Plastic recycling in Europe – Challenges and objectives

European plastic recycling is forecasted to rise

The European plastics recycling is expected to grow significantly in the next five to ten years. Governments and major brands are working continuously on optimizing the circularity of plastics value chain. The management consulting company, McKinsey & Company, have conducted a survey of 57 companies across 12 countries in Europe. These companies represent an approximate of 20 to 30 % of installed mechanical recycling capacity in Europe.

The survey confirmed, McKinsey’s hypotheses: plastic recycling industry is not yet thriving, recyclers struggling with the lack of product standardization, volatile demand and inefficient sortation processes.

European Union set a target in 2017 to recycle 50 percent of plastic packaging by 2025 and 55 percent by 2030. Brand owners have pledged to improve plastics usage and recycling by reducing material in product and packaging; Using recyclable materials, increasing recycled content and increasing organic waste-based content.

Chemical recycling – an alternative to mechanical recycling?

The survey conducted was focused on companies practicing mechanical recycling, as it is the most established method to process raw materials. However, in the past years there was a surge of chemical recycling technologies, which breaks plastic polymers, making it possible for plastic waste to be converted into new plastic resins or other petrochemical products. It is proved to be useful as an outlet for low quality plastic waste that can’t be processed.

The opinions of surveyed mechanical recyclers on chemical recycling distinguished, a quarter of these companies views chemical recycling as a potential competition for raw materials, while 35 percent of them consider it as a potential of complementing the recycling industry. Yet, the majority of companies were skeptical on the ecological footprint and economic viability. Chemical recycling technologies entered the commercial market relatively recently, so there is room for big potential in the future.

What challenges the European recycling market?

An additional survey was conducted in April 2020 to find out how the companies were affected by the pandemic. While most of the companies (80%) felt affected by the covid-19, only 33% felt on hold and in danger and 60 percent said that it slowed them down, but they don’t see a long-term threat.

The crisis caused by pandemic also had an impact on decreasing the price of oil, challenging the recycling industry, as prices for new virgin plastic will decrease as well, however half of interviewees didn’t show concern about it.

When companies were asked on how the industry can improve its attractiveness the top answers were government initiatives and shift in the consumer mindset and their sorting of the recycling material.

What are the Europeans aspirations for changing the recycling market?

• Improve the quality and availability of the recycling materials– Several approaches can help promote the use of standardized materials. One is packaging differentiation that can allow consumers easy distinguish the resin types. Another is furthering the use of flexible packaging in circular economy, which is the goal of a collaborative initiative of companies and associations called CEFLEX
• Target incentives to enable closed-loop recycling – Today, most of the recyclers practice open-loop recycling, meaning that the waste materials are recycled in the other typed of products. Closed-loop recycling intends on recycling the product back into itself.
• Make the industry more economically attractive and investable –Economically, the best way to improve collection is for consumers to separate their plastic waste from other forms of waste and empowering them to reduce the contamination and mixing the types of plastic. Also investing into technologies that can improve the quality of recycled materials, this will make recycled plastic more competitive with virgin plastics.
• Create a common marketplace for feedstock and products – That’s where us, Waste-Outlet and other marketplaces step in. In order to improve market liquidity and trade transparency of waste materials. There is a gap between the demand and supply on the market due to the need of more actionable mechanisms of the recycling market.

Read the full article on : https://www.mckinsey.com/industries/chemicals/our-insights/the-european-recycling-landscape-the-quiet-before-the-storm