Revenue Drops 30% in 2023: Regulatory Measures and Recycling Certificates Needed to Combat Unfair Competition and Ensure Material Quality

by Marco Arezio

Low prices are threatening the plastic recycling sector. Although the volumes of recycled materials remained stable compared to 2022, selling prices have drastically fallen, resulting in a 30% reduction in revenue.

Presentation of the Assorimap 2024 Report

In Rome, the Italian Association of Plastic Recyclers (Assorimap) unveiled the 2024 edition of its report on mechanical plastic recycling, compiled by Plastic Consult.

Director Paolo Arcelli presented the data for 2023, highlighting that over 2.5 million tons of plastic waste were collected in Italy, of which between 1.3 and 1.45 million tons were recycled, a slight decline from the previous year.

Volume Stability and Revenue Decline

The data shows that in 2023 mechanical recyclers placed 784,000 tons of post-consumer recycled plastics on the market, a figure almost stable (-0.3%) compared to the previous year.

However, revenue plummeted by 30%, dropping to 780 million euros from one billion in 2022 (+18% compared to 2021). This decline is mainly due to the drop in selling prices of recycled materials, necessary to compete with the low prices of virgin materials and to counter low-cost regenerated material imports from India and China.

Traceability Issues and Unfair Competition

Imported materials often lack traceability data or real recycled content percentages, offering prices that local producers cannot match. This situation has impacted the balance sheets of the 75 mechanical recycling operators, the backbone of the sector.

Proposals for New Regulatory Tools

Assorimap welcomes the introduction of a safeguard clause in the new packaging regulation, which would require non-EU suppliers of recycled plastics to comply with EU standards, thus preventing unfair competition in anticipation of the imposition of minimum recycled content percentages in packaging.

The association also proposes implementing traceability and certification systems to ensure the origin and quality of recycled material, crucial especially for materials intended for food contact.

An innovative idea is the creation of 'Recycling Certificates', which would include CO2 emission savings compared to virgin material production, supporting this activity through a trading system similar to white certificates for energy efficiency.

Institutional Support

Patty L’Abbate, vice president of the Environment Commission in the Chamber of Deputies, expressed her support for the recycling certificates proposal, emphasizing the need to combat greenwashing and promote a serious circular economy. She promised to bring companies' requests to the Ministry of Environment to improve plastic waste management.

Additional Report Data

According to Plastic Consult, the sector includes 355 operators involved in the collection, sorting, and recycling of waste and industrial scraps, 230 of whom produce regenerated granules or flakes, as in the case of rPET. Among these, 75 are 'pure' recyclers, producing granules from mechanical recycling of post-consumer waste.

The most recycled polymer is polyethylene, representing 46% of the total, followed by PET at 25%. Polypropylene and mixed polyolefins follow with less than 10% and 16%, respectively. Other polymers collectively account for less than 5%.

Production Breakdown by Application Sectors

Production is predominantly destined for packaging, which absorbs 40% of the total volumes, mainly thanks to PET. The pipe sector follows with 12%, and other flexible applications with less than 10%, surpassed by construction and building. Agriculture, household items, and gardening products complete the list.

Conclusion

Including all recycling operators, such as grinders and integrated processors, total volumes of post-consumer recycled plastics are estimated between 1.3 and 1.45 million tons. These data underscore the need for regulatory interventions and support to ensure the economic sustainability of the plastic recycling sector.