European Plastics Recycling Sector Faces Imminent Collapse, Capacity Loss Soars
Brussels – Europe’s plastics recycling industry is experiencing a severe crisis, with nearly one million tonnes of recycling capacity expected to be lost by the end of 2025, equivalent to the entire capacity of France, threatening the continent’s circular economy goals.
The decline has accelerated dramatically, with capacity lost in the first seven months of 2025 nearly matching all of 2024, and projected closures tripling compared to 2023. This loss of capacity weakens Europe’s independence in crucial resources and its standing in global markets. Several factors are contributing to the downturn, including an influx of unverified, low-priced plastic imports, high energy costs, decreasing demand for European recyclates, and excessive administrative burdens for recyclers.
A key issue is the lack of enforcement regarding imported plastics, where verification is often absent to confirm whether materials are virgin or recycled, or if they meet European regulatory standards. This allows cheaper, potentially non-compliant plastics to enter the market, undercutting European recyclers. Simultaneously, falling oil prices have made virgin plastics more attractive to converters, further reducing demand for recycled materials. The European Commission’s efforts to promote a circular economy are now at risk.
To address the crisis, industry stakeholders are calling for swift action from policymakers, including trade defense tools to protect against non-compliant imports, access to affordable energy, and streamlined permitting processes. Consistency in enforcing existing EU legislation, such as the upcoming PPWR, is also crucial. Officials state that a comprehensive response is needed to revive demand for European recyclates and prevent further closures, ensuring the sector can contribute to Europe’s sustainability objectives.
The EU is expected to discuss emergency measures at an upcoming environmental summit, with a focus on bolstering the competitiveness of European recyclers and safeguarding the future of the industry.
