Defining moment for plastics recycling amid huge demand

Sky-high freight rates, uncertainties in trading due to enforcement of the new Basel Convention amendments, extended producer responsibility, and design for recycling were among the key topics discussed at the plastics session during the latest BIR convention.


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Plastic
 
June 4 2021
 
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After a very difficult 2020, the recycling market has picked up very strongly this year with a “huge demand” for recycled materials over recent months and “very high prices” as well as difficulties in fulfilling supply obligations, observed the Plastics Committee’s Chairman Henk Alssema of Netherlands-based Vita Plastics in his opening comments.

With anticipated regulation requiring recycled materials in new products the demand will only increase. Also considering that end producers and brand owners are accelerating their efforts in this direction, there will be a rise in demand and with the current shortages on the market, what would the situation be when the drive towards circular economy picks up speed, Alssema pondered.  

Responding to his comment, Committee board member Sally Houghton of the Plastic Recycling Corporation of California said, “I think we’re in a very luck position. I think we are in a position we’ve been hoping we would get to in terms of demand and markets.

“Here in California, we are working very hard to increase our recycling rate, the quality of the PET bales that we collect.” She said there’s also a move towards collection of thermoform packaging so they would be an additional feedstock possibly for the PET market. “As with everything in the recycling industry, innovation and technology is coming along behind. I think it’s now up to the industry to show its innovation.”      

A salient example of brand-owners’ growing commitment to recycled content in their products was provided by guest speaker Eelco Smit, Senior Director within the Group Sustainability team at Dutch-based multi-national Philips. His business had set itself the target of quadrupling its use of recycled plastic to 7600 tons by the year 2025; already, for example, 95 percent post-consumer polypropylene content had been incorporated into vacuum cleaner housings and more than 75 percent recycled plastics into the non-food-contact parts of an award-winning coffee-maker.

According to Smit, large brands sought “security of supply,” but most would prefer to leave recycling in the hands of existing experts rather than to build their own processing plants. Indeed, he saw brands that are “willing to invest in new technologies” as a “big opportunity” for recyclers to either “scale up or start up.”

Alssema underlined the need for increasing volumes of recyclables, also pointing out quality issues and the fact that a lot of materials were ending up in incineration plants or landfills as they were not recyclable. But to improve the supply of raw materials to the industry and for a circular model in future, what can we do as an industry, and should manufacturers take necessary action “or do we take that responsibility together?” he asked.  

It’s a joint responsibility, noted Smit. “Clearly there’s a responsibility for brand owners. We put the products and the packaging on the market, so there’s a clear obligation there for us.” He said there is a responsibility for governments too. “There’s still a lack of proper EPR legislation around the world.”  

Many countries do not have a proper system in place to get all stakeholders to work together to set up the recycling systems and make sure the financing is in place to properly function; and there’s an obligation for the recyclers to step up to be able to be ready for any increase of materials and meet an increase in quality requirements, Smit remarked. There is a need to make sure that the materials that come out of recycling schemes meet the necessary quality requirements for producers to be able to use them in their products, he added.  

Dr. Steve Wong, CEO of Fukutomi Recycling Ltd and Executive President of China Sustainable Plastics Association, highlighted supply issues created by the Basel Convention plastic scrap amendments introduced at the start of this year. “In the Far East especially, I don’t think there will be enough recycled material for recycled content purposes,” he observed.

In a further contraction of opportunities for exporters, Turkey was to ban imports of “waste, parings and scrap of ethylene” - generally consisting of LDPE and HDPE - with effect from July 3 this year. Turkey had become an important outlet for EU member states, with volumes soaring from 22,000 tonnes in 2016 to 447,000 tonnes in 2020.

Responding to the contention that Turkey’s decision would intensify the pressure within Europe to recycle plastics in the country of origin, Max Craipeau of China-based Greencore Resources Ltd expressed the belief that this could lead to a significant increase in flows - particularly of the lower grades - between Western Europe and processing plants in Eastern Europe.

Another factor for exporters had been what Alssema described as the “terrible” conditions in the shipping market, characterised by “container shortages, high costs and unreliable services.” In response, global logistics expert Theo van Ravesteyn, Non-executive Chairman of MSC Nederland, explained that the container shipping industry had been locked in a repeating “boom-or-bust” cycles for three decades, going on to express doubts as to whether major players would exercise the necessary discipline to break this cycle.

On one point, however, Van Ravesteyn was certain: shipping rates might fall a little but there would be no return to the really low levels of previous decades. “Those days are over,” he remarked.

 

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