Recycled plastic: boost from oil price rises, but the crisis remains

Positive signs for the Italian recycled plastic industry, after months in which the structural crisis that has been gripping the sector for some time, crushed between high energy costs and fierce non-EU competition, has led to closures and production reductions. A critical situation that has also been exacerbated by the effects of US tariffs, which since the end of last year have diverted Asian flows destined for the US to Europe, including Italia. Now the Gulf crisis has pushed up oil prices, with price increases on the plastics supply chain from there. And consequently benefits on the one that produces recycled material, which has become competitive again. "The rise in the prices of virgin plastics and the difficulties of procurement have mitigated the invasion of product at reduced prices, with the restart of the domestic market, including the recycled one, which has risen in the last month," explains Walter Regis, president of Assorimap, the national association of plastics recyclers and regenerators that represents 90% of the Italian supply chain.

However, the breath of fresh air is not enough to lift an industry that has seen operating profits plummet by 87% since 2021, from EUR 150 million to just EUR 7 million in 2023, and close to zero in 2025. With 'conflict-related movements leading to an increase in profits, but then we will see. In any case, this is a short period, which will probably come to an end. We cannot be tied to this war in order to work. That of our companies is an open, structural crisis and demands answers that Europe and Italia are not coming up with,' Regis continues. This is why, on 15 April, the association will be in Brussels with Plastics Recyclers Europe, the association of European recyclers, and in a dedicated conference it will tell how an unprecedented sector crisis has managed to affect an experience of excellence in mechanical recycling such as the Italian one.

The extent of capacity loss is a phenomenon that affects the whole of Europe: according to the latest estimates, some 40 plants on the continent have closed since 2023, with recycling capacity eroded by almost 1 million tonnes in 2025 alone. The Italian industry experienced a stalemate in November last year. As Regis also recalls, 'with recycling at a standstill, thus clogging the upstream chain of sorting and compacting plastic waste, the Italia system was good at managing material flows and stagnation, so much so that citizens were unaware of the criticality'. Today, the situation is patchy, as the president himself defines it: "Companies, either for multi-year contracts or for integrated collateral activities, have maintained their production capacity, which can however be kept at 50%, 20% or zero. There have been no further closures of important companies: not living from recycling alone they have managed to limit the damage. For the small ones the moment remains very complicated'.

Among Assorimap's proposals to try to solve the Italian recycled plastic crisis is the identification of white certificates linked to the recycled material that certify its energy savings and a carbon credit for the related CO2 savings. 'They represent the recognition of an environmental value that guarantees companies an economic return,' Regis emphasises. Then there is the idea of anticipating the EU obligations (contained in the Ppwr), currently for 2030, to include a recycled plastic content in packaging. "This is an important signal to make the market understand the trend and to start defining a perimeter on which industries can develop investments". In a context of defending European production with controls and sanctions on non-compliant imports.

These proposals had been taken to several ministerial tables, the latest in December. 'We trust that there is ongoing work on the issue. At the moment, however, we have no news,' concludes the president of Assorimap.