Replies to post #38925 on Plastic2Oil Inc (PTOI)

[Rawnoc]

Here's how the real law of supply and demand works.

JBII says to TWO waste management companies:

Whichever of you two wants to give us plastic for free, we will accept it. Whichever of you two wish to keep paying $78/ton to get rid of it, knock yourselves out.

Any company that comes back and demands to be paid $1000 per ton will be given the royal middle finger, though no company would be dumb enough to do that of course.

[Scandle34]

my personal projections for JBII have them paying $15/bbl in plastic costs even for the waste. Supposedly they have contracts to get paid to accept the waste and in the short term it's credible. You are right, plastic feedstock will become a commodity some day IF they succeed...

$15/bbl is $80 per ton that they would pay for waste plastic by my model.

$1000/ton is nearly new plastic cost for some plastics:
http://www.ides.com/resinpricing/

Costs other than feedstock are $15 - that is supported by competitor data as well.
Sale price per bbl is well known - assume a low average of $75.

Commoditization of waste plastic can never exceed $65/bbl or it would kill off its own market. I submit the saturation point is half the "free plastic" profit margin or $30 per bbl.

That is about $160 per ton.

[stocker11]

think multi-year LOI's for free - a slight cost for us to take from you.