Communicator
Insights |
2025/08/13 10:49 AM
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The Collapse: Project Cancellations, Bankruptcies, Shuttered Plants Far from steady progress, the past three years have delivered a torrent of closures, bankruptcies, and shelved investments. Major recycling operations—both mechanical and chemical—are pulling the plug, often after only a few years, and sometimes even before producing their first tonne of recycled product. A Continent-Wide Wave
This wave isn’t isolated. EUWID Recycling reports dozens of closures and receiverships across Germany, the Netherlands, France, and the UK—signals of a deep-rooted crisis. The Scope: Billions Invested—Hundreds of Thousands of Tonnes Gone Industry analysis suggests at least 600,000 tonnes/year of recycling capacity have vanished since 2023—a figure likely understated, considering bankrupt auctions, idle plants, and stillborn projects not itemized in public records.
Why the Recycling Renaissance Failed Why did all this money, all these policies, and such grand ambition crash so dramatically? The answer is found in the economics of plastics, energy, and global markets. Virgin Plastic: The Irresistible Competitor From 2023 onward, virgin plastic prices plummeted as mega-plants in China, the Middle East, and the US began pumping out vast quantities. Europe’s recycled plastics faced a relentless flood of cheap, imported virgin material. By February 2025, recycled PET averaged $750-800 per tonne more than virgin PET, shutting recycled product out of mass markets. Imports Add Insult to Injury Europe, meant to be the greenest market, found itself increasingly buying cheap, sometimes dubiously labeled “recycled” plastics from abroad—often without effective verification. Domestic recyclers couldn’t compete with imports made under looser standards, lower labor costs, and less expensive energy. The Energy Crunch Recycling, especially chemical, is energy-intensive. Europe’s natural gas price surge post-2022 made recycling electricity 3–4x costlier than in the US. Energy went from 15% to over 50% of operating costs; some German operators report 70% of costs are now electricity. Italy and Germany both saw recyclers shut simply because the utility bill made month-to-month survival impossible. Subsidies and Taxes: Not Enough, Sometimes Hurting More Public subsidies temporarily shielded recyclers from stark costs but couldn’t build businesses that last. The UK Packaging Tax, the Spanish tax on virgin plastics, the EU’s plastic tax (€0.80/kg on non-recycled waste) and other national fees on packaging raised costs for converters, reducing volumes. Grants like Re-Match’s in the Netherlands kept operations afloat for a season before insolvency struck. The EU’s Packaging and Packaging Waste Regulation (PPWR), which imposes new targets and strict reporting, arrived just as the industrial base capable of meeting those targets collapsed. Uncertainty around regulation, rapidly shifting standards, and policy delays chilled new investment. Chemical Recycling: Too Early for Profits Once marketed as a technological fix for “unrecyclable” plastics, chemical recycling remains dogged by technical obstacles and astronomical costs. Reports show most commercial chemical recycling plants have failed to break even (Ioniqa, Blue Cycle, Fuenix Ecogy, Mura, Suez-Saint Avold, Neste/Ravago—all shuttered or cancelled). A Downward Spiral: When Virgin Closes, Recycling Follows Economics don’t favor recycling when even virgin resin production itself is being curtailed. Dow, Sabic, LyondellBasell, and others are closing or mothballing crackers and polymer lines in the EU as profits evaporate. For recyclers, those same factors—depressed demand, high costs—make new investment suicidal. The Human & Environmental Cost These closures mean lost jobs—sometimes entire regions losing “green economy” hopes as plants shutter mere months after opening. In the UK, each Viridor and Biffa closure meant over 100 direct jobs lost, plus suppliers and logistics implications. Across Germany, the Dutch industrial belt, and France, engineers and operators have been left stranded by the implosion. Environmentally, it means less plastic recycled, more waste exported, and slower progress toward circular economy goals. In 2024, EU plastic waste exports rose 36% versus 2022; the continent was forced to send its problem abroad as recycling plants went idle. How Did It Go So Wrong? Ambitious European leaders thought that regulation, taxes, and subsidy would create an industry. Instead, they created a sector unable to survive outside artificial support, all while failing to acknowledge the fundamental economic disadvantage. The “subsidy trap” encouraged over-investment, triggering catastrophic losses for both private and public actors once market discipline returned. Will Recovery Come? Without radical changes in energy pricing, global competition rules, and technology, it’s hard to see a path back. Domestic demand is weak, policies are too volatile, and Europe’s cost base is increasingly uncompetitive. A handful of survivors may limp on, but the dream of a self-sustaining, export-driven European recycling industry is dead for now. The future may bring new technology, smarter deposit schemes, and regulatory clarity, but that requires confronting the hard lessons of this exodus: only market-viable solutions will last. And for now, the so-called circular economy remains just out of reach, as shuttered plants and bankruptcy filings mark the end of an era built on wishes, not on economic reality. This report was compiled from dozens of recent sources, including C&EN, ChemAnalyst, EUWID Recycling, Troostwijk Auctions, Argus Media, ICIS, Sustainable Plastics, Zero Waste Europe, Resource Recycling, Chemical Recycling Europe, LinkedIn industry posts, as well as European Commission and regulator reports, in addition to build on ppPLUS own market intelligence. |
Sustainability |
2025/06/02 04:44 PM
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Insights |
The legislation will officially come into force on Feb. 11, 2025. EU regulations become binding upon publication on the Official Journal. All member states are required to comply with the regulation. The PPWR will apply from August 12, 2026, 18 months after the regulation comes into force. The European Parliament approved the final PPWR text in November 2024. The document is available in all EU languages. The EU Parliament had approved a preliminary version of the legislation on April 24, 2024, with 476 votes in favour, 129 against, and 24 abstentions. That version of the text only included a version in English and hadn’t undergone the required legal-linguistic review. The PPWR includes packaging reduction targets (5% by 2030, 10% by 2035 and 15% by 2040) and require EU countries to reduce, in particular, the amount of plastic packaging waste. Under the new rules, all packaging, except for lightweight wood, cork, textile, rubber, ceramic, porcelain and wax, will have to be recyclable by fulfilling strict criteria. It introduces, as of 2030, a recyclability performance grade scale from A to C stating the extent to which packaging is considered recyclable, being 95% grade A, 80% grade B, and 70% grade C. The legislation includes provisions on recycling targets of 50% for plastic packaging by 2025 and 55% by 2030 and foresees recycled content targets for all types of plastic packaging, with the most demanding ones set for 2040 – including 65% recycled content for SUP beverage bottles, 50% for PET contact-sensitive packaging, and 65% for other packaging. By 2029, 90% of single use plastic and metal beverage containers up to three litres will have to be collected separately, via deposit-return systems or other solutions that ensure the collection target is met. Throughout the two long years after the first draft PPWR was introduced, the text has generated a lot of controversy. Some industry groups claim the legislation lacks ‘material neutrality’ by singling-out plastics, whilst others argue that secondary legislation will be required to make it work. |
News |
2024/10/23 12:40 PM
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Sustainability |
2024/07/29 07:27 AM
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