UK plastic recycling sector continues to suffer as oil prices plummet
The persistent low cost of crude oil is threatening plastic recycling firms in the UK, as manufacturers are finding it cheaper to buy newly produced plastic rather than recycled plastic.
The UK has already seen a number of plastic recycling centres close as a result of the plummeting crude oil price, which has dropped significantly over the last year, decreasing drastically from £78 to £35 per barrel initially, before dropping to the current rate of about £23 per barrel.
The Closed Loop Recycling factory, situated in Dagenham, was an early casualty of the oil price slump, when it ceased production in June 2015, resulting in 120 job losses.
A former director at the plant, James Samworth, told Sky News: “Oil makes up about 30% of the cost of ethylene, which is the raw material for a lot of plastic … When the oil price went from $110 to $50 that basically reduced the gross margins on this plant by about 40% in a matter of weeks…”
A spokesperson from the Department for Environment, Food and Rural Affairs said that it understands how these are troublesome times for the plastic recycling sector and that the UK Government and industry organisations are “developing and securing new markets for this valuable resource.”
However, other leaders in the plastic recycling sector, including Gary Claypole, from MBA Polymers, think that the UK Government is not doing enough to support the plastic recycling industry compared to other European countries.
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