From Fragmented to United: Plastics Go Circular

An EU-backed alliance is speeding recycled plastics adoption, easing supply pressure and regulatory risk for companies that act early

13 Jan 2026

Europe’s plastics industry is accelerating its shift towards recycled materials as tougher EU rules and rising demand for sustainable products turn earlier pilot schemes into a more coordinated industrial effort.

At the centre of this push is the Circular Plastics Alliance, a Europe-wide initiative supported by the European Commission that brings together manufacturers, recyclers, brand owners and public authorities. While not a commercial deal, the alliance is increasingly shaping how the sector plans investment and supply, aligning a value chain that has long operated in isolation.

The urgency is driven by regulation. New EU policies are raising minimum recycled content requirements for packaging and other applications, forcing companies to secure reliable access to recycled feedstock. Demand for recycled plastics is now running ahead of supply, exposing weaknesses in collection systems, recycling capacity and long-term contracting.

The alliance aims to narrow that gap by encouraging collaboration rather than competition between different parts of the industry. Its goal is to help scale recycled plastics use across Europe by improving coordination on standards, infrastructure and investment planning.

Large producers are already adapting their strategies. Groups such as BASF and Borealis have linked long-term plans to the alliance’s targets, signalling that recycled materials are becoming a core part of future growth rather than a narrow compliance exercise. For bigger companies, coordinated action offers clearer visibility on regulation, lowers investment risk and improves access to limited supplies of recycled material.

Policy advisers involved in the initiative say the collective approach is helping to build confidence on both sides of the market. Companies gain greater certainty that regulatory targets are achievable, while policymakers see stronger evidence that industry can deliver at scale.

The impact is spreading beyond producers. Brand owners benefit from more predictable supply, recyclers from steadier demand, and consumers from wider use of recycled content in everyday products. Smaller firms, however, continue to face challenges, including higher costs and fewer resources to secure high-quality recycled plastics at competitive prices.

Despite these constraints, the direction of travel is clear. Collaboration is becoming a central feature of competition in Europe’s plastics sector. As the Circular Plastics Alliance grows, it is offering a template for how the industry adapts to a market in which sustainability has become a defining commercial condition rather than an optional add-on.