Dow Jones: Path to Disruption of the Circular Plastics Model- Jiaxing Fuda Chemical Fiber Factory

At the 32nd China International Plastics Recycling and Recycling Conference ChinaReplas2025, the China Polyolefin Market Research Director of Dow Jones OPIS Chemicals Market Analysis Division Zhai Yuanjie to 《 The path to disruption in the circular plastics paradigm 》 as the title, Systematically sort out the development trends, technical paths, market challenges and policy opportunities of global plastic recycling, aiming to provide comprehensive and forward-looking insights for industry decision-makers, investors and policy makers.

Zhai Yuanjie (Director of Polyolefins Market Research, China, Dow Jones OPIS Chemicals Market Analysis Division)

— 1 —

Main challenges and bottlenecks

In the context of the increasingly serious global plastic pollution problem, the traditional linear economic model of "production-use-disposal" is no longer sustainable. As a disruptive transformation path, the plastic circular economy is gradually becoming the focus of governments, enterprises and scientific research institutions around the world. According to the latest research from Dow Jones’ OPIS Chemicals Market Analysis Division, By 2050, global plastic waste will grow by 70%, and the current recycling infrastructure is far from meeting processing needs. A total of US$1.6 trillion in investment is needed to achieve complete recycling of plastics.

Moving to a circular economy faces multiple structural challenges:

1. The recycling system is not perfect

The reverse supply chain is disconnected from the production-export model;
Weak collection and sorting capabilities, especially in developing countries;
Raw material supply (waste plastic) is the key bottleneck restricting the recycling industry, not insufficient market demand.

2. The technical path is not yet mature.

Chemical recycling technologies (such as pyrolysis, gasification, depolymerization, etc.) are still in the early stages of development, with high energy consumption and large carbon emissions;
Although mechanical recycling is cheaper, it is difficult to handle mixed plastics and highly contaminated waste;
Emerging technologies such as selective solvent dissolution have not yet achieved scale effects.

3. Insufficient economics and policy support

Overcapacity of virgin plastics suppresses the market competitiveness of recycled materials;
Investment in recycling facilities is huge, and the world will need to invest approximately US$1.6 trillion by 2050;
Tax incentives and regulatory support are still incomplete, especially in the application of food contact grade recycled materials.

4. Conflict with carbon neutrality goals

The chemical recycling process has high carbon emissions, which may even exceed that of raw material production;
Circularizing plastics is not the same as eliminating fossil-based plastics.

— 2 —

Comparison and prospects of technical paths

On the technical path, the realization of circular economy relies on a multi-level solution system, with the order of priority being: consumption reduction, reuse/repair, mechanical recycling, chemical recycling, and finally energy recovery and landfill. Among them, Mechanical recycling It is the current mainstream technology, but it is mainly suitable for clean and single plastic categories, and often faces the dilemma of "downgrading recycling". chemical recycling (Including pyrolysis, gasification, depolymerization, etc.) has high hopes because it can process mixed and contaminated plastic waste and produce recycled raw materials with a quality close to that of virgin materials.

Currently, Global chemical recycling operating capacity is approximately 1.7 million tons/year, There is also a large amount of production capacity in the construction and planning stages, more than 75% of which is concentrated in Europe and North America. However, this technology is still in its early stages of development and faces challenges such as high energy consumption, large carbon emissions, and insufficient commercial feasibility.

Huge investment needs are another major barrier. The analysis pointed out that By 2050, a total investment of approximately US$1.6 trillion will be required to achieve complete recycling of plastics. More than half of that will be used for recycling facilities. Under the "Circular Plastics-2050" scenario, chemical recycling capacity is expected to surge by 427%, while the growth rate of virgin plastic production capacity will correspondingly decrease by 12%. However, the current severe overcapacity of virgin plastics has depressed market prices, which poses a serious challenge to the economics of recycled materials in the short to medium term, and the growth in demand for recycled materials is likely to be delayed.

— 3 —

The Chinese market: a key puzzle piece in the global circularity blueprint

As one of the world's largest plastic producers and consumers, China's recycling market is typical:

Recycling structure: torPET、rPP、rPE为主，占再生塑料总产量的70%以上；

Policy promotion: The government promotes the "integration of two networks" to integrate the municipal solid waste and renewable resource recycling systems;

Business participation: Companies such as Sinopec have begun investing in chemical recycling projects, and brands such as Coca-Cola and Adidas are also promoting the application of recycled materials;

Problems faced: There is a shortage of supply of waste plastics, low sorting efficiency, many regulatory restrictions, and dominance by small and medium-sized enterprises.

— 4 —

Future Outlook and Suggestions

In order to realize the large-scale development of plastic circular economy, multiple parties need to coordinate and promote:

Policy level: Strengthen legislative support, provide tax incentives and subsidies, and clarify the application standards of recycled materials in high-end scenarios such as food packaging.

Technical level: Increase investment in research and development of key technologies such as chemical recycling and intelligent sorting to reduce energy consumption and carbon emissions.

Industry chain collaboration: Promote petrochemical companies, brand owners, and recycling companies to form a closed-loop cooperation model.

Consumer and Brand Responsibility: Increase the proportion of green procurement, clarify the goals for the use of recycled materials, and enhance public participation.