A tough year for the SA recycling industry

by Darren
Polyco recycling industry Jnl 5 16

The Polyolefin Recycling Company continues to adapt regardless of the challenges it faced the past year.

POLYCO, the Polyolefin Recycling Company (NPC), hosted their fourth Annual General Meeting in Johannesburg recently. Addressing the association’s board members, which represents the leading packaging converters in South Africa, Chief Executive Officer Mandy Naudé presented a detailed report on their business and the state of the local polyolefins recycling industry.

“This past year has undoubtedly been a tough year for the polyolefin recycling industry in South Africa as well as the rest of the world,” says Mandy. “Whilst lower virgin resin prices had an impact on the local market, they were fortunately offset by the weakening Rand. However, local recyclers of polyolefin plastics also had other challenges they needed to contend with during 2015, including load shedding, expensive electricity costs, water shortages and a general downturn in the economy.”

The low market demand, together with rising costs, has made the recycling sector a tough space to operate in. The impact of these difficult trading conditions were severely felt by the POLYCO project partners, who reported lower than expected recycling volumes for their financial year ending 31 December 2015.

However, all is not doom and gloom according to POLYCO, as the 177 000 recycled tonnes positively contributed in excess of R1.7 billion to the country’s GDP. The total plastics recycling industry contributed in excess of R2.85 billion to GDP in 2014 and created over 53 000 employment opportunities.

“We must also bear in mind that recycling is a commodity-based business which is cyclical in nature. Whilst the current conditions might be tough, we have developed a clear-cut plan of action that will help us build a much-needed robustness into the industry, so as to be ready for when the market turns again,” Mandy said.

It is clear that the association is using the tough conditions to take an even closer look at their business model and, where necessary, make changes in response to what the market needs. To this end, they are now working even closer with recyclers in an effort to address and solve some of the biggest stumbling blocks they are facing, such as dirty post-consumer materials (due to a lack of effective separation-at-source initiatives), ageing and inefficient equipment, untested quality and an inconsistent value-chain.

However, POLYCO is also calling on brand owners to become involved with their current initiatives in order to create a strong, sustainable circular economy which eliminates waste. “To a large extend, the ability to create a sustainable circular economy lies extent in the hands of our brand owners, as they are the ones who ultimately control the products being offered to the consumers,” Mandy explains.

“We are grateful for the tremendous support the industry has shown us this past year,” Mandy concludes. “As an industry and an association, we look forward to what is to come, knowing that we will continue to grow and evolve as long as we continue to embrace the move to circular economy thinking”.

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