Supply chain approach is essential for plastic recycling success says Axion

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Axion Consulting has said that the recycling industry and infrastructure needs to move to a complete supply chain approach if it is to thrive and succeed.

This follows the failures of several plastic recyclers recently.

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Axion Consulting senior engineer Richard McKinlay said that lower oil prices, changing demand and volatile markets all had an influence, but “this was not the whole story”.

He added: “Two key elements of a sustainable and stable business model are having access to a reliable, long-term supply of input waste raw material and then being in full control of the whole value-adding process right through to the output of high-quality, finished products…

“…A long-term approach that avoids external price influences and reactive volatility created from supply/demand imbalance delivers the gross-margin stability that is needed to keep the business profitable and always covers monthly operating and overhead costs.

“The result is a regular and predictable cashflow that is necessary to pay back the investors in capital intensive processing plant…

“…As we transition further towards the circular economy, the complete supply chain approach will play a key role in the survival of sustainable business.

“We need to build strong links between recyclers, those controlling the generation and collection of the waste, and ideally, the end user to keep the recycled material supplies flowing.”