Outlook on the future of plastics recycling

To survive, the European industry must continue to innovate and develop solutions to its pressing challenges. However, successful transformation requires the support and guidance of policymakers alongside a broad range of stakeholders. A central solution lies in reorienting the industry towards a circular economy, where products and materials are designed for continuous reuse with minimal environmental impact and low carbon footprints throughout their lifecycle. Enhancing plastics recycling is therefore crucial to making the European industry both futureproof and competitive. This approach will improve resource efficiency, reduce environmental externalities, and strengthen the resilience of the European plastics sector by securing sustainable feedstock for its operations.

As a pioneer in plastics production and recycling, Belgium – particularly Flanders – demonstrates a strong commitment to innovation, sustainability, and the circular economy, aiming to lead by example. The region aspires to foster green growth where economic prosperity and environmental sustainability go hand in hand. The roadmap for plastics recycling, developed by Deloitte and commissioned by the Department of Work, Economy, Science, Innovation, and Social Economy (WEWIS) of the Flemish Government, presents a strategic vision to position Flanders at the forefront of the transition to a circular economy. The report proposes a data-driven ambition for 2050 and outlines concrete actions to realise the aspirations in relation to plastics and plastics recycling. Furthermore, it highlights the critical role of every link in the plastics value chain – spanning production, conversion, and waste recycling – in driving this interconnected circular transition.

By envisioning and analysing a scenario in which plastics are recycled and reused as feedstock for future-proof plastics production, a combination of mechanical recycling, polymer recycling, monomer recycling, and feedstock recycling will be essential to increase capacity and expand the range of plastic waste streams that can be recycled. Enhancing the economic viability of recycling is critical to scaling up these innovative technologies. To achieve the ambition, a range of initiatives is required:

1. Economic policy instruments should introduce financial incentives that encourage recycling at scale; 
2. Legal reforms must place secondary resources on an equal footing with primary resources and endorse the ‘mass balance’ principle, which governs how recycled content is allocated to materials in processes with multiple outputs; 
3. Simplifications of permitting procedures, waste shipment rules and registration processes are needed to establish a single European market for waste management, enabling resources to flow to the most efficient processes; and 
4. Structural measures should restore the competitiveness of European companies involved in plastics production, conversion and recycling.

By taking a leading role and driving the necessary changes within its own policy domains – while clearly articulating asks to other policymakers – Flanders can establish itself as a hub for plastics recycling in Europe and accelerate the continent-wide transition.

Building a Competitive Plastics Recycling Sector in Flanders

Plastics recyclers in Flanders and across Europe face strong competition from cheap virgin plastics, limited financing for recycling projects and risks associated with scaling new technologies. Large-scale investment projects – especially first-of-a-kind plants requiring substantial capital expenditure – struggle to secure funding due to uncertain legal and economic conditions. As a result, the progression of new technologies from laboratory to pilot and commercial scale is often delayed, hindering innovation and undermining Europe’s longstanding leadership in plastics recycling.

The industry is calling for an action plan to streamline industrial policy by addressing barriers such as waste legislation and permitting procedures. In order to be effective, such a plan should prioritise the harmonisation of EU regulations and advocate for technology neutrality, supporting mechanical, polymer, monomer, and feedstock recycling technologies alike. Furthermore, restoring a level playing field through stricter controls on non-EU products that enter the market to ensure compliance with European standards. The plan should enable European companies to compete effectively and maintain their presence in both European and internation markets.

¹Closing the European competitiveness gap
²CIS Plastics Price Reports food-grade rPET pellets and virgin PET

The recycling sector in Belgium and neighbouring countries has experienced a wave of bankruptcies, project cancellations, and plant closures. This sobering reality underscores the complex interplay of economic, regulatory, and market forces that have undermined the viability of many recycling initiatives. Despite strong intentions to promote the circular industry, geopolitical tensions and macroeconomic shifts have structurally weakened market conditions in recent years:

• Competition from cheap virgin plastics: Since 2023, the price of virgin plastics has plummeted due to large-scale production in China, the Middle East, and the US. This influx of low-cost virgin material has rendered recycled plastics economically uncompetitive. For instance, food-grade recycled PET prices have been reported to be $600-$800 per tonne higher than virgin PET¹, effectively excluding recycled products from mass markets.
• Energy cost pressures: Recycling, particularly chemical recycling, is energy intensive. Europe's high energy prices – exacerbated by the post-2022 natural gas price surge – have significantly increased operating costs. In some cases, energy accounts for up to 70% of recycling plant expenses², forcing operators to close facilities unable to sustain such costs. 
• Import of low-cost recycled plastics: Europe has paradoxically become a net importer of cheap recycled plastics, often of uncertain origin and with unverified recycled content claims. This situation undermines domestic recyclers who must comply with higher standards and incur greater costs. 
• Regulatory and investment uncertainty: The lengthy and sometimes unpredictable process of introducing new regulations, coupled with recent threats of repeals and simplifications, creates uncertainty that delays investments. Ongoing ambiguity around the mass balancing methodology used to calculate, verify, and report recycled plastic content remains a significant barrier to investment.

¹ICIS Plastics Price Reports food-grade rPET pellets and virgin PET
²PackagingEurope

¹Wave of Surging Plastic Recycling Plant Closures Hits Europe
²Plastics the Fast Facts 2025 – Plastics Europe

Over the past three years, a series of high-profile cases have highlighted the distress facing the plastics recycling sector (non-exhaustive list):

• Exxon Mobil Corp. announced in September 2025 that it is shelving investments in chemical recycling in Europe due to overly restrictive rules on mass balancing in plastics recycling. The company has paused €100 million of planned investments in recycling facilities in Antwerp (Belgium) and Rotterdam (The Netherlands), until further notice.
• Dow’s Böhlen Chemical Recycling Project (Germany) was terminated in August 2025. The 120,000-tonne chemical recycling project with Mura Technology was stopped before construction even began.
• Veolia has shut down its German PET recycling operations in Rostock (32,000 tonnes of food-grade recycled PET) at the end of 2023. This was followed by the closure of its Bernburg Multipet and Multiport plants in August 2025, ending 70,000 tonnes of annual output after decades of operation owing to economic pressures.
• Biffa’s Sunderland PET Plant (UK) opened only in 2023 with nearly 50,000-tonne capacity. This plant was shuttered in August 2025 owing to unsustainable economics and regulatory pressures.
• The Re-Match (The Netherlands) sorting facility went bankrupt in February 2025 despite a €4.5 million government subsidy, undermining plans for a European-wide network of similar plants.
• The French biotech company Carbios announced a major restructuring in 2025 amid mounting losses and delays in financing its enzymatic PET depolymerisation plant.
• Advanced Plastic Purification International NV (Belgium/The Netherlands) cancelled its ambitious 500,000-tonne chemical recycling facility plan in Ostend (Belgium), citing competition from low-cost Chinese plastics.
• Borealis (Austria and Sweden) cancelled its Schwechat mechanical recycling project and put on hold the Stenungsund pyrolysis project due to economic and regulatory challenges.

Domestic recyclers struggle to compete with imports from Asia, which benefit from looser standards, lower labour costs, and cheaper energy. Domestic demand remains weak, policies are often volatile, and Europe’s cost base is becoming increasingly uncompetitive. Without reforms in energy pricing, global competition rules, and technology, the sector’s prospects may fall short of the optimistic outlook envisioned in a circular economy scenario.

To foster the dialogue with European policymakers, the Antwerp Declaration for a European Industrial Deal was established to clarify the conditions necessary to realise the ambitions of the EU Green Deal and safeguard quality jobs in Europe. Signed by 73 business leaders, the recycling industry and its needs were prominently featured among the coalition’s key demands. The Antwerp Declaration has been presented to the President of the European Commission, Ursula von der Leyen, and its significance has been recognised in the European Competitiveness Compass.

How can the narrative be changed?

To change the narrative and drive the transition in the plastics recycling industry, it is crucial to embrace boldness alongside strategic support. The industry stands at a pivotal moment, where collaboration between government and businesses is essential to achieving shared goals. By coming together, stakeholders can forge partnerships that align interests and resources, creating a unified approach to overcoming barriers. This collective effort is vital to fostering innovation, securing investments, and establishing a competitive and sustainable industry landscape.

As a professional services organisation and catalyst for change, Deloitte is well-positioned to play a leading role in the transition towards a circular economy. With extensive expertise in the plastics recycling sector, a broad network of business leaders, policymakers, and experts, and a comprehensive range of services, we can connect stakeholders, initiate change, and help overcome challenges to the circular economy.

Our services support strategy development and regulatory compliance, assist in securing public and private funding, and help assess high-risk, high-impact investments. We help to create actionable strategies tailored to industry needs, including portfolio and material footprint assessments, regulatory and market insights, strategic roadmap design, innovation advice, stakeholder engagement, and performance measurement to track progress towards circularity goals.

Deloitte’s multidisciplinary teams are eager and well-equipped with both the right expertise and a suite of advanced tools to support the industry’s ambitious goals.

Meet our experts

Industry leader Energy, Resources and Industrials: Frederik Debrabander

Circularity Economy: Maarten Dubois and Stijn Adams

Grants and Incentives: Roel De Mondt and Margo Vanmeerbeeck

Debt and Capital Advisory: Samuel Debaene and Paul Dujardin