Plastics recycling market remains in a slump

The plastics recycling sector remains under pressure from low demand and prices, at the same time as climate protection ambitions are facing political headwinds. Meanwhile, officials in Brussels are pushing ahead with the digitalisation of the waste transport system.

Conditions remain tense in the plastics recycling market. Prices for recyclates such as HDPE, LDPE, PP and HIPS have remained consistently low over recent months, with no sign of a recovery in demand. As the summer holiday period begins, order volumes from converters are expected to dip even lower, likely putting additional pressure on prices. Although recycling capacity has doubled since 2018, it has stagnated since 2022; indeed, both processing volumes and demand are continuing to lag behind available capacity. For the plastics recycling sector, this means little prospect of recovery at present; the market remains in a slump, with stagnant prices and a lack of economic momentum.

The European Commission has taken the latest step towards digitalising and simplifying cross-border waste shipments within the EU. With the introduction of the new Digital Waste Shipment System (Diwass), Brussels aims to make all EU waste shipments fully digital from May 21 next year. This central system is intended to reduce administrative burdens and significantly improve traceability and transparency in waste flows. Diwass will serve as a European digital hub via which national authorities and businesses can securely exchange information. The system will include notifications and consent procedures for waste shipments, including so-called “green list” waste. It also aims to enhance enforcement, as inspections will become more effective.

According to the European Commission, Diwass will help strengthen the market for secondary raw materials and support the circular economy by ensuring waste reaches the most suitable recycling facilities in the EU more efficiently.

The EU’s climate ambitions are coming under mounting pressure. Support for the Green Deal has weakened since the European Parliament elections in June 2024, and earlier plans appear to be faltering. At the EU summit in late June, the review of the Green Claims Directive - which would require companies to substantiate environmental claims through independent verification - was unexpectedly halted. Meanwhile, French President Emmanuel Macron called for a reassessment of the 2040 climate targets to better align them with European competitiveness. Largely absent were the social support plans that member states were expected to submit to assist low-income households with the green transition; only Sweden submitted a plan on time.

In this increasingly hesitant political environment, a unified European course remains uncertain. This is offering little relief for the plastics recycling industry, which continues to struggle with low demand and increasing pressure from virgin material.