If the war in Ukraine can teach us something, it is that production chains become vulnerable when market mechanisms undergo unforeseen changes. The war conflict and the resulting sanctions continue to affect many recycling companies. The first impact we have since the war comes on the side of high energy prices, followed by shortages of raw materials and rising fuel prices for transport.
International cooperation with common rules - facilitating access to raw materials in Europe - would reduce risks and sustain a more stable waste market in future crises.
Rising energy prices
The crisis in Ukraine has brought the prices of energy and raw materials to the highest levels in history.
Russia and Ukraine are among the world's largest exporters of natural gas and oil. The prolongation of the crisis could have a significant impact on Europe's energy supply. This would mean a lot of measures to be able to produce and deliver on time. Despite the increase in product prices, energy, raw materials and transport capacities are needed to reach customers.
The current extremely high electricity prices are forcing the production stoppage of various recycling companies, pending standardization of electricity tariffs.
Shortage of waste as a raw material
The waste industry is among the first to receive signs of economic change. Household consumption and the level of production in the business sector have a direct impact on the total amount of waste. Another example of the current shortage of raw materials is found in the supply of wood. Russia was a major supplier of wood to the paper industry and waste recovery plants across Europe.
These volumes will always vary, but the significant drop we are currently witnessing leads to a shortage of raw material for sustainable recycling of materials.
The war between Russia and Ukraine has an impact on the recycling industry.
More expensive transport
The war is also affecting transport capacity on the European continent. The price of diesel for road transport had never been so high and in a few months the price of fuel for ships has doubled. This additional cost is added to the value of transport, significantly affecting the recycling industry.
