NEWS | MARKET STUDY
Plastics recycling capacity needs to double in Europe
China’s waste import ban and new EU targets have put pressure on Europe’s plastics recycling industry to greatly increase reprocessing volumes. AMI Consulting’s Elizabeth Carroll has analysed issues facing the sector in a new study
Sustainability is ever more relevant in today’s society and plastics waste is at the forefront of many debates and discussions around the drive towards a more circular economy. Accord- ingly, the issue of waste is increasingly on the agenda of governments around the globe, with new policies and legislation bringing new targets for the recycling of plastics. Capturing the value of plastics through reuse and recycling not only helps retain a product which currently primarily derives from the earth’s finite natural resources, but also helps to prevent the leaking of plastic waste into the ecosystem and to create a circular economy. Because of this the plastics recycling industry is gaining growing attention. Dealing with waste plastic has generally been
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seen as a problem to overcome, and not seen as an opportunity. Many countries around the world, therefore, have been export- ing their waste to others that are more willing to process it. Countries with lower standards for waste man- agement have been a market for disposal, a way to meet domestic recycling targets and reduce the need to send material to landfill, without having to necessar- ily improve the collection and sorting infrastructure. Partly because of the size
of the local market and partly because of a greater willingness to use recyclate, Asia and more specifically China, had, up until 2018, been the main recipient of plastic waste importing between 45-50% of global plastics waste. However, with the new Chinese ban on waste imports, Europe must find new ways to deal with
PLASTICS RECYCLING WORLD | September/October 2018
this waste. To put this into perspective, the EU col- lected 8.4 million tonnes of plastic waste in 2016, of which 1.6 million tonnes was sent to China. So, what is going to happen to this 1.6 million tonnes now? What must be prevented is the loss of this valuable asset. While industry and politi- cians alike debate and discuss feasible answers as to how to recycle it, landfill and incineration become the easiest way to dispose of it.
Profitability New national and European Union polices will require an increase in recycling capacity within Europe, which is generally seen by consumers and businesses as good news for sustain- ability. However, what is commonly forgotten is that plastics recycling companies are, in the majority of cases, commercial businesses that
rely on being profitable. The plastics recycling industry is a complex, dynamic segment with a varied supply stream and value chain. Therefore, with the prices of recyclate intrinsi- cally linked to the price of virgin resin, demand and the financial viability of the plastics recycling is often subject to fluctuations in raw material prices. Accordingly, in order to meet new recycling targets, the mechanical recycling industry must both expand existing capacity and maintain profitability. Current output capacity
of the recycling industry in Europe will need to more than double by 2030 to meet targets. One of the challenges in growing capacity is increasing the demand for the recyclate produced. Currently, with the price of oil remaining low, the decision to use
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