US downstream aims to create sustainable future for plastics with circular economy

Plastic remains the world’s packaging material of choice. Roughly a third of the 350 million tonnes produced globally is used in packaging applications. But as public perception shifts and the issue gets pushed up the political agenda, the tide is turning for the downstream industry.

Pepsi is one of many downstream customers requesting more recycled plastics. Image by Pascua Theus.

As the importance of a circular economy grows alongside demands from major customers, many downstream manufacturers are creating sustainability and recycling plans and solutions for the glut of plastics coming online in the U.S.

“These (initiatives) could reduce or cause peak petrochemical demand growth in the future, especially considering the significant number of aromatics and olefins are used within the plastics industry e.g. paraxylene for PET bottles and ethylene for polyethylene trash bags,” said Steve Zinger, Wood Mackenzie Chemicals Senior Vice President.

Recycling will be a key part of plastics sustainability, since many U.S. downstream manufacturers are adding billions of pounds of new production capacity even as they work to handle existing plastics waste.

Many of the plastics being produced as a result of the First and Second Wave of construction are the items that are targeted for increased levels of recycling and even, in some cases, replacement with non-plastics.

“Plastics producers will ultimately need to make their products more recyclable, support waste collection improvements - particularly in developing countries - and look for ways to become part of, or inject, recycling into their business or production processes,” Zinger said.

Now, More Investment Needed

Up to $3 billion in additional capital investment would be required to achieve current U.S. recycled plastics content goals by 2030, according to an analysis by Wood Mackenzie.

“The issue of sustainability has become an important driver over the past few years, as more brand owners, packaging companies and retailers have announced sustainability targets. These goals have placed an emphasis on using recycled plastic, primarily RPET, as a central component of their products,” said Dr. Michael Bermish, Wood Mackenzie Chemicals Principal Analyst.

“However, this raises the question of whether there will be enough PET bottles recovered to meet these ambitious bottle-to-bottle requirements,” Bermish said.

Wood Mackenzie Chemicals currently projects the available pool of RPET recycled bottles to increase by approximately 265,000 by 2025 and approximately 505,000 by 2030.

Buyer Demands

Many major customers are jumping on the sustainability and circular bandwagon, pushing manufacturers to answer their demands.


PepsiCo Inc. wants to cut use of virgin plastic beverage packaging by more than a third by the middle of next decade. The soda and snack food giant said increased use of recycled plastic, as well as alternative packaging, will help the company reach its 35% reduction goal.

PepsiCo's SodaStream business, which uses home machines to made soda in reusable packaging, is also being counted on to cut single-use plastics at the company.

“While our efforts are far from done, this is one more step in PepsiCo's journey toward helping to build a world where plastics need never become waste,” CEO Ramon Laguarta said in a statement. “Even as we work to accelerate business growth, we continue to make important progress toward a circular economy for packaging.”

The September 13, 2019 news of the virgin plastic reduction goal comes as PepsiCo previously said it wanted to have all packaging recyclable, compostable or biodegradable by 2025. The company also wants to increase recycled content in packaging to 25% in the same time frame.

“We're intentionally setting ambitious goals to drive meaningful progress,” said Simon Lowden, president of PepsiCo Global Foods, in a statement. “PepsiCo is already one of the world's largest buyers of recycled plastic, and if there was more available, we'd buy it — and if there were more markets where we could use it, we would.”

PepsiCo is using 2018 numbers as a baseline to measure reduction. The company used 4.8 billion pounds of virgin plastic that year.

Bottled Water

PepsiCo has said that its Bubly brand of sparkling water will no longer be packaged in plastic starting in 2020.

Also, Aquafina water will start offering canned water to foodservice locations in the US in 2020.

Another brand, LIFEWTR, is transitioning to 100% recycled PET in the United States, and the company's Tropicana brand aims to reach 100 percent recycled PET use in Western Europe by 2025.

Owners create sustainability plans

With the importance of a circular economy on the rise, many major firms have created programs and hired on special roles to focus on plastics waste.

Hasbro -Toys

One of the world's largest toy companies is phasing out plastic from packaging. Hasbro revealed the decision August 20 by indicating changes will start in 2020 and be virtually complete by the end of 2022. Hasbro's stable of products includes Nerf, Transformers, Monopoly and My Little Pony.

The end of plastic will include packaging such as polybags, shrink wrap, blister packs and windows. Elastic bands are also on their way out, the company said.

Amazon -Packaging 

Amazon decided earlier this year to move to lightweight flexible plastic mailers over its traditional cardboard boxes, a move that is expected to set a trend for the rest of the industry.

Amazon is also currently working on a cushioned mailer (typically a paper// polyethylene laminate) that is fully recyclable in paper recycling streams, reinforcing its new direction away from carton board. The company confirmed that, after continually working to improve packaging options, it reduced global packaging waste by 20% in 2018.

LyondellBasell -Solutions

LyondellBasell earlier this year announced that CEO Bob Patel had joined with Procter & Gamble CEO David Taylor and Veolia CEO Antoine Frérot in leading the newly announced global Alliance to End Plastic Waste (AEPW).

The AEPW is a group of almost 40 global firms that have pledged $1.5 billion to help solve the problem of plastic waste on a global scale.

It is the first-ever international coalition of chemical and plastics manufacturers, converters, consumer goods companies, retailers and waste management companies dedicated to partnering with the finance community, government, and environmental and economic development NGOs to find market-based solutions to ending plastic waste in the environment.

“From helping to reduce food waste and improving healthcare products to cutting fuel consumption and emissions from lightweight vehicles, there is no doubt that plastics have played a positive role in improving quality of life for billions of people around the world,” LyondellBasell CEO Bob Patel said in a statement.

“But like so many other products, responsibly managing their disposal or reuse has become a concern – not just for governments or NGOs, but for all of us,” Patel added.

The companies that comprise AEPW have a goal over the next five years to develop and bring to scale solutions that will minimize and manage plastic waste and promote post-use solutions.

“This approach is unique because it brings together and focuses the efforts and knowledge of plastics producers, consumer goods companies and retailers, as well as waste management companies,” Patel said. “Having the resources and knowledge of the entire global value chain under one umbrella with the same goal is really very powerful.”

LyondellBasell was already active in building its circular economy strategies before helping to found the AEPW.

In March 2018, LyondellBasell and SUEZ entered into a joint venture to acquire Quality Circular Polymers (QCP), a premium plastics recycling company in the Netherlands.

The joint venture leverages SUEZ's collection network and technology solutions to improve the identification, separation and preparation of materials to be used as feedstock at QCP.

In July 2018, LyondellBasell announced it signed an agreement with the Karlsruhe Institute of Technology (KIT) in Germany to advance chemical recycling of used plastics.

The goal of this effort is to develop a new catalyst and process technology to decompose post-consumer plastic waste into clean feedstock for reuse in new products.

Nova Chemicals -Solutions 

Nova Chemicals has named Sarah Marshall as its first director of sustainability. Marshall is the former chair of the board of directors for the Canadian Plastics Industry Association (CPIA). In 2019, Nova became a founding member of the Alliance to End Plastic Waste as well.

In her new role at Nova, Marshall will oversee the firm's corporate investments in supporting collaboration and promoting ocean health. She'll also serve on industry association boards and committees.

Nova supports the goals of the CPIA and the American Chemistry Council (ACC) to make all plastics packaging recyclable or recoverable by 2030 and to have all plastics packaging reused, recycled or recovered by 2040, Marshall said.

Recently, Nova has developed a portfolio of recyclable film structure designs for packaging applications, including a recyclable stand-up pouch film structure that can be used in food packaging traditionally made with nonrecyclable, mixed-material structures.

Nova last year pledged $2 million to support Project Stop, a program that was co-created in 2017 by Nova's sister company Borealis and by SYSTEMIQ, a sustainable land use and energy firm.

Nova's first effort with Project Stop has been the opening of a recycling center in Muncar, Indonesia. That location was chosen because of Indonesia's high rate of plastics leakage into the ocean.

Dow Chemical - Solutions

Dow Chemical has reached an agreement with the Fuenix Ecogy Group, based in Weert, The Netherlands, for the supply of pyrolysis oil feedstock, which is made from recycled plastic waste. The feedstock will be used to produce new polymers at Dow’s production facilities at Terneuzen, The Netherlands.

This agreement marks an important step forward to increase feedstock recycling – the process of breaking down mixed waste plastics into their original form to manufacture new virgin polymers.

The polymers produced from this pyrolysis oil will be identical to products produced from traditional feedstocks, and as such, they can be used in the same applications, including food packaging.

This agreement is an example of Dow’s strategy to enable a shift to a circular economy for plastics by focusing on resource efficiency and integrating recycled content and renewable feedstocks into its production processes, the company said in a statement.

“We believe plastics are too valuable to be lost as waste and should be part of the circular economy,” said Diego Donoso, business president for Dow Packaging & Specialty Plastics.

“With partners in South America, we have supported the development of construction materials made with recycled plastics for schools, and in Southeast Asia, Mexico and the U.S., we have built roads made with recycled plastics. This partnership with Fuenix is an important next step in moving us closer to the future we envision, which is the sustainable production of circular polymers.”

By Heather Doyle