Prices of high density polyethylene (HDPE) have tumbled 14 per cent in the UK since June, as lower demand is expected following legislation on carrier bag use.
Since October 5 large retail outlets in England have charged customers 5 pence for all single-use plastic carrier bags.
It has been estimated that demand for plastic bags in England will fall by nearly 57 per cent over the next year following the law. In Wales and Scotland, where similar laws already apply, carrier bag demand has fallen by almost 70 per cent.
HDPE prices have also been falling as a result of lower demand from packaging manufacturers and lower feed stock ethylene costs, said commodities data provider Mintec. HDPE is also used in the manufacture of chemical drums, jerrycans, carboys or demijohns, toys, picnic, household and kitchenware, food wrapping and cable insulation.
The majority of money raised from the 5p charge in Britain is earmarked for charities. In Wales, roughly £20m has gone to good causes since the scheme launched in 2011. The Department for Environment, Food and Rural Affairs (DEFRA) is aiming to stop unnecessary use of plastic carrier bags and the tonnes of litter they produce, which in turn damage wildlife.
Last year, 8.5bn plastic bags were handed out at British supermarkets, a 200m increase on a year earlier. At nearly 150 per person, the average shopper would see £7.50 added to their supermarket bill over a year, if charged for each bag used.
Figures collected by waste-reduction body Wrap, on behalf of DEFRA, show that the figure has steadily increased for the past four years, up from 6.3bn in 2010.
Campaigners argue that the bags blight streets, spoil the countryside, and damage wildlife, seas and coastline. The Treasury will pocket almost 1p for each one sold through VAT and estimates show it stands to make around £19m a year.