With circularity comes responsibility
Governments and companies recently finalised the European Plastics Pact. In it, they agreed to increase capacity for collecting, sorting and recycling plastics by at least 25% in five years' time. By the same year, at least 30 percent of all packaging must consist of recycled material. By agreeing on these targets, the plastics industry is steadily increasing its focus on circularity, a fact which has not escaped PRS, a pallet pooler for the petrochemical industry.
In March of this year, 66 companies and organisations and 15 public authorities signed up to the pact’s objective. Signing is voluntary, but not without obligation. Every year, a rotating steering committee consisting of signatories monitors how far all the participants have progressed with implementation. This is the first time that so many different parties, from supermarkets and confectionery manufacturers to governments, have jointly committed themselves to this on a European scale. "If you look at where we are now and where we want to get to, there is still a lot to do”, says Rinus de Kok, commercial director at pallet pooling company PRS.
Multi-purpose pooling system
PRS has set up a European pallet pooling system for polymers manufacturers. These producers supply plastic granulate on standardised wooden pallets supplied by PRS to manufacturers of plastic granulate throughout Europe. "We sometimes say that we are only a modest supplier with a fairly basic product”, says De Kok. "But we deliver millions of pallets a year to over a hundred locations across Europe." The pallets ultimately end up at ten thousand plastics processing sites, where PRS picks them up again after use. PRS then repairs the damaged pallets and returns them to the pool. This means the pallets are reused for as long as possible. “Currently we only pick up our own pallets, but why not also collect other residual flows, such as used packaging materials from plastics processors?" With our network, we are in a unique position to contribute to the circular model of the polymers industry."
For example, most polymers producers in Europe use 25 kg bags to pack and transport plastic granulate. Recyclers want to get these bags back so that they can turn them into high-quality recycled granulate again. "In that case, we can leave a crate with the customer to put the empty bags in”, says De Kok. “We regularly pick up the pallets, so we might as well pick up a crate full of bags at the same time." De Kok notes that there is more and more discussion about these kinds of models: "Can we combine the existing business model with other return flows?"
Going circular together
A platform on which such discussions are held is PCEP, the Polyolefin Circular Economy Platform. The organisation, which was founded about two years ago, aims to change the industry from linear to circular. The platform is an alliance of several European parties in the polyolefin (polypropylene and polyethylene) industry, such as manufacturers, plastics processors and recyclers.
One of PCEP’s objectives is to discover new markets for recycled plastic. A number of parties within the platform are conducting a pilot project that involves developing a plastic pallet as an alternative to the wooden one. "Of course we'd like to play a part in that”, says De Kok. "With our knowledge and the network we operate in, we can contribute to this development. So we have joined PCEP in order to be part of the conversation and are now actively involved in a first pilot project in this area."
In the project, PRS is working with Cabka, a specialist in recycled plastic pallets. De Kok: “Of course, Cabka doesn’t know the polymer industry value chain the way we know it, with our almost 25 years of experience. You see, a pallet needs to meet quite a few requirements." In the first place, it must be able to bear a load of up to 1,500 kilograms of pellets and be placed in a rack without bending permanently. What’s more, the pallet must be able to rest on the forks of a forklift truck and not slide off when it brakes. "These are all functional requirements that wood meets perfectly at the moment”, says De Kok. "Wood is strong, easy to repair, it comes from a certified source and is also sustainable in a pooling system. But of course we share the ambition of finding a high quality use for recycled plastic, and a plastic pallet could be that."
Too many pallets lost
But developing the perfect recycled plastic pallet is not the only challenge for PRS. "Recycled plastic pallets only become profitable if you use them as often as possible”, says De Kok. And that remains a challenge, even with wooden pallets. Out of every hundred pallets produced by PRS, slightly less than half disappear off the radar. This is partly because pallets are shipped to different continents (and so end up at locations where, from a CO2 and cost perspective, it no longer pays to recover them for reuse) and partly because pallets are lost to plastics processors because they are burned or resold, for example. De Kok: “We really need to reduce those loss rates on recycled plastic pallets, otherwise we can't pool cost-efficiently."
And there's the rub, says De Kok: “It’s great that there is an increasing focus on recycling and circularity, but only if the whole polymers industry is committed to it can we make it a success." PRS is trying to encourage its partners, the plastics processors, with the launch last year of the Green Label. Customers are entitled to use this label if they participate in the reuse of PRS pallets. “Initiatives like these put circularity even more firmly on our partners’ agendas. It remains a challenge, but through discussions with parties within PCEP, you realise that everyone is keen to do their bit."
CO2 pricing part of the solution
According to De Kok, there is also another major challenge for policymakers: reducing the price difference between virgin and recycled plastic. The price of recycled plastic is already fairly stable and is primarily driven by logistics and processing costs. The price of pure plastic, on the other hand, fluctuates violently with the price of oil. De Kok: “We saw this at the start of the Covid-19 crisis. As soon as the price of oil drops, a virgin plastic pallet is suddenly cheaper than a recycled one. And that conflicts with sustainability objectives.” De Kok believes policymakers need to change the way the market operates. "And I think there's only one way you can do that, which is by putting a price on CO2. That’s the only way to make the price of recycled plastic competitive. With circularity comes responsibility, and occasionally a slightly higher price. Even if that’s sometimes not what people want to hear. And only by working together can we shoulder that responsibility together."