SK Chemicals Invests $98.4 Million in Recycled PET Market

SK Chemicals, based in South Korea, has signed a $98.4 million agreement to acquire a chemical recycling plant and polyethylene terephthalate (PET) production facility from China-based Shuye Environmental Technology.

With capacity of 70,000 metric tons/77,162 tons, the acquired recycling plant uses depolymerization technology to chemically break down plastic waste into monomers and produce recycled bis-hydroxyethyl terephthalate (BHET).

SK Chemicals’ newly acquired facility for producing chemically recycled PET, with capacity of 50,000 metric tons (55,116 tons), uses that recycled BHET in manufacturing rPET.

The deal has enabled the company to create a recycled-plastic value chain encompassing chemically recycled BHET, chemically recycled PET, and chemically recycled copolyester. Copolyester is SK Chemicals’ core business.

Through the acquisition, the company has gained a one- to two-year jump on domestic competitors in commercial production of chemically recycled BHET and products that use depolymerization technology.

"We will strive to become a leading company in the global recycled plastic market by pursuing global expansion and advanced recycling business models," Ahn Jae-hyun, CEO of SK Chemicals, said in a prepared statement.

SK Chemicals plans production operations in Europe, North America, and elsewhere.

Going forward, the company plans to work with new partners to expand its depolymerization capabilities domestically and to build global production infrastructure in Europe, North America, and other areas.

SK Chemicals also plans to ramp up development of depolymerization technology with recycled terephthalic acid (rTPA), an innovation in the recycled plastic industry. rTPA is a chemically recycled raw material that enables easy removal of impurities from waste PET and production of high-quality recycled plastic without additional production equipment.

The company cites a report from Wood Mackenzie indicating that the global market for recycled PET in 2022 was about 9.7 million tons and that most of the material was mechanically recycled.

The market for chemically recycled PET is expected to grow rapidly, forming a 4.6-million-ton market worth about $7.6 billion by 2030; growth has been slow to date, based on shortages of raw materials such as recycled BHET.

SK Chemicals plans to sell its chemically recycled PET domestically and internationally for food and beverage bottles and food packaging, leveraging the material’s transparency, appearance, and chemical stability.

The company also intends to enter high-value-added markets, including industrial specialty fibers, for which the use of mechanically recycled PET is challenging. Additionally, SK Chemicals will sell chemically recycled BHET to polyester manufacturers to produce recycled products.