Austrian plastics recycling machinery supplier Erema is growing ‘with the market and for the market’, with plans to increase production capacity by 50% and unveil exciting new technologies at the K-Show. Group CEO Manfred Hackl talks about the fast-changing landscape of the recycling industry and what it is like being in the recycling business at this key juncture
Q: How do you explain the role of Erema in the future of plastics recycling?
A: The role of Erema in the future of plastics recycling is going to be quite similar to what it has been these past few years. Over the last three to four years, we set ourselves the goal of “combining” the industry. That is to say we wanted to bring together the virgin materials producers, machinery makers, recyclers and the entire value chain to focus on closing the loop.
Combining the plastics industry means that, in order to achieve a circular economy for plastics, dialogue is needed between all the players in the plastics chain, from raw material manufacturers and plastics processors to producers and recyclers.
Here, Erema makes a major contribution to the networking of these players through its own activities as well as through its participation in international platforms.
We can only highlight the real value of plastics, when we close the loop. If we do that, we can show the real value, just like other materials such as paper, metal or glass.
And let’s not forget that plastic is an important everyday material. Therefore, we would like to continue this role even more strongly in the future, with new business units and companies to promote the industrialisation of plastic recycling.
Q: As the CEO, you have put Erema on the map as a leading brand in recycling technology. Can you say something about that journey?
A: Erema has been around for 37 years and I have been with the company almost 25 years. Over these past 25 years, the change has been dramatic.
Take the PET bottle for example. PET bottle recycling first started around 20 years ago. Nowadays, in Europe, we have a collection and recycling rate of over 50% of PET bottles and in some countries between 80 to 95 %. This didn’t exist 20 years ago.
Similarly, we have advanced in film recycling and if you look at the German stream of household recycling, you can see that films like DSD 310 are nowadays being recovered and reprocessed into film again there.
This shows how much work has gone into developing technologies.
At Erema in particular, we have developed over 100 patents and new technologies, mainly as a result of working closely with the customers and paying attention to their requirements.
Q: Attitudes towards recycling have undergone quite a change in the past few years. Has this influenced decisions about technology developments?
A: If you look at the last three years, there has been a tremendous change in attitude.
Before, the view was to recycle materials in order to save money.
Nowadays, brands want to use recycled materials because they want to close the loop.
Our company had to and still has to develop new technologies for various purposes including filtration, homogenisation and the production of odourless recyclates. Many new technologies have been developed to fulfil such requirements by customers.
Additionally, over the last five to 10 years, we have been continuously improving the quality, efficiency and production of our machinery to meet the demands of clients.
And I think we have done well. If you look back at 10 years ago, Erema’s turnover was €60m. We have now tripled this amount to €180m, through organic growth within the group and not through acquisitions.
And our target is to grow with the market.
Q; What about the European Union’s new plastics strategy and the circular economy ambition, is this having an impact on your business?
A: The new European strategy which sets recycling targets of 10 million tonnes by 2025 will be tremendous for us and the entire plastic industry.
We are sure that it will help our business grow and in order to be prepared for this increasing demand, we are expanding our business.
We are investing about €22m to expand production capacity by 50% this year. Construction work is set to start in two weeks and we are expecting to finish by the beginning of next year. This added capacity will prepare us for the anticipated growth in the near future.
The expansion will include adding two new big assembly halls at Erema’s Ansfelden location, in Austria. These halls will be larger and higher than our current ones, in order to accommodate bigger machines.
In parallel, we are expanding Erema’s sister company 3S, which manufactures components and screws for Erema machinery. The €5m expansion started last year and is expected to complete in May.
We are also on track with our philosophy that we have to develop new business models to meet the demands of the market today.
For instance, we now have a new business unit, Keycycle, for plant engineering and feasibility studies for potential investors and those who are interested in entering the market.
The business merges 4 areas into 1 unit: whole system support; initial project phase support; overall process & project management experience and network building with ‘big partners’.
Q: Can you tell us more about how this new approach has been received in the market?
A: I can tell you that we saw a significant amount of interest and we were quite surprised by it. We have a few projects going on, but they are not finalised just yet.
The fascinating part is that we have received almost worldwide attention. We have had companies approaching us from the US, Europe, the Middle East and Russia.
It is very heartening that there are so many interesting projects and topics going on at the moment.