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.