In today’s PET packaging industry, this concern lies at the heart of the circular economy challenge. In our Factory of the Future Packaging Industry Guide 2025, Holland Colours highlights that recycled PET continues to trade at a premium over virgin PET across most global markets, driven by higher costs for collection, cleaning and reprocessing. Meanwhile, virgin PET benefits from low-cost fossil feedstocks and mature petrochemical supply chains, making it cheaper to produce.
The Cost Gap Explained
The cost difference between rPET and virgin PET lies mainly in their supply chains and production processes. Producing food-grade recycled PET requires strict contamination control and energy-intensive recycling steps such as solid-state polycondensation, making it more expensive than virgin resin manufacturing.
At the same time, demand for high-quality rPET flakes has surged as global brands pursue sustainability targets, further driving price increases. In Europe, the 25% recycled content rule for PET bottles has intensified demand and cost, while in China, the opening of 17 new virgin PET plants in 2023 lowered resin prices and weakened demand for recycled materials.
As a result, the rPET market often carries a higher price tag, and this cost gap varies sharply between regions with inconsistent or various circularity mandates.
Oil Prices and Policy Influence
The price gap between recycled and virgin PET is also closely linked to global oil prices. As the guide explains, virgin PET continues to benefit from low-cost fossil feedstocks, as declines in crude oil prices directly reduce production costs and make virgin resin more economically attractive than rPET. When oil prices fall, virgin PET becomes more competitive, while high oil prices narrow that gap.
Trade policies further shape this dynamic. To stabilize pricing, the European Commission imposed anti-dumping duties of 6.6–24.2% on PET imports from China in 2023, helping protect regional producers. In the U.S., however, imports of 52.5 million pounds of rPET scrap in January 2024 compressed local margins, showing how global PET market trends and trade shifts influence recycling economics.
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Bridging Cost and Circularity
Despite these imbalances, innovation and regulation are helping to close the gap. Under the EU Packaging and Packaging Waste Regulation (PPWR), by 2030, “all packaging must be recyclable based on Design for Recycling (DfR) principles”. This regulation pushes the entire value chain to rethink material use, processing efficiency and end-of-life management.
Technology plays a crucial role, too. Additives for recycled PET, such as Holland Colours’ ViscoBoost and CircStab, restore intrinsic viscosity and minimize discoloration during the recycling process, improving rPET quality and efficiency. As the guide highlights, advances in chemical recycling, additive technologies and digital traceability are enabling better performance and transparency. These breakthroughs are reshaping how sustainable packaging materials are produced and valued.
Conclusion
The price differential between rPET and virgin PET continues to be shaped by fluctuations in oil markets, evolving trade regulations and constrained feedstock availability; however, achieving a balance between costs and sustainability remains essential for the industry's long-term progress.
Innovation in chemical recycling, smart additives and strong regulations under PPWR are redefining how the industry achieves circularity without compromising on performance or profitability.
👉 Delve deeper into these industry shifts in our latest industry guide, where we examine how evolving global policies, market forces and advances in material science are redefining the intersection of cost and circularity in sustainable packaging.
