BIR World Mirror on Plastics – Quarterly Report May 2026: Middle East conflict turns plastics recycling market upside down

A concise summary of the BIR World Mirror on Plastics – Quarterly Report May 2026. Full version with detailed market reports available in the Members Only section of the BIR website.

After two years in which cheap virgin material has severely dampened recycling prices, the conflict in the Middle East has turned the market on its head, according to the latest World Mirror publication from the BIR global recycling organisation’s Plastics Division.

Demand and pricing for recycled material have risen sharply in many instances. Although price increases for recyclates have been less extreme than those for virgin materials, gains of 20% to 30% have been observed. And even with a relatively rapid resolution to the Middle East crisis, it is widely believed that it may take up to a year for supply chains to stabilise and for price levels to normalise.

Converters and brand owners who had previously abandoned or downscaled their commitments to use recycled material are now showing significantly more buying interest to help them manage the cost and supply risks they currently face. Members of the BIR Plastics Division have been quick to press home the message: if brands support recycling only when a crisis arises, then capacity will disappear such that recycled supplies will be less freely available when the next disruption comes along.

Demand is currently structurally exceeding supply, with many companies electing to stockpile raw materials in this uncertain environment. With customers’ focus shifting towards security of supply, there is a growing willingness to enter into long-term agreements for recycled materials. However, scaling up production to meet current demand is not straightforward given the significant reduction in capacity over recent years owing to closures and consolidation.

In Spain, a deposit, return and refund system will become mandatory from November and a tax of Euro 0.45 per kg of non-recycled plastic will remain in place on manufacturers and importers. These measures are aimed at stopping the price differential that exists in stable market situations between virgin and recycled plastic, the latter being more expensive owing to implicit management costs.

From Scandinavia, it is confirmed that disruption within the primary plastics market has pushed processors to seek more reliable or cost‑stable alternatives, leading to an increased number of enquiries from processors about availability and pricing of recycled materials in a bid to hedge against volatility in virgin supply. PE recyclate prices have increased moderately while other polymers - such as polypropylene and certain engineering plastics - are seeing milder upward price pressure.

In Asia, rPET bales, flake and pellet have recovered from the very low price points seen in recent times but, in broad terms, are only back to the levels of May last year. Currency is also supportive for exporters to China as a stronger RMB against the US dollar is improving purchasing power for dollar-denominated commodities.

The recycled plastics market in the Middle East has shifted from being relatively balanced to a tighter, more volatile state because of petrochemical disruption linked to the Iran conflict and logistics pressure around the Strait of Hormuz. At the start of 2026, recycled HDPE and PET prices in the Middle East were increasing only slightly because supply and demand were still relatively balanced but prices for both virgin and recycled plastics are rising much faster now, with some reports mentioning virgin PE and PP price gains of 30-50% in affected markets.

As in other regions, converters and packaging companies in the Middle East have shifted towards the use of recycled pellets and flakes wherever technically possible.

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With contributions from its members, BIR publishes periodical commodity reports under the label "BIR World Mirror". These detailed reports exist for Non-Ferrous Metals, Ferrous, Stainless Steel / Alloys, Paper, Plastics and Latin America and provide BIR members with up-to-date information on the respective commodity or market segment.

The report on Non-Ferrous Metals appears once every two months, whereas Ferrous, Stainless Steel, Paper and Plastics are published quarterly. Latin America is covered twice per year.