The Circulate Initiative flags supply chain insecurities in Asia’s plastic waste management

15 Feb 2023 --- The Circulate Initiative has published a report mapping the plastic recycling supply chain and infrastructure in four Asian countries – India, Indonesia, Thailand and Vietnam – to better understand localized plastic waste management systems and identify where interventions can be made.

The research undertakes a detailed assessment of “wastesheds,” which the report defines as a geographical region with a common solid waste disposal system or an area designated by the governing institutions as appropriate for developing a common recycling program in each country.

“While there is a range of existing studies on national waste flows, few explore the plastic supply chains in more localized contexts,” The Circulate Initiative details.

“Recognizing this need, together with our lead research partner Anthesis Group, we produced four reports, Mapping Local Plastic Recycling Supply Chains: Insights from Selected Cities in India, Indonesia, Thailand and Vietnam.”

The non-profit organization says that several conditions must be met for local supply chains in all four countries to be more effective, including demand for recyclates, regulatory and policy framework, transparent pricing for equitable distribution of value and efficient handling of the supply chain for social and environmental sustainability.

Regarding the risks involved with the reliance on the informal sector for waste collection, the initiative asserts: “Leaving recycling activities to the informal sector results in supply chain insecurity for recyclers and is often a barrier to investment in local plastic supply chain infrastructure. In addition, there tends to be a focus on collecting the most valuable polymers only, leaving large amounts of plastic waste uncollected or leaked into the environment.”

There remains a high reliance on the informal sector for the collection in Asian countries.India
Three Indian wastesheds were selected for plastic waste mapping – Delhi, Mumbai and Chennai. It was found that the three cities have well-established informal plastic waste recycling systems, which come with environmental and welfare issues.

“India is estimated to have over 7,500 registered and unregistered recyclers, who collectively recycle approximately 60% of the plastic waste generated (or about 5.6 metric tons per year),” the report states.

“The plastic waste supply chains in the three wastesheds in India indicate an imbalance in market power, which mostly benefits recyclers in the supply chain and negatively impacts collectors and aggregators.”

Additionally, while the recycling performance was found to be strongest for PET, it is less capable of retaining the value of material than recycled high-density PE and recycled PP, which might be due to general market prices or quality of the recyclate, The Circulate Initiative positions.

The report details that an estimated 30% of plastic waste in India is mismanaged – littered, informally burned or dumped. It also spotlights that almost US$133 billion worth of plastic material value in the country will be lost between 2020 and 2030 due to unsustainable waste management practices.

Indonesia
The report estimates that across Indonesia, only 10% of plastic waste is recycled at dedicated facilities – the majority is landfilled, illegally dumped or burnt.

The reviewed wastesheds in Indonesia – Greater Jakarta, Makassar and Surabaya – have a dynamic and extensive network of collection and potential sorting sites. However, The Circulate Initiative reports that “there is little transparency across the country and the role of aggregators seems to be more limited – not necessarily fitting with the value chain price points collated.”

“The domestic plastic waste flowing through the system into recycling is still small and it is currently competing with plastic waste imports, which are able to deliver quantities more reliably and often of better quality, therefore easier to handle for recyclers.”

The sustainability consultant suggests implementing a formalized door-to-door collection system for recyclables, increasing funding for waste collection infrastructure, implementing source-segregated collection and EPR systems and conducting campaigns for behavior change to encourage segregation.An estimated 30% of plastic waste in India is mismanaged – littered, informally burned or dumped.

Thailand
The Circulate Initiative reports a comparison between three wastesheds in Thailand – Bangkok, Chon Buri and Rayong – shows that the market structure for reprocessing is strong, with multiple companies having developed formal treatment capacities for recycling. However, all wastesheds still rely on the informal sector for the collection of recyclables.

PET was found to have the highest demand, with the recycling rate estimated at 80%.

The organization elaborates that the plastics industry contributed THB 1,100 billion (US$36.9 billion) to the national economy in 2018, comprising 6.71% of Thailand’s GDP. 

“Despite high domestic demand, it is estimated that only approximately 20% of plastic waste generated is collected for recycling, with 250 kilo metric tons per year imported into Thailand to support manufacturing activities,” it states.

Interventions recommended by the non-profit are aimed at improving collection rates, increasing sorting and segregation of plastics for recycling, and enabling growth in plastics recycling for a circular economy will contribute to scaling up the supply chains in all three wastesheds.

Vietnam
The Circulate Initiative selected Hanoi, Ho Chi Minh City and Da Nang as wastesheds for plastic waste mapping in Vietnam.

“In Vietnam, the management of plastic waste in the wastesheds has many commonalities due to the dominance of the national and local administration in the country’s waste management services, with limited involvement of the private sector,” it details.

“Data collected through interviews in Vietnam highlight the lack of consistency in the price points which can be ‘expected’ by collectors selling plastic scrap, aggregators buying plastic waste, and recyclers buying feedstock for recycling.”

Despite high domestic demand in Thailand, it is estimated that only approximately 20% of plastic waste generated is collected for recycling.Recognizing the gaps limiting the effectiveness of existing local plastic waste recycling supply chains across the wastesheds, the organization suggests a need for guidance, funding and monitoring to ensure effective implementation of legal frameworks by local governments. 

Additionally, it recommends providing a clear administrative pathway for operating and building permits for recycling facilities, making domestic materials comparably more favorable through supply chain improvements, and further exploring the feasibility of developing formal reprocessing infrastructure in Da Nang.

Asian waste management systems
The Circulate Initiative recognized the need to explore supply chains in more localized contexts in Asian countries. 

“Though many urban areas of India, Indonesia, Thailand and Vietnam have municipally-managed waste collection, there remains a high reliance on the informal sector for the collection, aggregation and recycling of plastic and other valuable materials,” it states.

“Plastic recycling supply chains are local and unique as they rely on these informal transactions, which are driven by local conditions, traditions and cultures, as well as local and regional infrastructure and markets.”

Accordingly, the organization suggests individualized interventions for local plastic recycling supply chains, including the key actors, infrastructure and influencing regulations.

By Radhika Sikaria