Viridor to Shut Down its Avonmouth Mechanical Recycling Plant in UK

Viridor has announced the difficult decision to propose the closure of its mechanical recycling facility in Avonmouth, following a detailed strategic review. The company has also begun a separate review of its site at Rochester. Viridor’s UK mechanical recycling operations have faced persistent and increasingly challenging market conditions, compounded by the lack of new legislation aimed at increasing plastic recycling rates in the UK, which has significantly impacted the financial viability of its operations.

In recent years, Viridor has made substantial investments to enhance its mechanical recycling capabilities. Over the past four years, it has developed and launched the Avonmouth polymers recycling facility, aimed at boosting the UK's plastic recycling efforts. Despite this, recycling rates have consistently fallen short of projections, with figures still lower than what was anticipated in 2020. The UK government’s 2018 Resources and Waste Strategy outlined policies designed to improve recycling rates and reduce plastic waste, but these measures have been repeatedly delayed and have yet to be fully implemented. This delay in policy rollouts has directly hindered the growth of recycling infrastructure, making it difficult for businesses like Viridor to operate sustainably within the sector.

At the same time, demand for recycled plastic products, particularly from the consumer goods industry, has diminished. The downturn in demand has been exacerbated by global market conditions. The virgin polymer market is experiencing significant overcapacity, driven by increased production in lower-cost regions outside of Europe. This has led to a decrease in demand and falling prices for recycled plastics, making it harder for Viridor to compete. Moreover, the importation of recycled plastics from low-cost countries has flooded the European market, displacing domestic supplies and further pressuring the profitability of local recycling operations.

These combined challenges—policy delays, reduced demand for recycled plastics, and the broader global market shifts—have left Viridor with no choice but to propose the closure of the Avonmouth site. This decision is especially difficult for the employees at Avonmouth, who have worked tirelessly to make the site’s operations commercially viable under extremely tough market conditions. Viridor has emphasized that the proposed closure will undergo the usual consultation process, and the company is exploring redeployment opportunities for impacted employees within the wider Viridor business.

Despite this setback, Viridor remains committed to advancing the circular economy, a core principle of its business model, as well as driving the UK’s Net Zero and decarbonisation objectives. The company continues to invest heavily in the UK’s waste management and decarbonisation infrastructure. Notably, its Runcorn site is a key component of the HyNet industrial decarbonisation cluster, which was selected earlier this year by the UK government to progress as part of the nation’s broader carbon reduction efforts.

Viridor is also continuing its focus on polymer recycling through its subsidiary, Quantafuel, which was acquired for approximately £100 million in 2023. The company is dedicated to building an efficient recycling business that can support the development of chemical recycling infrastructure. This is being pursued through Quantafuel’s joint venture with Resource Denmark, which aims to bring innovative recycling technologies to market. Through these investments, Viridor hopes to ensure that its operations remain aligned with the evolving needs of the recycling industry, even as it confronts challenges in the mechanical recycling sector.