Unesda, the pan-European association representing Europe’s soft drinks industry, has called for immediate attention to be paid to a dilemma facing many of its members: the shortage of recycled PET.
According to the association, recycled PET is becoming ‘almost as rare and expensive as white truffles or gold’ in the EU. Demand for qualitative recycled PET from beverage bottles is not only high, it significantly exceeds supply.
As the association points out, beverage producers have special requirements they must meet, in terms of mandatory recycled content and collection targets, as well as compliance with strict food-grade safety requirements for their packaging. They are required to make considerable investments to ensure the recyclability, collection, and recycling of their packaging and can recycle their packaging several times in a closed loop.
Yet, says the association, despite these legislative requirements and the sector’s investment in bottle-to-bottle circularity, many companies in the soft drinks sector have limited or no access to the recycled PET issued from their own packaging. Concerns about not being able to meet the obligations arising from the EU Single-Use Plastics Directive, are therefore mounting, as access to sufficient high-quality recycled PET becomes ever more difficult. Small to medium-sized enterprises (SMEs) are particularly at risk, as many can simply not afford the very high prices of recycled material.
According to Lucia Morvai, Director of External Affairs and Communications at Správca zálohového systému, the Slovak Deposit Return System (DRS) Administrator, in Europe, rPET is reportedly at a 30%-plus premium over virgin material. Moreover, the situation is only set to will worsen, said Água de Monchique, a Portuguese SME: “When more producers will start incorporating rPET to meet the 2025 and 2030 targets, the access to rPET will be even more limited.”
The rPET price is currently defined by what the highest bidder is ready to pay, with companies from, among others, the food, textile and automotive sectors competing against each other. As Unesda points out, it is hardly fair that many businesses with recycled content targets are unable to access the necessary material to comply with their legal obligations, or that the current pricing favours downcycling over closed-loop recycling.
The association is therefore proposing the introduction of a priority access mechanism or right of first refusal in the upcoming revision of the EU Packaging and Packaging Waste Directive. Every producer, from large to small, would then have the option to buy the recycled material issued from the recyclable packaging it put on the EU market - after adjustment for collection and recycling rates.
Such a system would put all beverage producers, including SMEs, in a position to meet their mandatory recycled content targets, considerably reduce the downcycling of PET bottles by promoting bottle-to-bottle recycling, and incentivise all sectors, including those outside the beverage industry, to invest in the recyclability and collection of their products.
Soft drinks producers across Europe strongly support this proposal. In Sweden, where such a system was implemented several years ago via the country’s DRS system, it has been shown to work.
Anna-Karin Fondberg, Managing Director at Sveriges Bryggerier/ The Swedish Brewers, explained the benefits: “Thanks to this system, all beverage producers contributing to the DRS can buy a share of recycled content proportionate to the recyclable packaging they put on the market. This helps reducing the amount of food-grade material being sold to companies which are not participating in the collection of the material, and which will use our material for lower quality applications, therefore breaking our loop. Without this system, many of the numerous SMEs operating in our sector would not be in a position to access the recycled material they need to meet the EU recycled content targets by 2025 and 2030.”
Slovakia, too, has a system in place. “In the founding documents of the Slovak DRS we committed ourselves to support closed-loop recycling and to create the conditions that will secure priority access to recycled material to all producers registered in the Slovak DRS,” said Lucia Morvai. “Each producer, local or not, big or small, has the same opportunity to use its right of first refusal to access a share of material (collected and sorted), based on the quantity and quality it put on the Slovak market.”
The system has been warmly welcomed by local producers. Milan Pasmik, Chairman of the Board at McCarter a.s., a Slovak company producing premium soft drinks and juices, said he viewed it as an important step towards securing the necessary amount and quality of materials needed ‘to fulfil not just our legal requirements but also our voluntary commitments to close the loop of our packaging’.
The benefits are clear. Introducing a priority right mechanism or right of first refusal in the revised EU Packaging and Packaging Waste Directive offers the opportunity to constructively address the problem. Unesda and its members are therefore calling on the European Commission to act now.