US Plastic Recycling

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Plastic Recycling Industry: Trends

Plastic recycling has been a hot issue in the US, especially after China's ban on accepting plastic waste. A couple of trends in the plastic recycling industry in the US have been detailed below.

Plummeting Recycling Rates

  • The recycling rate of plastics in the US was at its peak in 2014 (9.5%) and it has been decreasing ever since. The weight of plastics recycled in 2017 totaled 3 million tons, which was a decrease of 5.4% as compared to 2015.
  • Even though almost everyone is aware of the plastic waste crisis, especially after China's ban on accepting plastic waste in 2017, no significant steps have been taken to increase the recycling of plastics, which can not only put plastic waste to good use but can also reduce the generation of virgin (newly made) plastic.
  • Company executives at a recent plastic industry conference also agreed that something should be done in regard to the increasing plastic waste crisis. Garry Kohl, an executive at Pepsico, said, "All we hear is 'you’ve got to get rid of plastics'."
  • Despite the worsening crisis, many companies, including Chevron, Shell, Dow, Exxon, Formosa Plastics, Nova Chemicals, and Bayport Polymers, are either expanding old projects or constructing new plants. The total number of these plants reaches as many as 700. This is fueled by the price drop in oil and gas prices, which translates to the decreased price of plastic production.

Companies Promoting Plastic Recycling

  • The news is not all gloomy when it comes to plastic recycling in the US. Many companies have pledged to recycle their own waste and to reduce plastic waste.
  • Estee Lauder, Intel, Accenture, Texas Instruments, and Eaton are companies that recycle over 85% of the waste they generate.
  • Apart from that, these companies "have made a strong commitment to environmental practices by establishing environmental management systems that include objectives, targets, monitoring and measurement, audits, training, performance records, etc." They also "received external certification (including to the ISO 14001 standard) of their environmental management systems across the majority of their facilities."
  • Other than that, companies like Starbucks, Taco Bell, and Tempo Plastics have undertaken initiatives like the recyclable lid and pouches, although some say that they may not be of much help.

Research Strategy

In order to identify trends in the plastic recycling industry in the US, we have leveraged information from credible sources and recognized the latest trends in the industry. We have backed our claims with multiple resources in order to add credibility to our claim. We have also made sure to stick to sources that either address the industry specifically in the US or are also relevant to the US if they address the state of the industry globally.
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Specialty Chemical Companies

Eastman is currently developing its own plastic recycling programs while Dow is a participant in existing recycling programs. Additional details of these programs are below.

Eastman

  • Eastman, a specialty chemical company headquartered in Kingsport, Tennessee, has two of its own recycling programs in progress.
  • The first recycling program, which will be performed in a new building that is expected to be completed by 2022, is called "Advanced Circular Recycling." It will "perform chemical recycling on a broadly mixed stream of polyester-family polymers using a process called methanolysis."
  • This recycling process will break down durable polyester plastics and "unwanted PET" that is not suitable for drinking bottles into dimethyl terephthalate (DMT) and ethylene glycol, of which "virgin polyester is made."
  • These basic monomers that result from methanolysis will be used as intermediates for the company's co-polyester production, including Eastman's "Tritan plastic, used primarily for consumer housewares; Eastar for packaging; and the Glass Polymer for cosmetic packaging."
  • The second recycling program at Eastman is called Carbon Renewal Technology and it is a process that will take in a variety of mixed plastics and "break them down into the basic chemical constituents of carbon monoxide and hydrogen" to create syngas.
  • Syngas, which is considered the "key to packaging sustainability," is used by Eastman to "create the acetate components of its Treva engineered bioplastic."
  • Currently, Eastman has to use fossil fuels to create syngas, but the new recycling process will allow its Treva plastic to be more sustainable. Items such as "ophthalmics, cosmetics, electronic display applications (lenses and covers), electronics and housings, and wearable devices and headphones" are made from Treva.
  • Eastman does belong to the Association of Plastics Recyclers.

Dow

Part
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Part
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US Plastic Recycling

The recycled plastics market in the US will grow to $8.44 billion by 2025. Some helpful insights that develop an understanding of the US market, as well as a detailed explanation of our estimate, can be found below.

US Recycled Plastic Insights

  • The recycling of plastics has gradually increased in the US over the past few decades, however, it reached the apex in 2016 when the total weight of recycled plastic reached 3.24 million tons, after which it declined to 2.96 million tons in 2017.
  • The US had been sending much of its plastic waste to China for recycling, however, China recently stopped accepting waste for recycling.
  • After the China ban, only about 56% of the total amount of plastic waste that the US once sent to foreign countries is now being accepted.
  • European countries recycle up to 40% of their plastic waste, whereas the US recycles only 10%.
  • Major barriers to the recycling industry in the US are the high cost of recycling as opposed to virgin (newly made) plastic and a lack of recyclers.
  • After China has stopped accepting plastic waste, the US sees recycling as the way out of generating more waste.
  • Companies in the US "are using recycled plastics in a wide range of applications such as the manufacturing of FDA approved food packaging plastic containers, bottles, closures, jars, engineered pumps, sprayers, and caps."
  • Small and large companies in the US are aiming to increase the use of recycled plastic for their products. Nestle Waters North America and the Unilever Group are some examples.
  • Polyethylene Terephthalate (PET) is the largest segment of recycled plastics.
  • North America is the current leader in the use of recycled plastic "with the highest per capita plastics consumption providing an opportunity for recyclers."

Research Strategy

In order to determine the growth of recycled plastics in the US, we started our research by looking for industry research reports specifically for the US. Failing to find any US-specific reports, we shifted our focus on determining US growth through publicly available information. In that regard, we found some research reports for the global recycled plastics industry and leveraged those to arrive at an estimate for the US market. The details of our calculations can be found below.

Calculation

  • As per the latest reports, the global use of recycled plastic is expected to grow at a CAGR of 6.8% and will reach a value of $66.73 billion by 2025.
  • Using the CAGR and the projected value, the current value can be calculated as follows:
Future value (2025) = $66.73 billion
CAGR = 6.8%
Current value = Future value / [(1 + CAGR)^(No. of periods)] = 66.73 / [(1+0.068)^(5)] = $48.02 billion
  • The recycled plastics market in the US was valued at £3.5 billion in 2016 and expected to grow at a CAGR of 6.5%. These values can be used to calculate the current value of recycled plastics market in the US as follows:
Past value (2016 / pounds) = £3.5 billion
Past value (2016 / USD) = 3.5 * 1.35 = $4.725 billion
CAGR = 6.5%
Current value = Past value * [(1 + CAGR)^(No. of periods)] = 4.725 * [(1 + 0.065)^(4)] = $6.08 billion
  • Using the current global and US values, we can calculate the future value for the US as follows:
Current US value = $6.08 billion
Current global value = $48.02 billion
Ratio of global to US = 48.02 / 6.08 = 7.9
Future global value = $66.73 billion
Future US value = Future global value / Ratio of global to US = 66.73 / 7.9 = $8.44 billion
Sources
Sources