Commentary | Recycling: An equation of supply and demand

Extended producer responsibility (EPR) often is described as a cornerstone of the circular economy. And it is. By shifting the financial and operational responsibility for packaging waste to producers, EPR helps fund collection systems and improves material recovery. That’s real progress.  

But here's the hard truth. If we do not make sure there are end markets to turn all that old stuff into new stuff, EPR alone will not deliver a circular system.   

Why? Because supply without demand is a broken equation. 

The demand gap: The missing piece in circularity 

Across the U.S. and globally, policymakers and industry leaders are investing heavily in systems to collect and process recyclables. That investment matters. But it’s only half the story. If we don’t simultaneously create strong, consistent demand for recycled content, we risk building a supply chain with nowhere for those materials to go. 

Think of it this way: We can collect every box, can, bottle, tub and even flexible film. But if packaging producers and brands aren’t buying recycled content at scale, ensuring those materials are put back into the marketplace, those materials pile up, prices dip and recycling infrastructure falters. When that happens, public trust erodes and the entire system becomes more fragile.  

California’s recent EPR legislation acknowledges this reality. While it sets ambitious recycling targets, it also underscores the need for end-market development. Without clear signals from brands and manufacturers that they will purchase recycled content, the system stalls, and the promise of EPR remains unfulfilled. 

Lessons from Europe the U.S. doesn’t need to repeat 

Europe is facing the same challenge under its new Packaging and Packaging Waste Regulation (PPWR). The regulation, which went into force in February 2025, mandates that all packaging be recyclable by 2030 and sets binding recycled content targets. These include 30 percent recycled plastic in single-use beverage bottles by 2030 and up to 65 percent by 2040. It also requires minimum recycled content for other plastic packaging types, ranging from 10-30 percent by 2030, with higher thresholds by 2040.  

These measures are designed to accelerate circularity, but they also expose a critical vulnerability. Europe’s recycling system already is showing what happens when demand falters. According to Plastics Recyclers Europe, nearly 1 million tons of recycling capacity have shut down since 2023, with seven facilities closing in the Netherlands alone. Without strong and reliable end-market demand for recycled materials, compliance becomes nearly impossible. When virgin plastic prices drop, recyclers struggle to compete. The PPWR makes it clear: Supply-side measures alone won’t close the loop. Without clear demand signals from brands, backed by procurement commitments and collaborative purchasing strategies, these policies cannot succeed in practice.  

Why EPR is only half of the story 

EPR is designed to fund collection and processing, and those are essential pieces to a healthier system. But EPR does not necessarily guarantee demand. And demand is what makes recycling economically viable. When recycled resin must compete with virgin plastic that often is cheaper and more predictable, processors struggle to justify investment. The result? A fragile system vulnerable to market swings. We’ve seen this before. When oil prices drop, virgin resin floods the market, and recycled material demand collapses. Without consistent demand, the system remains unstable. 

Policy can help fix the equation  

To close the demand gap, we need a combination of smart policy and bold corporate leadership.

On the policy side, governments must do more than fund collection systems. While some EPR programs include demand mechanisms, many do not. Policies must actively stimulate demand, and we must explore new policy structures. That means incorporating demand elements into EPR laws, setting minimum recycled content mandates to guarantee a baseline market, offering incentives for brands that go above and beyond and enforcing penalties for noncompliance to ensure a level playing field for responsible actors. 

But policy alone won’t get us there. This is where sustainability leaders at major brands play a critical role. Driving demand for recycled content isn’t just a procurement decision. It isn’t just about meeting targets. Embedding recycled content into the DNA of packaging design and purchasing decisions is a strategic business decision. By committing to this path, brands send a powerful message to the market: We will buy what you produce. 

Scale matters here. When companies aggregate demand, they stabilize pricing and send a clear signal that the market for recycled materials is real, reliable and growing. It gives recyclers confidence to expand capacity. It attracts capital to innovation in sorting, processing and advanced recycling. And it creates the virtuous cycle that benefits people and planet alike. 

What happens next? 

We don’t have to imagine the consequences of a demand gap in the U.S. recycling system. We are already seeing the signs. The temporary closure of WM’s Natura facility for film and flexible plastics in Texas and the shutdowns of rPlanet Earth’s polyethylene terephthalate operations in California and Phoenix Technologies in Ohio are clear market signals. Demand for recycled content was not strong or reliable enough to sustain them.  

Collection without end markets simply doesn’t solve. Every dollar invested in recycling infrastructure without a corresponding commitment to demand puts the entire system at risk.  

Now consider what happens if we get this right. A healthy market for postconsumer recyclables can anchor resilient North American supply chains, support skilled American jobs, stabilize manufacturing costs and keep critical materials circulating at home. That is how we move from fragile progress to a durable circular economy, and why strong demand signals are not optional. It is the foundation of the future we say we want.  

To those concerned about building solid supply chains: This is your moment. Circularity only works when recycled materials are consistently valued, purchased and used. That’s how we solve the equation and move from aspiration to reality. 

Keefe Harrison is CEO of The Recycling Partnership, which is headquartered in Washington. Learn more at https://recyclingpartnership.org.