Europe's ruin. Consequences for virgin raw material producers, recyclers and converters

Virgin Raw Material Producers:

• Competitiveness Issues: The European plastics industry has long warned about severe competitiveness challenges due to excessive European regulation and a flawed energy strategy.
• Main Challenges: Bureaucracy Costs: High administrative costs burden the industry. Energy Costs: Elevated energy prices further strain producers. Decline in Demand: The approval of the PPWR (Packaging and Packaging Waste Regulation) and the increased consumption of recycled materials have led to a reduced demand for virgin materials. Competitive Imports: Imports from outside Europe at highly competitive prices exacerbate the situation.
• Point of No Return: The industry has reached a critical juncture, with plant closures and investments in chemical recycling being the only potential mitigations for the drop in demand for virgin materials.

Recyclers:

• High Expectations: Europe has set high expectations for the use of recycling, prompting the industry to prepare by expanding production capacities.
• Difficult Situation: Despite preparations, recyclers face significant challenges: Incomplete Legislation: The approved legislation is seen as incomplete and unambitious, arriving too late to be effective. Quality Standards: In some applications, recycled materials do not meet the necessary quality standards, particularly in the food sector (except for PET). Cheap Imports: The influx of cheap recycled materials from other parts of the world makes it difficult for local recyclers to compete, putting pressure on their margins.

Converters:

• Demand Drop: The anti-plastic legislation has led to a decrease in demand for plastic products.
• Competitive Imports: Converters also face competition from imports at highly competitive prices, further challenging their market position.