Does Redcycle’s collapse prove retail needs alternatives to plastic?


Last week, soft plastics recycling program Redcycle paused its nation-wide collection program and revealed it had been stockpiling plastics collected from the supermarket sector for months, rather than recycling them as it had said it had been.

The collapse left Australia’s supermarkets, as well as various parts of the retail industry that relied on Redcycle, without a meaningful recycling option at a time that consumers want more than ever to support climate conscious business. 

And while the industry has in part gathered around Redcycle, with founder Liz Kasell telling Packaging News that the support they had received in recent days has been “incredible”, the issue is partly of its own making.

According to Kasell, the pandemic led to a 350 per cent increase in recycling supply, but that demand for recycled output fell 95 per cent, leaving them with a circular system that no longer balanced out. 

Julie Mathers, founder of Flora & Fauna and CEO of Snuggle Hunny told Inside Retail the situation was unfortunate, but inevitable.

“[Redcycle] claims they’re collecting up to 5 million items a day. That’s almost 2 billion items a year,” Mathers said.

“As far as I’m aware, Redcycle passes all the recycling onto third parties – it appears we don’t have the infrastructure in Australia to manage that.”

According to Mathers, customers are used to dropping their soft plastics off at the red bins at their local supermarkets, and the pausing of this service risks undoing a lot of good work around building this habit. And while this is unfortunate, Mathers is hopeful that some good can come out of the situation and begin a conversation around ending the use of single-use plastic for good.

“Recycling for your average person is confusing. Businesses have to find their own solution, and when the cost to recycle is more expensive than the cost to landfill, how many businesses are actually recycling?” Mathers asked.

“We need to think of alternatives – ‘reduce’ is the best option in my mind. Convenience is what has driven the plastic-fantastic era, but it is mighty inconvenient for the planet.”

So, what’s the alternative?

Redcycle is now in discussion with state and federal governments, as well as industry leaders, to find a way to get its pipeline back online, but the situation shows how delicate Australia’s recycling system is and has prompted calls for retail to implement alternative packaging options.

“It’s a really scary situation,” Hero Packaging co-founder and chief executive Anaita Sakar told Inside Retail

“Redcycle completely changed the way consumers bought and disposed of their soft plastics, [and] while it was amazing to see this behavioural change, it also meant businesses were allowed to continue using single-use plastics. The result is millions of pieces of soft plastics going into the trash, which is a horrible outcome.”

Hero Packaging creates compostable mailing bags for businesses and customers to utilise, made from plant materials and a compostable bonding agent. The goal, Sakar explained, was to create a plastic alternative that could be put into a home’s compost bin, rather than adding to the already inefficient recycling chain.

According to Sakar, the best option for retailers moving forward is to switch to reusable or compostable options, and to educate their customers on how to dispose of them correctly.

“The waste generated in landfills could be reduced by at least 30% if packaging was properly recycled or composted,” Sakar said.

“[The Government] must find financially viable ways to convert plastics into long lasting products and eliminate the reliance on just one recycling operator like Close the Loop. Additionally, consumers need to educate themselves on what actually happens after packaging is disposed of, and need to be mindful as they purchase and demand to see changes from brands that they shop from.”

Moving forward, Mathers agreed that the best option is to move away from difficult-to-recycle materials and move to compostable and reusable options, and said that the business community needed to put more effort behind waste management initiatives. 

“I’d love to see more government-led initiatives around this that are realistically achievable in the next few years, not 30 years from now,” Mathers said. 

“I’d also like to see Coles and Woolworths use their power and reach to do something themselves rather than relying on Redcycle. Something that immediately sprang to my mind was, why can’t Woolworths or Coles build their own recycling plant?

“We need to think differently and we need to take responsibility for what we do, and if we have the ability to do both of the above, we need to start making changes.”

Environment minister Tanya Plibersek also called on the supermarkets to come up with a viable solution moving forward, rather than relying on others to do it.

“It shouldn’t be beyond these big supermarkets to come up with a viable solution to allow Australians to continue to recycle,” Plibersek said last week.

“I expect Coles and Woolworths to step up and indicate how they will deal with soft plastic recycling. We’re happy to work with them to achieve this. Their customers want to do the right thing, Coles and Woolworths should too.”


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