Fortune - USA (2020-04)

(Antfer) #1
Nestlé, PepsiCo, and Procter & Gamble—have argued that
improving these recycling numbers is the solution to the
plastic-waste crisis. They frame the problem as one of be-
havior—ours. “It’s a knee-jerk reaction to say the problem
is with plastic,” Tony Radoszewski, president and CEO of
the Plastics Industry Association, tells me. “The culprit is
the consumer who does not dispose of products properly.”
It’s true that recycling rates are low. But to blame that
fact on consumers alone is disingenuous. The bigger
problem is a huge shift in energy markets. Prices for oil and
natural gas have plummeted over the past decade. That in
turn has made it far cheaper for petrochemical companies
to produce virgin plastics than for factories to create re-
cycled plastic. And with big profits to be made, companies
have sharply increased virgin production, further driving
down prices. Recycling used plastic is labor- intensive and
therefore expensive—and the shifting economics now work
against recycling in much of the world.
In 2018, this ecosystem endured another major blow
when China halted the importation of almost all plastic
scrap, saying that its own recycling industry was becoming
an environmental hazard. The decision has caused chaos in
the world’s plastic-resuscitation economy. Up until then, for
example, the U.S. had been sending about 70% of its plastic
waste to China. Now, “recycling is on life support,” says
Mike Engelmann, solid waste coordinator for Smithtown,
N.Y., a town of 120,000 people on suburban Long Island.
“Hopefully things will turn around. But I am not sure how.”
One turnaround option, curbing the production and use
of virgin plastics, faces long odds, given the petrochemical
and energy industries’ political clout. Indeed, a thriving
plastics market has become pivotal to the energy sector’s
long-term health. As automakers transition to electric ve-
hicles, and renewable energy takes off, plastics will pick up
the slack in oil-and-gas industry growth, according to the
International Energy Agency. It estimates that petrochemi-
cal feedstocks, much of which go to make plastics, could
rise from 12% of total global oil demand today to 22% in
2040—at which point the agency says feedstocks could be
the only segment of the industry that’s growing at all.
It’s no surprise, then, that big companies’ responses to
consumer concerns don’t emphasize the supply side. In
January, big players like Dow, DuPont, Chevron, P&G, and
other major players launched the Alliance to End Plastic
Waste. The plastics crisis “demands swift action from all of
us,” P&G CEO David Taylor told reporters.
But “swift action” did not include cutting production.
Instead, companies committed to spending $1.5 billion
over five years on projects to reclaim and recycle waste.
Christman of the American Chemistry Council cites as one
example the Renew Oceans project, which targets plastic
pollution in India’s Ganges River. He says the alliance aims
to make plastic packaging “100% recyclable” by 2030 and
to make sure it all goes into the recycling stream by 2040.

But when I ask who will bear the enormous
cost of recycling such a mammoth amount,
he hesitates, then says, “This will take fund-
ing. Part will come from industry, part from
governments.”
Environmentalists say the sheer life
span of plastics undermines that argument.
What’s more, as Geyer’s research points out,
most plastic that’s recycled after first use
can’t be recycled again. Put another way:
Almost every new piece of plastic we add to
the planet may well stay here—along with
almost all the old ones.

O

N A STEAMY AFTERNOON,
plastics trader Steve Wong
sits at a small sidewalk
eatery in the city of Ipoh, in
central Malaysia. He’s meet-
ing an old client, Saikey Yeong, CEO of local
recycler AZ Plastikar. Under a roaring fan,
the two men sit down to business over plates
of spicy dumplings and pork rolls, washed
down with jasmine tea. Their table is plastic,
and so are their yellow chairs.
Wong takes out several bags and lays the
contents in front of Yeong. In one are bits of
clothing hangers he has collected from Paris
fashion houses. In another is a tangle of plas-
tic rope, the remnants of a polypropylene fish-
ing net, which Wong acquired in the Nether-
lands. Hunched over the table, the men pull
apart the net to check the polymers, at one
point holding the flame of a plastic lighter
up to the strands, to smell the smoke and
determine its chemical makeup. “Look, this is
good—we can recycle this, and there is a lot of
it,” Wong tells Yeong. “The fishermen usually
just dump this at the bottom of the sea.”
Wong is CEO of Fukutomi Recycling, a
venerable name in the plastics industry,
which he founded in 1984 in Hong Kong. He
has the rough-and-ready mien of a door-to-
door salesman, which, in a sense, he is. He
spends much of his time traveling between
the U.S., Europe, and Asia, attempting to
match the hundreds of different polymers in
plastic waste with whichever factories can
process them. It is in settings like these—
over $5 lunches and endless pots of tea,
rather than in sleek corporate boardrooms—
that crucial recycling deals are really decided.

A PLANET IN CRISIS : THE PLASTIC FLOOD

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