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Report for Asia and Eastern Europe

The EU’s new Packaging and Packaging Waste Regulation (PPWR) has introduced stringent recycled content requirements but also compliance measures for imports into the EU which may significantly impact rPET exports from Asia to Europe. Asian exporters now face the challenge of aligning with these strict standards to maintain access to the European market for customers looking at meeting minimum recycled content criteria.

The PPWR’s potential impact on the rPET sector underscores the importance of regulatory frameworks in shaping market dynamics. Asian markets could benefit from adopting similar mandates to stimulate local demand for recycled materials.

Last month’s INC-4 negotiations in Ottawa towards developing an international, legally-binding instrument on plastic pollution may present new opportunities for Asian recyclers through enhanced international co-operation and support mechanisms, potentially boosting the region’s recycling infrastructure and market competitiveness. Asian recyclers should actively engage in and leverage the frameworks and supports established in the wake of INC-4 to enhance their operational capacities and market reach.

Although freight rates from Asia to Europe are stabilizing, this normalization has yet to significantly benefit trade in recycled plastics such as rPET, rPE and rPP owing to ongoing market and supply challenges. The normalization of freight rates helps reduce logistics costs but, on its own, does not drive increased trade volumes for recycled plastics owing to persistent market oversupply and competitive pressures from virgin plastics.

The availability of high-quality rPET feedstock remains tight in key Asian markets such as Thailand, Indonesia and Malaysia, influencing both local pricing and export potential. Investing in advanced recycling technologies and improving operational efficiencies could help Asian recyclers mitigate high production costs and position rPET as a viable alternative to virgin PET.

Emulating the European model, there is a critical need for regulatory frameworks in Asia to encourage the use of recycled materials, aligning with global environmental sustainability goals. Improving the quality of collected recyclables and optimizing supply chain processes can help address the supply constraints of premium recycled materials and better meet international standards and demands.