Demand prompts SER to double PP recycling capacity in Indiana

National Harbor, Md. — A recently opened polypropylene recycling facility in Anderson, Ind., is already talking about expanding, thanks to strong output demand.

SER North America is ramping up production on two new processing lines with a combined annual capacity of 35 million pounds, CEO Lorenzo Ferro said during a March 8 interview at the Plastics Recycling Conference in National Harbor.

The company, a unit of Cittadella, Italy-based Sirmax Group, used the conference as a coming-out party for the new $30 million facility and talked openly about the project for the first time.

SER North America actually broke ground for the 124,000-square-foot recycling plant in 2019 but saw the project delayed due to COVID-19. The building was finished by the end of 2020 and the company used 2021 to install equipment and start production, Ferro said.

"We did the ramp-up last year. We're now at the finishing stage of that ramp-up. We're close to that 35 million annualized," he said. "That line is literally sold out already. The demand for recycling is very high."

SER North America is selling about half of its production into the market and using about half at an adjacent Sirmax polypropylene compounding facility in Anderson.

"If we wanted to, we could sell all the recycled PP into the market to all the converters who are using recycled PP," Ferro said, due to high demand.

Sirmax, however, wants to dedicate some of the recycled PP for its own compounding operations to help its customers, mostly automotive and appliance makers, meet their recycled-content goals. Sirmax likes the idea of controlling the production of its own recycled PP to ensure quality.

Having a dual approach also gives the company a hedge if demand from either half of the recycled plastic business slows down in the future, the CEO explained.

"The main reason for going into the recycling business was to support the trends we were seeing in compounds where automotive and appliances were moving toward introducing recycled content," Ferro said.

With strong demand already for the company's first two recycling lines in the United States, plans are to add two additional lines starting next year to double capacity to 70 million pounds, Ferro said. "Those are already in our business plan to further expand capacity."

And, from there, the company has room for construction of even more building space in the future to facilitate additional growth over time, said the CEO, who is in charge of all North American operations for Sirmax.

SER North America uses post-industrial PP but eventually sees a time when the company will introduce post-consumer material. Post-industrial plastic is typically a cleaner recycling stream compared with post-consumer, so the operation currently does not have a wash line. Adding post-consumer material would create that need, Ferro said.

Creation of the SER North America facility follows an expansion of adjacent Sirmax compounding operations last year. Sirmax invested $11.2 million on six new extrusion lines for sites in Anderson; Kutno, Poland; and Cittadella and San Vito al Tagliamento, Italy, that increased compounding capacity by nearly 60 million pounds annually.

SER North America borrows its name from Sirmax's acquisition of plastics recycler Società Europea di Rigenerazione, or SER, of Salsomaggiore Terme, Italy, in 2019. The company used the technology acquired through that purchase as a basis for the new SER North America operations.

SER North America expects the new recycling facility will create 40 jobs by the end of this year, bringing total employment between the two sites to 140. Sirmax's operations in the United States generate about $80 million in annual sales, the company said.