Plastic Recycling Turns Cautious in the Wake of Iran War

The approach of the summer holidays in many parts of the world is usually a quieter time when trading activity is more muted. This year, however, the immediate pre-holiday period has witnessed a major development with the renewal of US strikes on Iran.

· Renewed US strikes on Iran have ended the recent decline in crude oil prices, causing virgin polymer prices to rise again.

· The development follows a period of easing tensions under a 60-day ceasefire, creating fresh uncertainty for global markets.

· The summer holiday season has reduced production and trading activity across the plastics sector.

· Many buyers accumulated large inventories during March–May due to fears of supply disruptions, reducing current purchasing needs.

· Buyers are delaying new orders, while low-priced imported materials continue to pressure the European market.

· Plastics recyclers are experiencing a slower market but remain supported by strong order books built up in previous months.

· Market recovery in September will depend on inventory depletion, post-holiday industrial demand, and the direction of the Iran conflict.

· Virgin polymer prices and the broader economic outlook will continue to influence buying decisions in the near term.

· The overall market sentiment remains cautious, with both buyers and sellers waiting for clearer signals.

· Despite the short-term slowdown, the long-term outlook for plastics recycling remains positive, supported by:

o European recycling legislation,

o Mandatory recycled content requirements,

o Increasing recognition of recycled materials as strategically important resources.

[ABSS News Service/10.07.2026]

After several months of geopolitical uncertainty, tensions in the Middle East had appeared to be easing following the announcement of a 60-day ceasefire. But with the USA renewing its strikes on Iran several days ago, the recent substantial fall in crude oil prices has been reversed and virgin polymer prices have also started to climb again. This evolving situation could have massive repercussions for our market going forward.

This major development has come at a time of softening demand. As is typical for this time of year, the approaching summer holiday season has been leading many plastics processors to reduce production levels. In addition, many buyers built up significant inventories during March, April and May as a precaution against potential supply disruptions arising from the conflict in the Middle East. Those inventories have not yet been fully consumed.

Many buyers are keeping their order forms in their drawers for the time being. Trading activity has slowed, while competitively-priced imported materials continue to exert pressure on the European market.

For recyclers, this has resulted in a quieter market environment. Fortunately, many companies are still benefiting from the strong demand experienced over the past few months, during which order books were healthy and production facilities operated at high utilisation rates. Those earlier orders are helping many recyclers navigate what is traditionally a slower summer period.

The key questions now are what direction the Iran conflict will take and how the market will develop after the holiday season. If inventories continue to decline throughout August and industrial activity resumes as expected after the summer break, demand could recover during September. However, the direction of virgin polymer prices and the broader economic outlook will continue to influence purchasing behaviour in the short term.

For now, caution remains the prevailing sentiment across the market. Both buyers and sellers are closely monitoring developments while waiting for clearer market signals. Nevertheless, the long-term outlook for plastics recycling remains positive: European legislation, mandatory recycled content requirements and the growing recognition of recycled materials as strategically important resources continue to provide strong structural support for the industry, despite the current short-term slowdown.