Threatening bankruptcy for mixed plastic waste processing

Processing mixed plastic waste continues to cause problems. The company Plastinum from Emmen was supposed to ensure much more recycling of the plastic packaging waste collected in the Netherlands. Today, however, the bankruptcy of this company was filed for by FNV Bondgenoten, as November salaries have still not been paid. Recycling mixed plastic waste consistently seems to lead to fires or bankruptcies.

Over the past few weeks, reports (see also here) about the impending bankruptcy of Plastinum had already grown stronger. At the beginning of this year, investors were still enthusiastic when Plastinum was chosen to process a portion of the plastic waste collected from households in the Netherlands. At the end of March, a contract was signed with Nedvang, which in its press release envisioned a key role for Plastinum. Plastinum was to ensure that recycling results were raised to above 75% (which was already supposed to be a reality in March 2010 according to Nedvang, see also here).

Plastinum now seems to become yet another company to burn its fingers on plastic waste. At plastic recycling companies, this not infrequently leads to actual fires and bankruptcies. A few weeks ago, there was also a report in the media that 2,500 tonnes of plastic waste from a bankrupt recycling company was to be cleared by waste company Attero. This concerned the stored stock of the company ERS, which had already been declared bankrupt in April 2009. The clearance took place on behalf of the municipality, with a view to the fire hazard. Apparently, in the end, there was nothing better to do with this plastic waste than to burn it in the incinerators of Wijster and Bremen.

The question is what will now happen to the many tonnes of plastic waste that Plastinum was supposed to process. Plastinum had a contract with Nedvang to process plastic packaging waste that had been collected from households in the Netherlands and remained as a mixed fraction after sorting in Germany. In total, this contract involved an amount that could rise to 18,000 tonnes per year.

How could Plastinum's financial problems have arisen, precisely at a time when plastic prices are rising again? Plastinum was to work with the lowest-grade waste stream from German sorting plants and would not have had to pay for it. Our total output from German sorting plants does not generate money, the director of Nedvang recently even reported at a recent waste conference. It is therefore plausible that payment is made for the recycling of a significant part of the pre-sorted plastic waste streams, including the guarantees for it.

The most logical explanation for a bankruptcy of Plastinum is that the sale of the granulates does not generate enough money and that market demand is insufficient. And perhaps the quality of the granulate from the mysterious process is, after all, less than all the praise for Plastinum suggested. Or would the financial prospects have been dampened by the threatened abolition of the Waste Fund (Afvalfonds)?

In its press release of 2 April this year, Nedvang was still very sure of its case: "With this innovative technology, we expect to lift the percentage far above 75% recycling." It is unclear what a possible bankruptcy of Plastinum means for Nedvang's results. As far as those recycling results are concerned, there is already a great lack of transparency. Plastinum's black granulate makes everything even more opaque.

Robbert van Duin

Postscript: on 4 January 2011, suspension of payment was granted to Plastinum by the court in Amsterdam. It may remain unclear for another six months whether Plastinum can make a fresh start or survive. The creditors' meeting is scheduled for 6 July 2011. Read the official report here.

Processing mixed plastic waste continues to cause problems. The company Plastinum from Emmen was supposed to ensure much more recycling of the plastic packaging waste collected in the Netherlands. Today, however, the bankruptcy of this company was filed for by FNV Bondgenoten, as November salaries have still not been paid. Recycling mixed plastic waste consistently seems to lead to fires or bankruptcies.

Over the past few weeks, reports (see also here) about the impending bankruptcy of Plastinum had already grown stronger. At the beginning of this year, investors were still enthusiastic when Plastinum was chosen to process a portion of the plastic waste collected from households in the Netherlands. At the end of March, a contract was signed with Nedvang, which in its press release envisioned a key role for Plastinum. Plastinum was to ensure that recycling results were raised to above 75% (which was already supposed to be a reality in March 2010 according to Nedvang, see also here). Plastinum now seems to become yet another company to burn its fingers on plastic waste. At plastic recycling companies, this not infrequently leads to actual fires and bankruptcies. A few weeks ago, there was also a report in the media that 2,500 tonnes of plastic waste from a bankrupt recycling company was to be cleared by waste company Attero. This concerned the stored stock of the company ERS, which had already been declared bankrupt in April 2009. The clearance took place on behalf of the municipality, with a view to the fire hazard. Apparently, in the end, there was nothing better to do with this plastic waste than to burn it in the incinerators of Wijster and Bremen. The question is what will now happen to the many tonnes of plastic waste that Plastinum was supposed to process. Plastinum had a contract with Nedvang to process plastic packaging waste that had been collected from households in the Netherlands and remained as a mixed fraction after sorting in Germany. In total, this contract involved an amount that could rise to 18,000 tonnes per year. How could Plastinum's financial problems have arisen, precisely at a time when plastic prices are rising again? Plastinum was to work with the lowest-grade waste stream from German sorting plants and would not have had to pay for it. Our total output from German sorting plants does not generate money, the director of Nedvang recently even reported at a recent waste conference. It is therefore plausible that payment is made for the recycling of a significant part of the pre-sorted plastic waste streams, including the guarantees for it. The most logical explanation for a bankruptcy of Plastinum is that the sale of the granulates does not generate enough money and that market demand is insufficient. And perhaps the quality of the granulate from the mysterious process is, after all, less than all the praise for Plastinum suggested. Or would the financial prospects have been dampened by the threatened abolition of the Waste Fund (Afvalfonds)? In its press release of 2 April this year, Nedvang was still very sure of its case: "With this innovative technology, we expect to lift the percentage far above 75% recycling." It is unclear what a possible bankruptcy of Plastinum means for Nedvang's results. As far as those recycling results are concerned, there is already a great lack of transparency. Plastinum's black granulate makes everything even more opaque. Robbert van Duin Postscript: on 4 January 2011, suspension of payment was granted to Plastinum by the court in Amsterdam. It may remain unclear for another six months whether Plastinum can make a fresh start or survive. The creditors' meeting is scheduled for 6 July 2011. Read the official report here.