Europe’s PET sector sits at a crossroads. Technical expertise and strong collection rates suggest a story of success: in leading countries, nearly nine out of 10 PET bottles are recovered, while the continental average is seven in 10.
Yet, beneath the surface, the industry faces a complex mix of economic pressures, regulatory uncertainty, and growing competition from imported materials.
Antonello Ciotti, president of Petcore Europe, offers a candid assessment of the challenges.
“The European landscape is not promising because we have stringent European legislations that are increasing costs for the European manufacturers. At the same time, we have a disparity in the energy cost. That is well known and is hitting all the industries in Europe,” Ciotti explains.
Europe also cannot effectively verify compliance with these regulations, he adds, especially when it comes to checking the declared recycled content of imported PET.
The consequences are tangible. Over the past 12 months, Petcore, a trade association representing the complete PET value chain across Europe, estimates that nearly 1 million tonnes of European recycling capacity has been shut down. This, it states, is partly because imported PET flakes and resins often cannot be verified for compliance with European standards.
“We’re seeing resins with very high declared recycled content that simply do not make economic sense, and no one can verify whether it is correct,” Ciotti continues.
To improve monitoring, Petcore has formally requested that the European Commission’s Directorate-General for Taxation and Customs Union (DG TAXUD), introduces new TARIC codes to enable better tracking and verification of imported rPET, because current classifications do not distinguish between different recycled inputs.
TARIC, roughly translated as the integrated tariff of the European communities, is a multilingual database integrating all measures relating to EU customs tariff, commercial and agricultural legislation.
“We’re asking DG TAXUD to introduce two new TARIC codes by 26 January, one for PET flakes and another for resin with recycled content,” Ciotti explains. “Currently, all PET flakes and rPET fall under the same TARIC code, which does not allow proper monitoring of the situation.”
Recycling
Despite these pressures, Europe retains a technical advantage. Mechanical recycling is largely mature, supported by advanced sorting systems such as Italy’s COREPLA network, the national consortium for the collection, recovery and recycling of plastics packaging, which separates municipal plastics waste into roughly 15 distinct streams. This allows high-quality rPET production and underpins the sector’s circularity ambitions.
Chemical recycling is emerging as a solution for materials that can’t be processed mechanically, including textiles, composite packaging, and multilayer films. Investment in chemical recycling depends on regulatory clarity and adoption of the mass balance approach, which allows producers to account accurately for recycled content in outputs.
“Without a mass balance framework clarifying how the various outputs from a chemical recycling plant qualify as recycled, the industry cannot confidently invest, since it is unclear how much of what is produced counts toward recycled content,” Ciotti says.
Artificial intelligence (AI) is another area where the industry sees potential. Based on Petcore’s estimates, Ciotti highlights that AI could improve sorting efficiency, expand recycling capacity, and reduce operational costs on recycling lines.
“This is, for me, the big bet that we have to have for the near future,” he says. “Long-term, there are new potential applications for PET and I am confident that Europe will react, because if we stay as we are today, not only the PET industry is in danger, but all manufacturing is in danger in Europe.”
Ciotti identifies three priorities to advance PET circularity: establishing global design-for-recycling guidelines, implementing mandatory extended producer responsibility schemes, and reducing the production of items that cannot be recycled.
Taken together, he believes these measures could dramatically improve the system. “These three points will increase by far the circularity of PET, which is already the most circular product today,” he adds.
Regulation
The EU Single-Use Plastics Directive currently mandates a 25 per cent recycled content target for PET beverage bottles, rising to 30 per cent by 2030. Compliance is measured at the Member State level rather than by company, allowing a country to meet targets even if individual brands underperform.
Ciotti is blunt about the limitations. “The target is not per company, but per Member State,” he notes. “So, if a Member State has a brand with 75 per cent and another brand with zero, the state is complying with the directive.
“What we’re asking, and what will happen under the EU Packaging and Packaging Waste Regulation by 2029, is that targets will be set per country, bottle size, and production site. This will be game changing. It’s very specific and it will be very difficult to get out of that.”
Economic pressures intensify these regulatory challenges. Collection and sorting costs in Europe average around €500 ($588) per tonne, roughly five to 10 times higher than in parts of Asia and North Africa, while energy costs remain elevated. Combined with fluctuations in virgin and rPET pricing, this has led some brands to reduce recycled content despite growing demand.
“The gap between the two became too wide, and as a matter of fact, brands reduced on average the recycling content,” Ciotti points out.
He warns that these high collection costs put European recyclers at a competitive disadvantage compared with non-European countries, where costs can be a tenth of Europe’s. This imbalance, he explains, undermines investor confidence in building new capacity in the continent, even though demand for rPET is growing.
Food-grade PET
PET intended for food and beverage packaging must comply with EU food‑contact safety regulations, which include limits on the amount of non-food PET allowed in the input to food-grade recycling processes.
Under current EU rules, mechanical recycling processes must ensure that no more than 5 per cent of the input comes from containers that were not previously used in food contact. This requirement is part of how authorities and the European Food Safety Authority assess whether rPET is safe for food packaging applications.
“In the case of PET, it is clear that much of what we use in Europe comes from food and beverage applications, which helps meet safety requirements,” Ciotti says. “The problem is how to check that the food-grade rule is applied when you import material coming from India, from Indonesia, even from Egypt or Morocco, where compliance can be difficult to verify.”
All of these issues and more will be discussed at the upcoming Petcore Europe Annual Conference, to be held in Rome on 5-6 February.
The conference brings together industry stakeholders, policymakers, and research bodies, including ICIS, which is partnering with Petcore for the first time.
The two-day event in Rome will cover a broad spectrum of issues shaping PET circularity in Europe. Sessions will examine upstream market dynamics, price developments for PET and rPET, and the impact of global trade on European markets.
Regulators from the European Commission will discuss policies to support secondary raw materials, traceability, and anti-fraud measures, while industry experts will share innovations in mechanical and chemical recycling, food-grade PET, and digital solutions for tracking recycled content.
The conference will also explore the role of Extended Producer Responsibility, design-for-recycling standards, and emerging applications such as polyester textiles and heat-resistant packaging.
The event will be held entirely in person to encourage networking and dialogue, with Ciotti framing the conference as a vital bridge between Brussels institutions and the business community.
“We want attendees to leave with new ideas, a better understanding of how we can improve our communication with the institutions, and also the other way around,” he adds. “Rome is a fantastic opportunity to touch base on all these points.” For more information about the Petcore Europe Conference 2026, or to register to attend, visit: www.petcore-europe.org
