First, accession. Accession is where goods (say, a car engine) are affixed to or installed in other goods or property (say, a motor vehicle). The goods (the engine in the example) do not lose their identity when acceded (installed).

By contrast to accession (where two goods retain their separate identities), where one good is combined with another such that both lose their identity and something new is produced, that is called either processing or manufacture. Different again is commingling - comingling is where goods of the same type (say wheat) are mixed together (into a silo). Goods lose their original identity when processed, manufactured or commingled.

Loss of identity is clearly a question of degree. The PPSA helps here by providing that if goods lose their identity when processed, manufactured or commingled with other goods such that it is not commercially practical to restore the goods to their original state, then they are commingled, processed or manufactured¹.

The PPSA applies the same rules to situations where goods are commingled with other goods of the same kind (wheat into a silo), or processed or manufactured into another product. In each case the original goods lose their identity into a product or mass, so the issues that arise are largely the same.