Local circular plastics solutions to replace mega projects business model

Chemical companies

SHARE THIS STORY

NEW YORK (ICIS)–There will be a paradigm shift away from mega crackers producing massive volumes of plastics for export, and toward local recycling of plastic waste for local finished goods production.

Joe Chang, editor of ICIS Chemical Business, summarises my presentation earlier this month to the Societe de Chimie Industrielle in New York.

“The industry has to learn to do more with less – it has to move to a circular economy and local production. There is lots of money to be made in putting together a business model around the collection, recycling and processing of plastics locally – this is one of the big opportunities of our time,” said Paul Hodges, chairman of international eChem.

Hodges spoke at a virtual meeting of the Societe de Chimie Industrielle.

“If you need plastic packaging, where would you start today? Waste sites in places like New York are absolutely filled with plastic, so why drill in Texas when you have all of the hydrocarbon feedstock you need locally”, he asked.

The chemical industry is uniquely positioned to find cost effective solutions in local plastics recycling, from collection to mechanical or chemical recycling and resin processing, to 3D printing to make products with less wasted resin, he noted.

Building such a local, service oriented system would be “much cheaper than building $5-10bn plants in Houston”, said Hodges.

“The days of the fossil fuels industry are finished. Local circular solutions will be much cheaper and won’t have climate change issues,” he added.

This also fits into the paradigm shift of re-shoring of supply chains, as local waste sites are turned into “resource centres”, the consultant said.

“New business models will have to be created, covering the entire value chain from collection through processing, manufacturing – including 3D printing – and distribution. This creates a major opportunity for innovative companies to capture the sweet spot in the value chain, and roll out the new models domestically and in export markets,” said Hodges.

New technologies typically follow an S-curve in their development, where things progress very slowly for some time. But transitions can rapidly accelerate once a number of obstacles are overcome, the consultant pointed out.

The chemical industry will increasingly transition, from a production-oriented model providing “stuff” for a growing population, to a more sustainable service-oriented model that provides solutions, he said.

PREVIOUS POST

The blog will return on August 30

09/08/2020

Learn more
NEXT POST

Reality dawns for business as No Deal Brexit approaches

06/09/2020

I warned before the June 2016 Brexit referendum that Brexit was all about politi...

Learn more
More posts
Reshoring set to create Winners and Losers as advanced manufacturing takes over
12/07/2020

Not many companies still operate in the same way as 500 years ago, or even 50 years ago. But in manu...

Read
Polyethylene’s crisis will create Winners and Losers
08/12/2019

Polyethylene markets (PE) are moving into a crisis, with margins in NE Asia already negative, as I h...

Read
Day of reckoning approaches for US polyethylene expansions, and the European industry
08/09/2019

Planning for future demand in petrochemicals and polymers used to be relatively easy during the Baby...

Read
Stormy weather ahead for chemicals
24/03/2019

Four serious challenges are on the horizon for the global petrochemical industry as I describe in my...

Read
Ethane price hikes, China tariffs, hit US PE producers as global market weakens
23/09/2018

Sadly, my July forecast that US-China tariffs could lead to a global polyethylene price war seems to...

Read
US ethylene prices near all-time lows as over-capacity arrives
13/05/2018

US ethylene spot prices are tumbling as the major new shale gas expansions come on line, as the char...

Read
World Aromatics Conference focuses on key industry challenges
04/11/2017

Our 16th World Aromatics and Derivatives conference takes place on Wednesday/Thursday in Amsterdam. ...

Read
Hurricane Harvey will turbocharge move to the circular economy
25/09/2017

300,000 homes and half a million cars have been destroyed by Hurricane Harvey.  And in terms of bus...

Read

Market Intelligence

ICIS provides market intelligence that help businesses in the energy, petrochemical and fertilizer industries.

Learn more

Analytics

Across the globe, ICIS consultants provide detailed analysis and forecasting for the petrochemical, energy and fertilizer markets.

Learn more

Specialist Services

Find out more about how our specialist consulting services, events, conferences and training courses can help your teams.

Learn more

ICIS Insight

From our news service to our thought-leadership content, ICIS experts bring you the latest news and insight, when you need it.

Learn more