From shortage to solution: How to secure a steady supply of recyclates

Recyclates are becoming mandatory – but is supply keeping up? The packaging industry is at a turning point: stricter recycling quotas, growing regulatory demands, and the pressing question of the availability of recycled materials. Can these challenges be overcome? The answer is nuanced: The path is complex but feasible – if business, politics, and society work together. Greiner Packaging demonstrates how this transformation can succeed – with innovative solutions, a willingness to collaborate, and a firm commitment to the circular economy.

Whether it’s a quick snack on the go, breakfast cereal at the office, or coffee to take away – packaging is an integral part of everyday life. It protects products, facilitates transportation, and extends shelf life. But what happens afterward? As a quick look into a waste container reveals, recycling is often more complicated than it seems. 

While some packaging can easily be recycled, others, despite good intentions, end up in landfill or incineration. The reasons are many: complex material combinations, lack of collection systems, or limited recycling capacity. Inconsistent collection and sorting systems also pose challenges for consumers. The packaging industry therefore faces the task of designing packaging that is not only attractive and functional but also seamlessly fits into the recycling loop. Because truly sustainable solutions don’t start at the waste bin – they start with the very first design idea.

This blog article is divided into four parts:

• Part 1: PPWR: Guidelines for a sustainable packaging future
• Part 2: The fear of a recyclate shortage – more real than expected
• Part 3: Potential solution approaches
• Part 4: PP, PET, PS - a closer look 

This is exactly where the European Union’s Packaging and Packaging Waste Regulation (PPWR) comes in – one of the most sweeping reforms for the packaging industry. By 2030, all packaging must be fully recyclable or reusable. Single-use packaging must be reduced, and unnecessary materials avoided, to create closed recycling loops.

The packaging industry uses a variety of plastics – each with specific properties, advantages, and challenges:

One of the key challenges in meeting the PPWR requirements is the anticipated shortage of high-quality post-consumer recyclates (PCR), particularly for food-grade polypropylene (r-PP). According to a 2024 Conversio study, even under optimistic assumptions, PCR supply could fall short of demand by up to 800,000 tons by 2030. For food packaging made from non-PET plastics like PP or PS, a shortfall of at least 200,000 tons is expected. At the same time, Plastics Europe forecasts that only about 500,000 tons from chemical recycling will be available by 2027 - far too little to meet growing demand.

Currently, only around 30% of recyclate from packaging remains within the sector; the rest flows into other industries. “With mandatory quotas coming into effect, competition for high-quality material will only intensify,” says Giebel.

Supply gaps in the scenarios**

Demand for recycled plastics is growing, but actual availability is still lagging behind. There are several reasons for this.

Mechanical recycling reaches its limits in many applications – chemical recycling is seen as a possible solution. But reality is more complex: Many technologies, such as pyrolysis, have a high energy demand and a disputed carbon footprint. There is progress in solvent-based processes and depolymerization, for example with PS and in the future PP. However, many projects are still in the pilot stage; their scaling requires time and reliable political framework conditions. “If policymakers signal that quotas will be lowered because investments are lacking, there will be no incentive for companies to invest in new recycling processes,” warns Matthias Giebel. “This could create a vicious cycle – slowing change instead of accelerating it.”

According to a recent Conversio study, even in the optimistic case, the total European production capacity for chemically recycled plastics will only amount to around 500,000 tons by 2027 – compared to an expected demand of around 6 million tons of post-consumer recyclate in the packaging sector. For food-grade PP packaging, the supply from chemical recycling still needs to be significantly expanded. Greiner Packaging is already using the first chemically recycled materials. According to Greiner, it is crucial to further develop supply chains together with customers at an early stage. 

The regulatory recognition within the framework of the PPWR has also not yet been fully clarified. Conclusion: Chemical recycling is important, but it alone will not be enough to close the recyclate gap. 

An additional tool to close the recyclate gap could be “Certified Recycled Content Token Trading” - a system where surplus high-quality PCR (e.g. from non-food applications) could be traded to meet recycled content quotas. While already possible in Switzerland, the EU currently lacks the regulatory framework for it. Two things would be needed for its introduction: First, clear rules for mass balance accounting (allowing book-and-claim systems for recycled content). Second, a legal basis under the PPWR allowing the European Commission to implement such a model by delegated act. If introduced across Europe, it could offer important safeguards for food packaging manufacturers - and incentivize more high-quality mechanical recycling.

To achieve the ambitious PPWR targets, the availability of high-quality recyclate for three key plastics must be significantly increased: 

PP is a versatile plastic used for a wide range of applications – from yogurt cups to medical packaging. However, very little high-quality r-PP suitable for food contact is currently available. The reasons include a lack of closed-loop systems, insufficient collection, and a shortage of specialized recycling facilities. Design-for-recycling initiatives alone are not enough – clean, single-stream collection of input materials is critical to producing suitable recyclates. 

There are several international initiatives aiming to create closed-loop systems for polypropylene. Whether they will deliver viable solutions on an industrial scale remains uncertain. Most are still in pilot or early stages, with limited volumes of certified-quality recyclate available. A broad supply of r-PP in meaningful quantities is not yet in sight.

At the same time, new recycling technologies such as solvent-based processes, as well as regulatory incentives for investment in r-PP infrastructure, are urgently needed. One approach currently under investigation is the “super-clean” process being studied by Fraunhofer IVV. Here, polyolefin streams, including PP, undergo intensive cleaning stages to achieve a level of decontamination that could make them suitable for food contact. The goal is to meet EFSA safety standards for PP – similar to what is already standard for PET.

PET is the recycling pioneer among packaging plastics. Bottle-to-bottle loops are already well established, although tray-to-tray recycling is still in its infancy. Advances in sorting technologies, washing facilities, deposit systems, and the development of standardized mono-material trays could be decisive in accelerating progress. Although PET is considered a relatively “safe” plastic, r-PET remains scarce or unavailable in sufficient quality for applications outside the beverage sector. From 2025, the EU will mandate a 25% r-PET share in single-use beverage bottles – Germany already exceeds 50%, according to studies. However, competition for r-PET is intensifying – for example, through its use in textiles and other packaging sectors. As a result, PET recycling is becoming a system-critical factor for the circular plastics economy.

One solution is to improve the separation of PET trays and containers from other materials through better sorting technology, such as AI-supported NIR sorters. The development of “tray-to-tray systems” with standardized mono-material trays is also being driven forward across Europe. There is also discussion about expanding chemical recycling for PET, especially for heavily contaminated or multi-layered materials that are no longer mechanically recyclable.

However, PET faces limitations in applications such as hot filling or hot sterilization – its thermal resistance is limited. Moreover, PET’s higher density leads to greater material use for the same volume, which negatively impacts its environmental balance. PET remains important – but it is not a universal solution for all packaging needs.

For a long time, PS was considered difficult to recycle. But new studies, including by Fraunhofer IVV, show that PS – like PET – is a diffusion-resistant, inert material fundamentally suitable for food contact if recycling processes achieve sufficient purity. Progress has been made in physical recycling, such as through dissolution processes. The first pilot projects for yogurt cups made from mechanically recycled PS have already reached the market – proving that r-PS can, in principle, be used for sensitive food packaging when proper processes and regulatory frameworks are in place. Intensive efforts are also underway in chemical recycling for PS: Initiatives like Styrenics Circular Solutions (SCS) are advancing depolymerization and other material recovery technologies to achieve full circularity for styrene plastics. The goal is to make EFSA-compliant r-PS widely available – although regulatory approval from EFSA is still pending.

While food-grade r-PS remains limited within the EU, Switzerland offers a notable exception: Thanks to national regulations, Greiner Packaging has already launched the K3®-N multi-chamber cup portfolio made with r-PS, backed by robust testing and approval processes in collaboration with authorities. In the EU, however, a clear legal basis for industrial-scale implementation is still lacking.

The gap between recyclate demand and availability cannot be ignored. It requires honest communication, technological advancement, political support – and the courage to explore alternative solutions. For Greiner Packaging, that means: strategically securing recyclate volumes, actively advancing recycling initiatives with partners, supporting technological innovations, closely monitoring regulatory developments, and providing competent advice to customers – instead of making promises that cannot be kept.

Those who gain a realistic view today can act strategically. 2030 is fast approaching – and with it the opportunity to shape the future of packaging.

* In both scenario models, the current export surpluses were extrapolated to the year 2030.

** Source: Conversio Market & Strategy GmbH, 2024, Forecast Model “Use of recyclates in Europe 2020 to 2030”