A new composite IBC is about 18 kg of HDPE and 25 kg of galvanised tube steel, plus fittings and assembly. So its price is essentially a resin bet and a steel bet stapled together, and both of those moved in 2024.
What interests us — and what customers ask about every January — is how much of that reaches the used market. The answer is: less than you would think, later than you would think, and asymmetrically.
The year in two commodities
| Quarter | HDPE resin | Tube steel | New IBC | Used Grade B |
|---|---|---|---|---|
| Q1 | 100 | 100 | 100 | 100 |
| Q2 | 108 | 96 | 104 | 101 |
| Q3 | 119 | 91 | 109 | 103 |
| Q4 | 114 | 94 | 107 | 106 |
Resin rose 19% at its peak and steel fell 9%, partially offsetting. New container pricing moved 9% at its peak. Used Grade B moved 6%, and it did so in the fourth quarter — well after the input move had happened and partly after it had reversed.
Why the transmission is weak
Because used container supply has almost nothing to do with manufacturing cost. It is a function of how many containers industrial users are finishing with, which is a function of their production volumes, their contract cycles and their warehouse space. None of those care what resin costs.
Demand does respond, though. When new containers get expensive, buyers who were indifferent between new and reconditioned move toward reconditioned, and that bids up the used market. So the transmission runs entirely through the demand side, and it is damped by the fact that most used-container buyers were never going to buy new anyway.
The asymmetry
Used prices rise more readily than they fall. That is not price-gouging, it is inventory. When demand spikes, regional yards empty out and the remaining stock prices up because there genuinely is not more of it until autumn clearances arrive. When demand falls, the containers are already here and holding them costs yard space, so prices soften slowly rather than dropping.
The practical consequence for a buyer is that the seasonal cycle matters more than the commodity cycle. A 14% swing between January and April dwarfs a 6% annual commodity transmission, and unlike commodity moves it is entirely predictable.
What we expect going into 2025
Cautiously, and with the standard disclaimer that anybody forecasting resin is guessing with extra steps:
- Used Grade B to stay within about 5% of current levels through the first quarter, then the usual spring premium of 10 to 14%.
- Food-grade stock to continue tightening. Demand for it is growing faster than the supply of containers with documented edible prior contents, and that gap has widened every year since 2021.
- Rebottling to gain share against both new purchase and used replacement, because it is the option least exposed to steel and most exposed to our own labour.
- Stainless to remain lumpy and opportunity-driven. When a plant retools, a fleet appears; there is no trend line, only events.
The structural point underneath all of this
A used container's price is anchored to what it displaces, not to what it cost to make. That is an unusual property and it is why this market is stable relative to the commodities beneath it.
It is also why reuse is resilient as a business model. When manufacturing gets expensive, reuse looks better. When manufacturing gets cheap, reuse is still cheaper than manufacturing, because the alternative is always an object that already exists versus an object that has to be made. There is no commodity cycle in which building a new container costs less than not building one.