buyers sourced slightly more Canadian material and Canadian buyers sourced slightly less U.S. material.

Capacity and End Uses Moore Recycling estimates 2013 Canadian HDPE bottle reclamation capacity to remain at 110 million kilograms, with reports that a growing portion of this capacity is being used for non- bottle reclamation because the HDPE bottle supply continues to be tight. Moore Recycling

12 Report on Postconsumer PET Container Recycling Activity in 2012, NAPCOR & APR

Moore Recycling Associates Inc PO Box 1327 Sonoma, CA 95476 707-935-3390 707-935-1998! www.MooreRecycling.com 2013 Postconsumer Plastics Recycling in Canada 14 calculates a utilization rate of 72% for 2013 (using estimated capacity and reported purchases). Canadian and U.S. reclaimers continue to report new bottles as the primary end use for reclaimed natural bottles. U.S. reclaimers also report a fair amount going into ﬁlm & sheet and lumber and decking applications. Pipe is the largest end use for colored HDPE bottles in North America. In 2013, Film & Sheet and Pipe continued to be the largest end uses for colored HDPE bottles reclaimed in Canada, followed closely by automotive applications. Colored HDPE bottles are also going into new bottles and, to a lesser degree, lawn and garden products and lumber and decking in Canada.

PP and Other Bottles A minimum of 7.3 million kilograms of postconsumer PP bottles were reported as recycled in 2013, up from 4.5 million kilograms in 2012. This increase was mainly due to a shift in the types of mixed bales reported by domestic reclaimers. About 1% of the PP reported was exported overseas, and U.S. reclaimers reported buying 45% of Canadian-sourced dedicated PP bottle bales in 2013. Based on composition data from U.S. bale sorts, there is likely a small amount of LDPE, PVC and Other (#7) bottles in the Canadian mixed rigid bales reported. LDPE, PVC and other bottles make up 1.7 million kilograms of the total material in this report, up from 2012, due to the types of mixed rigid bales reported for 2013. Almost all of the LDPE, PVC and other bottles come from mixed rigid bales reported by Canadian reclaimers. These reclaimers handle the non-oleﬁn (PVC or Other #7) bottles in one of a few ways: either disposing of them, selling them (if a domestic or export market is available) or, in some cases, providing the material to waste-to-energy facilities. The survey asked reclaimers reporting mixed rigid bales whether they utilized all of the material or disposed of, sold or otherwise provided any portion of it to another reclaimer, exporter, broker or intermediate processor. No bottle material was reported as disposed or sold.

Capacity and End Uses Due to limited data sources, information on PP reclamation capacity is not available. Recycled PP bottles are used to manufacture automotive applications, crates and buckets, caps and closures or items such as lawn and garden furniture.

Non-Bottle Rigid Plastic In 2013, 66.3 million kilograms of non-bottle rigid plastic were reported as reclaimed or exported. This represents a slight increase of 1% over the volume reported for 2012. Of the non- bottle rigid material reported, 31.3 million kilograms was from mixed rigid plastic, down by 4.3 million kilograms from 2012. Non-bottle rigid plastic segregated by resin made up for this decrease with an increase of 5.1 million kilograms, to 35 million kilograms. In 2013, less than half of the non-bottle plastic was reported as mixed rigid bales. Eighty- nine percent of the mixed rigid bales reportedly stayed in Canada, compared to only 72% in 2012

Moore Recycling Associates Inc PO Box 1327 Sonoma, CA 95476 707-935-3390 707-935-1998! www.MooreRecycling.com 2013 Postconsumer Plastics Recycling in Canada 15 and 56% in 2011. U.S. reclaimers purchased very few Canadian-sourced mixed rigid bales and 7.1 million kilograms of resin-separated material, down by 4 million kilograms from 2012. Just 14% of all non-bottle rigid plastic was reported as exported overseas in 2013—down by 12% from 2012— and only 11% of the mixed rigid plastic was exported overseas, compared to 28% in 2012 and 44% in 2011.

Non-Bottle Rigid Plastic By Source

All Rigid Plastic 3% Pre-picked Rigid Bulky Rigid 27% Tubs & Lids 8% 8% Other Mixed Rigid 1%

Segregated By Resin 53%

“All Rigid Plastic” and “Pre-picked Rigid” combines the “with” and “no” bulky categories of each. “Other Mixed Rigid” includes data provided as Mixed Post-Commercial, Other Mixed Rigid Plastic and any mixed rigid bale categories with less than 800 thousand kilograms reported.

This drop in mixed rigid bale exports is due to the growth in domestic infrastructure to handle mixed rigid bales. In 2013, China’s Green Fence effort exacerbated this trend. In February 2013, China’s government began an effort to control scrap imports in an initiative dubbed the “Green Fence.” During much of the ﬁrst half of the year, nearly all scrap containers imported into China were opened and inspected, and spot inspections continued throughout the year. Chinese customs ofﬁcials imposed very tight contamination standards for certain mixed rigid bale commodities—predominantly All Rigid Plastic and Pre-picked Rigid Plastic. While Canada was relatively well situated to handle the Green Fence, in the U.S. it resulted in a very rapid shift from strong demand to limited markets. As a result, North American prices for mixed grades of plastic scrap were volatile in 2013, starting strong, dropping sharply early in the year, then recovering slowly, up to, or close to, their levels at the beginning of the year. In both Canada and the U.S., the Green Fence reduced competition for mixed rigid bales, providing better access to supply for domestic markets prepared to take this material, and more incentive to MRFs to shift their plastic sorts to meet domestic needs.

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Non-Bottle Rigid Plastic By Source Year-over-Year (kgs)13

2013 2012 2011 2010 2009

All Rigid Plastic 1,778,000 6,962,000 4,168,000 2,249,000 5,042,000 Pre-picked Rigid 18,022,000 11,443,000 4,088,000 5,770,000 1,984,000 Tubs & Lids 5,294,000 5,335,000 5,003,000 4,961,000 7,857,000 PE/PP Bottles, Conts. & Bulky - - 45,000 847,000 -

PP Bale - 98,000 172,000 NA NA

Bulky Rigid 5,339,000 4,986,000 176,000 1,802,000 2,714,000

HDPE Colored Bottles with 155,000 - - 16,000 - PE /PP Containers

Electronic Scrap - - - 1,134,000 19,000 Other Rigid Plastic 162,000 6,747,000 6,890,000 89,000 - Mixed Post Commercial 500,000 - 420,000 4,929,000 13 340,000

Plastic Segregated by Resin 35,086,000 29,973,000 29,969,000 8,116,000 10,175,000

Some material categories may not track as expected because respondents may report materials as a mixed category in one year and broken out as segregated resins in another year. For example, in one year a responder may report material under Electronic Scrap and in the next year report it broken out into HIPS and ABS in the segregated resin section.

Non-Bottle Rigid Plastic By Resin (kgs)

PP PVC 2% 37% PET 12,870,000 HDPE 21,940,000 Other PVC 1,412,000 6% PS HDPE LDPE 462,000 PP 24,820,000 1% PET 33% 19% PS 926,000 Other 3,907,000

LDPE 1%

Data from the report 2011 National Mixed Rigid Plastic Bale Composition Study performed by Moore Recycling Associates for APR were applied to arrive at the resin breakdown above. With the exception of Tubs and Lids bales, for which there is Canadian composition data, composition data for U.S.-sourced bales was used.

13 The 2010 report combined Post-Commercial material with Plastic Segregated By Resin and they are broken out in the above chart and graph.

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Consistent with previous years, PP and HDPE make up the majority (70%) of the non- bottle rigid plastic recovered in Canada. PET non-bottle had the greatest increase in 2013 over 2012, making up 19% of the total non-bottle material, compared to only 9% in 2012. This was mainly due to the types of mixed rigid bales reported, but there was also an increase in the percent of thermoforms in PET bottle bales. The category “Other” makes up only 6% of the material reported for 2013; it consists of other mixed rigid plastic material reported without the detail needed to break it down by resin, but it also includes the other resins from mixed rigid bales. Almost 10 million kilograms included in the non-bottle rigid fraction of the mixed rigid bales reported by domestic reclaimers is non-oleﬁn plastic (PET, PS, PVC, Other). The survey asked reclaimers reporting mixed rigid bales whether they utilized all of the material or disposed of, sold or otherwise provided any portion of it to another reclaimer, exporter, broker or intermediate processor. Most of them indicated that they utilized all of the material they purchased from U.S. and Canadian sources.

Capacity and End Uses A conservative estimate for non-bottle rigid plastic reclamation capacity is 110 million kilograms per year, an increase of 28 million kilograms since 2012. This capacity is based either on that reported by reclaimers, or, if none was reported, on the amount of material the reclaimer acquired. It should be noted that this capacity does not include a substantial amount of commercial/industrial scrap grinding and compounding capacity. An estimated 72% of non-bottle rigid plastic reclamation capacity was utilized in 2013. Recycled non-bottle rigid plastic is commonly used in automotive applications, crates, buckets, lawn & garden products and pipe, as well as in ﬁlm and sheet. Other uses include various consumer and household products, lumber and decking, and fence posts.

Film and Bags In 2013, a minimum of 53.9 million kilograms of postconsumer film and bags were collected for recycling, showing an increase of 23% compared to 2012. Commercial Clear Film had the greatest increase, mostly reported by export markets, but some by domestic reclaimers as well. Based on provincial data, curbside film collection continues to increase steadily, but there are discrepancies between the provincial data and what is reported by reclaimers and exporters. In order to report an accurate recycling total, Moore Recycling included some of the collection data from provinces along with the survey responses. The destination (e.g., domestic, export) of material is reported where possible, but because Moore Recycling was unable to get responses from all exporters, the destination of a portion of curbside film is unknown.

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Film By Source

Commercial Clear Film 44.0% Dirty Ag Film 0.1% Commercial Mixed Color Film Clean Ag Film 7.6% 7.9% Other Film Curbside Film 1.8% Mixed Film 30.9% 7.7%

Film By Source Year-over-Year (kgs) Year Commercial Commercial Curbside Film Mixed Film Clean Ag Dirty Ag Other Film Clear Film Mixed Film Film Color Film 2013 23,768,000 4,104,000 16,658,000 4,156,000 4,257,000 41,000 980,000 2012 15,681,000 5,468,000 14,395,000 3,117,000 4,257,000 64,000 762,000 2011 13,820,000 3,273,000 13,211,000 991,000 5,357,000 235,000 215,000 2010 13,537,000 7,103,000 12,371,000 NA 933,000 33,000 2,853,000 2009 6,869,000 6,371,000 12,210,000 NA 1,477,000 181,000 38,000 Beginning in the 2011 survey, Mixed Film was broken out into Commercial Mixed Color Film (no postconsumer bags) and Mixed Film (includes postconsumer bags, sacks and wraps). The amount of Commercial Mixed Color Film reported above for 2010 and 2009 was previously reported under Mixed Film and may include some postconsumer bags.

Commercial Clear Film is by far the most valuable film in the marketplace. This is clean PE film, including stretch wrap and poly bags, recovered by the commercial sector from transportation and other packaging. After Commercial Clear Film, the most valuable is Commercial Mixed Color Film, then Mixed Film, which includes retail or depot drop-off collected postconsumer bags and film. While the bag and film material collected at retail drop-offs from the public is much cleaner than film collected curbside and sent through MRFs, it also has color and varying consistency in quality, depending on the program’s quality control, that can reduce its market value. Clean Ag Film is from agricultural uses where it does not touch the ground; it is dry, with up to 10% contamination. Curbside Film and Dirty Ag film (ag film that has touched the ground and has up to 50% contamination) are harder to recycle because they require a wash stage or an end product that can handle the contamination. Fewer than 5 U.S. and Canadian companies are able to process curbside film. Processors of postconsumer material collected curbside continue to

Moore Recycling Associates Inc PO Box 1327 Sonoma, CA 95476 707-935-3390 707-935-1998! www.MooreRecycling.com 2013 Postconsumer Plastics Recycling in Canada 19 express concerns about contamination from glass (and other abrasive material) and non- polyethylene plastic. Nearly all reclaimers expressed concern about the presence of degradable film in the recycling stream. The data reported show a minimum of 43% of recovered postconsumer film is being processed by Canadian or U.S. reclaimers, down from 50% in 2012. U.S. reclaimers purchased 4.7% (2.5 million kilograms) of the film plastic recovered in Canada, the same percentage as 2012. Canadian reclaimers purchased almost 3 million kilograms of recovered film from the U.S. in 2012, compared to 5 million kilograms in 2012. The export market has historically been a major buyer of film coming out of the U.S. and Canada. In 2013, a minimum of 51% of the recovered film was exported overseas, up from 36% in 2012. This increase is due to more commercial film reported by exporters as well as more data available on the destination of curbside film in 2013. The main categories exported in 2012 were Commercial Clear and Mixed Color Film, Curbside Film and Mixed Film; very little material from the other categories was exported, according to the survey responders. The destination of 6% of the film recovered in 2013 is unknown, down from 14% in 2012. As noted, this is curbside film known to have been recovered, based primarily on provincial data.

Capacity and End Uses For 2013, Moore Recycling estimates the film and bag reclamation capacity in Canada at 53 million kilograms, just a slight increase over 2012; capacity utilization was 44% . The major end use for recycled film in Canada is new film & sheet, unlike the U.S., where the lumber and decking market continues to be the largest consumer. Additional end uses in Canada (and the U.S.) reported in 2013 are automotive applications, pipe, lawn and garden products and some injection- molded articles.

Foam In 2013 a minimum of 2.7 million kilograms of foam were recycled. Most of it, 2.5 million kilograms, was expanded polystyrene (EPS), predominantly from protective packaging for durable products. Sixty-seven percent of the EPS reported was processed domestically. The EPS total was up 1.5 million kilograms from 2012. Moore Recycling received better responses from domestic reclaimers in 2013, but there are still a number of companies that did not respond to the survey. Very small volumes of other foam categories were reported: Expanded Polypropylene (EPP) recycled domestically and Rigid Polyurethane and Other foam reported as exported overseas. EPS is recycled into fire protection products, crown moldings and decorative frames for mirrors, pictures and wall hangings. The use of densification equipment to compress foam has enabled efficient transport to markets in Canada, the U.S. and overseas. Sources of recycled EPS include commercial generators, depot operations (both municipal and private) and curbside collection programs.

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Due to the limited number of reclaimers responding for domestic reclamation of EPS, no additional information is available.

Conclusions Postconsumer plastic recycling reported for Canada was 311.5 million kilograms, an increase of 26 million kilograms from 2012. These numbers are conservative, but year over year the data continue to show the vast majority of the material collected for recycling in Canada is staying in Canada for reclamation and remanufacture. Support of sustainability and recycling goals in Canada has led to domestic markets for all plastic scrap types and a low dependence on the export market. This strong recycling infrastructure helped minimize the impact of the Green Fence on Canadian plastic recycling programs, although the Green Fence effort did provide some reclaimers the opportunity to improve the quality of purchased bales. The plastic recycling industry in Canada is strong and growing.

Additional Information The Canadian Plastics Industry Association provides resources to communities, businesses and consumers to assist in increasing awareness and education of the recycling of plastic packaging and diversion from Canadian landﬁlls. For information about plastics recycling, visit www.plastics.ca. For information on markets for postconsumer plastic, visit www.PlasticsMarkets.org and www.PlasticFilmRecycling.org.

The 2013 Postconsumer Plastics Recycling in Canada report has been prepared to provide information to parties interested in the recycling of plastics in Canada. This report is not designed or intended to deﬁne or create legal rights or obligations. CPIA does not make any warranty or representation, either expressed or implied, with respect to the accuracy or completeness of the information contained in this report; nor does CPIA assume any liability of any kind whatsoever resulting from the use of or reliance upon any information, conclusion, or options contained herein. The Canadian Plastics Industry Association sponsored this report.

This work is protected by copyright. The Canadian Plastics Industry Association, which is the owner of the copyright, hereby grants a nonexclusive royalty-free license to reproduce and distribute this report, subject to the following limitations: (1) the work must be reproduced in its entirety, without alterations; and (2) copies of the work may not be sold.

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