Xycle secures millions in funding amid plastic recycling crunch
The company secures tens of millions in funding despite industry headwinds that led to multiple bankruptcies.
Published on March 10, 2025
© Xycle
Mauro swapped Sardinia for Eindhoven and has been an IO+ editor for 3 years. As a GREEN+ expert, he covers the energy transition with data-driven stories.
Xycle, a plastic recycling startup, announced securing funding to build its first commercial plant in the port of Rotterdam. The funding amount, provided by a consortium that includes Dow Chemical, Vopak, ING and Polestar Capital, and Invest-NL, has not been disclosed. According to the FD, the investment should be between €75 and €100 million–a blend of equity and debt.
The Dutch plastic recycling sector is experiencing tough times amid high energy costs and competition from cheaper plastics from China. In the past months, 11 companies filed for bankruptcy, emphasizing the industry's struggles. Last week, the industry called on the government for help.
What sets Xycle apart
Xycle, originally from India, has been active in the Netherlands for years, working on low-temperature pyrolysis. In other words, the company breaks down plastics into molecules using low-temperature heat, producing an oil that can be used as a feedstock for the production of new plastics.
“What appealed to investors is the fact that the technical risks are limited. The plant will use existing pre-treatment and plastic recycling technology,” Arie van Vliet, business developer at Xycle, told IO+. He also emphasized how the funding came after a five-year long journey of talks with potential investors.
This technology is an example of plastics chemical recycling. Mechanical recycling–the shredding of material–only applies to a limited number of plastic types. Chemical methods like Xycle’s can help process more, including food-grade packaging and medical and automotive components. At the time being, according to the Organisation for Economic Co-operation and Development (OECD), 9% of the world's plastic is recycled. The bulk of it ends up in landfills, or in the environment. The equivalent of two garbage trucks worth of plastics enter the ocean every minute.
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The plant
Xycle's first commercial-scale plant will be able to process 21,000 metric tons of plastic waste each year. Situated in the Port of Rotterdam, this chemical recycling facility benefits from strategic access to plastic waste transportation and the distribution of pyrolysis oil to off-take partners. Rotterdam's existing petrochemical infrastructure, proximity to potential partners and suppliers, and access to other European markets further enhance its appeal as a location.
The facility is anticipated to be fully operational by the fourth quarter of 2026. Xycle’s modular design enables production to be scaled up or down based on demand, ensuring both operational flexibility and efficiency. Looking ahead, Xycle aims to establish additional chemical recycling facilities worldwide, employing larger reactors to boost the capacity of individual plants to 100,000 metric tons annually.
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Dutch plastic recycling industry struggles
Unico van Kooten, European Affairs advocate for Vereniging Afvalbedrijven (the waste management association), called for €100 million a year to keep the industry afloat. The House of Representatives adopted a motion by Volt politician Marieke Koekkoek calling for emergency funding for plastic recycling companies.
The higher costs–energy and salaries–impact the Dutch plastic industry’s capacity to compete against Asian and Eastern European counterparts. Dutch companies saw demand for their products plummet, with processing capacity falling accordingly. Six companies went bankrupt last November, and the waste management association foresees new insolvency this year.
The problem is broader and concerns Europe as a whole. European umbrella organization of recycling companies EuRIC advocates for introducing minimum recycled content–Xycle’s Van Vliet also agrees. To be fully effective, the law should require plastic recyclate to come from Europe. The law will be introduced in the Netherlands in 2027 and Europe in 2030. Yet, this might be too late, with companies that might not make it through this bridge period.
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