US & Global Economic Impact Analysis and Forecasts

Freedonia analysts and economists are sharing their insights on how major events are impacting different parts of the US and global economies.

Reduced Plastic Recycling Activity & Limited Infrastructure Forces Companies to Get Creative to Source Post-Consumer/Post-Industrial Recycled Content

Recycling – once seen as perhaps the easiest way for Americans to act in an environmentally friendly manner – has become a challenge for millions of Americans. First, in 2019, China banned most imports of plastic scrap. This caused communities across the US to curtail or cancel altogether their curbside recycling programs. Other cities and towns paid more to continue these programs, feeling that the benefits outweighed the costs.

Then, the COVID-19 pandemic hit. Communities across the US – seeing declines in revenues and mounting expenses on health and safety – again put curbside recycling on the chopping block as they looked for ways to economize.

One unintended consequence of this curtailment of recycling is that many businesses across the US use recycled plastics in their production processes. Plastic packaging suppliers and packaged consumer goods firms are core users of recycled plastics as many of them have stated goals to improve recyclability of their packaging, reduce plastic use, and increase use of recycled content. Decking and fencing manufacturers are also increasingly using reclaimed plastics as raw materials.

However, the reduction in the supply of reclaimed plastics has caused firms to try a variety of methods to ameliorate this problem.

  • AZEK Building Products, a producer of composite decking, fencing, and other building products, is partnering with packaging manufacturer Berry Global through which Berry will supply AZEK with post-industrial scrap plastic can be used to make plastic building materials.
  • Plastic recycling firms are promoting state legislative efforts that issue minimum recycled content requirements for plastic packaging sold in that state – thus spurring plastic packaging manufacturers to buy reclaimed plastics. 
  • Some recycling operations are expanding post-consumer capabilities, somtimes while making supply deals with firms that need the material. For instance, Alpla Werke Alwin Lehner – a packaging manufacturer – announced that it is investing $17.7 million in a high density polyethylene (HDPE) recycling plant in Toluca, Mexico. The company already operates a joint venture in the same city with Coca-Cola Mexico and Coca-Cola Femsa to recycle food-grade PET

As the US economy slowly moves out of its COVID-19 induced recession, it is expected that more plastic waste will be generated, and efforts across the US to reduce this plastic waste will rise, promoting a broad range of efforts to keep plastics out of waste streams.

For more information and discussion of opportunities, see The Freedonia Group’s extensive collection of off-the-shelf research including a variety of packaging industry topics, including Global Foodservice Single-Use Products, COVID-19 Economic Impact Report: Retail Bags,Global Single-Use Plastic Packaging Regulations,Foodservice Single-Use Products, and Retail Bags, as well as Global Foodservice. Other related titles are available from Packaged Facts’ food- and beverage-related reports, including Food Carryout & Delivery as well as the companion report with timely consumer insights from our in-house survey capabilities. Freedonia Custom Research is also available for questions requiring tailored market intelligence.

  Covid-19      Packaging