Bottle-to-bottle PET capacity is being built faster than collection can feed it
Food-grade rPET commitments assume a bottle recovery rate the collection network does not currently deliver.
The investment case for bottle-to-bottle PET has been read as a processing story: build food-grade capable capacity, sign brand offtake, run it. The capacity is arriving. The feedstock assumption underneath it is the part that has not been stress-tested.
Announced food-grade rPET capacity now exceeds the volume of bottle-grade PET the collection network reliably recovers. That single fact reorders who holds pricing power in this chain.
Why bottle-grade is not the same as PET
Aggregate PET recovery numbers are healthy, and they are not the relevant number.
Food-grade rPET requires bottle-grade input: post-consumer bottles, sorted clean, free of the thermoform and coloured fractions that are perfectly acceptable in fibre-grade output. The collection network recovers a great deal of PET. It recovers a much smaller quantity of consistently bottle-grade, documented, food-grade-eligible PET.
Capacity has been sized against the first number. It will be fed from the second.
Who this moves pricing power toward
When processing capacity is scarce, recyclers set terms. When feedstock is scarce, whoever controls verified feedstock sets terms.
That transfer is already visible in the spread between bottle-grade bales and mixed PET. Aggregators who can document purity and chain of custody are pricing separately from those who cannot, and the gap is widening rather than converging.
The part that makes this durable
Brand commitments to recycled content are contractual and public. They do not flex downward because collection underperformed. That puts a hard floor under demand for food-grade rPET regardless of what the collection network does, which means the shortage resolves through price rather than through demand destruction.
For a recycler without contracted feedstock, input cost is therefore set by other people's contracts. For an aggregator who can prove what is in the bale, this is the strongest negotiating position the segment has had.