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In recent years, waste plastic chemical recycling has become a topic of global concern, collation and analysis of domestic and foreign scientific research and commercial development results conservatively estimated that the potential market size of chemical recycling is at the trillion level, it is expected that chemical recycling will account for 17% of the global waste plastic disposal market in 2030, but also the sanitation solid waste and petrochemical industry in the carbon neutral era of the "second growth curve".
01
The market potential is trillion-level
Incrementally, the Ministry of Housing and Urban-Rural Development, the Plastics Association, the Chinese Academy of Engineering and other relevant institutions data show that the average daily removal volume of domestic garbage in the mainland is about 1.1 kg, of which the quality of plastic waste accounts for 12.1%, which can be obtained, the total amount of new plastic waste in the mainland in 2021 may reach about 70 million tons, of which about 50% can be disposed of by chemical recycling.
In terms of stock, according to statistics, the cumulative output of plastic products on the mainland has exceeded 1.2 billion tons, of which more than 90% may eventually become garbage. The volume of plastic waste in landfills, which are only sources of domestic waste on the mainland, may be more than 400 million tons.
Due to the poor quality and inability to physically recycle, incineration pollutes the environment and wastes resources. Coupled with waste plastics from industrial, agricultural, medical, and hazardous waste sources, the waste plastics in the stale waste in mainland landfills may exceed 450 million tons, and chemical recycling is a key treatment technology in the future.
: China's development is at a medium level in the world, and the amount of waste generated per capita is basically at the global average. According to the population, the global waste plastic volume is about 5 times that of China, that is, about 400 million tons of plastic waste are added to the world every year, of which about 200 million tons can be recycled through chemical recycling. About 2.3 billion tonnes of waste plastics are found in landfills, perhaps only by chemical recycling.
3. Potential output value of chemical recycling: According to the actual production experience, taking the mainstream liquefaction process as an example, the chemical recycling conversion rate of fresh garbage is about 75%, and the chemical recycling conversion rate of waste plastics in landfill stale garbage is about 60%.
According to chemical price estimates in recent years, without considering the environmental protection premium, the chemical recycling market size of fresh plastic waste is in the level of 100 billion, and the market size of existing plastic waste is at the trillion level.
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Multinational giants are actively investing
1. In 2016, chemical recycling accounted for less than 1% of the global waste plastic disposal.
According to a McKinsey & Company study, 40% of the plastic waste generated worldwide in 2016 was landfilled, 25% was incinerated, 19% was abandoned into the environment, and only 16% was recycled. Of the 16 percent of the plastic waste that was recycled, physical recycling accounted for 12 percent and chemical recycling accounted for less than 1 percent, close to zero.
2. It is expected that the proportion of chemical recycling in the disposal of waste plastics in the world will reach 17% in 2030.
With the improvement of global waste plastic recycling technology and the increase in production capacity, it is expected that by 2030, the recycling rate of waste plastics is expected to reach 50%, of which physical recycling accounts for 22%, nearly doubled, chemical recycling accounts for 17%, and the growth space is huge.
The reasons for the sharp increase in the proportion of chemical recycling mainly include: (1) the presentation of rigid demand, the increase in tax revenue of 100% virgin plastics, and the enhancement of consumer environmental protection preferences, which increase the demand for chemical recycled PCR plastics; (2) the improvement of technical level, relevant policy encouragement, and future expectations increase the potential supply capacity of chemical recycled PCR plastics.
3. The relationship between physical recovery and chemical recycling: After decades of development, physical recycling has matured technology and market.
The relationship between physical recovery and chemical recycling is as follows: (1) From the perspective of raw material characteristics: physical recycling has a high cost performance and wide application in the treatment of high-value waste plastics such as PET and HDPE. Chemical recycling mainly deals with waste plastics that cannot be recycled by physical recycling, have low recycling efficiency or are downgraded to no longer be recycled after physical recycling, also known as "low-value waste plastics" ;(2) From the product characteristics: most of the physical recovery is downgraded recycling, and the proportion of products that can be applied to areas with high plastic requirements such as food and drugs is small. Chemical recycling recycles waste plastics into monomers and then polymerizes them, and the product quality is the same as that of virgin plastics, which can be applied to areas with high plastic requirements.
4. Giants actively invest in chemical recycling: As an important node in the development of the chemical recycling market, in 2018, the Ellen MacArthur Foundation and the United Nations Environment Programme launched the "Global Commitment to the New Plastics Economy", and chemical, packaging and brand giants have successively made commitments to transform the plastic circular economy from the concept of doing or not to the performance indicators of sustainable departments and product sectors of enterprises.
In order to fulfill the promise that plastic packaging contains a certain proportion of PCR components, the brand giant needs to find PCR plastic sources on a global scale, pass the pressure to the upstream packaging enterprises, and the packaging companies will pass the pressure to the upstream chemical enterprises, if the chemical enterprises do not have PCR plastic production capacity, it is difficult to meet customer needs. At the same time, more than 40 multinational companies with Leander Basel, SABIC, BASF, Shell, Dow, ExxonMobil and other chemical giants as the main members have established the "End Plastic Waste Alliance (AEPW)", committing $1.5 billion to help end plastic waste in the environment, while committing to providing customers with PCR plastics. Establishing and expanding PCR plastic production capacity and industrial chain has become an important strategy for chemical giants in recent years.
However, chemical companies have fewer reserves of chemical recycling technologies and projects, and in order to stably serve existing customers in the sustainable transition period and open up new markets for sustainable resins, chemical companies are actively investing in or integrating PCR plastic technologies and projects. In addition, brands and packaging companies are actively investing or partnering with chemical recycling companies to fulfill their global commitments while obtaining PCR plastics capacity at reasonable prices.
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The "Second Growth Curve" of the Carbon Neutral Era
1. Chemical recycling will become an important technology in the carbon neutral era with excellent carbon reduction effect. As the Paris Agreement sets a goal of achieving net zero emissions by the second half of this century, more and more governments are translating "carbon neutrality" into national strategies, and the era of carbon neutrality has begun. According to the estimation of Como Chemical Recycling Research Institute, the use of chemical recycling to treat about 200 million tons of new low-value plastic waste in the world can reduce carbon by about 400 million tons; if in the next 20 years, chemical recycling can reduce carbon in the world's landfill waste waste, about 230 million tons of carbon per year, and the carbon reduction effect of chemical recycling is more than 600 million tons per year, exceeding the annual carbon emissions of more than 180 countries around the world.
2. Chemical recycling may be one of the biggest profit growth points in the petrochemical industry in the future. Over the past 20 years, the profitability growth of the petrochemical industry has mainly come from technological advances and advantageous raw materials. Low-value plastic waste could be the next source of advantageous raw materials for polymer production. It is expected that in the next 10 years, plastic recycling as a polymer raw material is likely to contribute two-thirds of the profit growth of the petrochemical industry, and chemical recycling alone accounts for 40%. It is estimated that by 2050, nearly 60% of plastics will use recycled plastics as raw materials, and the contribution of chemical recycling to the petrochemical industry may exceed 50%, becoming the "second growth curve" of the petrochemical industry in the next era.
3. Waste plastic chemical recycling will become a core battlefield for the disposal of domestic waste at the end. Kemao Chemical Recycling Research Institute believes that the possible reasons are: (1) at the beginning of the "Fourteenth Five-Year Plan", the state will no longer plan and build new primary waste landfill facilities in principle, the construction of incineration facilities will tend to be saturated in the next few years, and solid waste enterprises urgently need to find new growth points; (2) As the policy begins to support the promotion of garbage classification, recycling and plastic pollution control, the availability of important raw materials for chemical recycling (mixed low-value waste plastics) is getting stronger and stronger, and the increment and stock are huge; (3) the sustainable strategic transformation of chemical, packaging and brand enterprises. (4) Most of the original value of garbage is not high, the value of recycling can be limited, and the value of plastic itself is high (for example, the price of polypropylene is more than 8,000 yuan), but it is limited to the backward technology in the past, and it is difficult to recycle once it is mixed or contaminated. In the case of a breakthrough in the technical bottleneck, waste plastic chemical recycling is one of the few tracks with its own profits in the field of garbage disposal, and the marketization potential is huge. Waste plastic chemical recycling may be one of the few big blue oceans in the field of sanitation solid waste in the next 5 to 10 years.
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The world's largest market is in China
China has the potential to become the world's largest market for the following reasons: (1) China has a population of 1.4 billion, many large cities, high population density, and has the world's largest plastic waste volume and concentration; (2) with the implementation of Policies such as China's garbage classification, waste-free city, circular economy, and more and more clear garbage resource targets, plastic waste that was not separated in the past can gradually be separated from garbage at a lower cost and with higher efficiency; (3) if plastic waste is separated in large quantities, because of its mixing and pollution, Chemical recycling will become an indispensable solution for the reduction, harmlessness and resource utilization of plastic waste; (4) China's chemical recycling enterprises have accumulated more than 10 years of technology and have the world's cutting-edge technology, although in the short term, they are still limited by imperfect policies, but have the basis for large-scale rapid development.