Global Environmental & Recycling Industry Report

The recycling services market grew at a compound annual growth rate (CAGR) of 6.3% to rise from a value of $58.53 billion in 2023 to $62.22 billion in 2024. This notable growth can be associated with increasing awareness of environmental sustainability, stricter waste disposal regulations, more emphasis on resource conservation, and regulatory pressures regarding the use of landfills.

The market is expected to continue to grow steadily over the next few years at a CAGR of 6% to reach $78.43 billion by the year 2028. Much of this expansion is expected to be driven by increased use of circular economy practices, government initiatives regarding waste reduction and recycling, growing demand for recycled materials, expanding e-waste recycling services, and sprawling urbanization.

Market Segmentation

The recycling market is segmented by:

• Waste Type: Compost & Food Waste, Glass & Fiberglass, Metal Scraps, Plastic, Waste Paper, Paperboard, and other
• Service: Collection Service, Disposable Service
• Application: Municipal, Agricultural, Construction, Industrial, and other

Key Market Trends & Drivers

Several areas will remain key factors in the environmental and recycling sector in 2025, including:

• New wastewater treatment methods
• Advanced plastic & polymer recycling technology
• Sustainable food and agricultural waste recycling techniques
• The zero waste movement which aims to avoid sending trash to landfills, incinerators, oceans, or any other part of the environment
• Resource recovery using waste to create new product outputs, delaying the need to use raw materials in manufacturing processes
• Artificial Intelligence (Al) in recycling, such as the integration of robotics and automation in recycling facilities and the implementation of intelligent waste management systems
• New recycling methods, such as iron-catalyzed, solar-powered recycling that efficiently breaks down polystyrene and methods that turn plastic waste into geosynthetics
• Transitioning to a circular economy to close the loop between extraction, manufacturing, and disposal. This includes product design that reduces waste, products, and materials that can be used for as long as possible, and the recycling of materials from end‐of‐life back into the economy
• Sustainable practices, including carbon capture technology, regenerative agriculture, the reduction of toxic waste, and renewable energy projects
• Bio-medical waste practices that improve safety and reduce waste
• Waste oil recycling which offers many strategic growth opportunities for businesses in a competitive landscape
• Growing awareness surrounding plastic pollution, which is the buildup of synthetic plastic particles in the environment, poses a threat to human health, animals, and their habitats, and it is also thought to contribute to climate change. Many governments are enacting new policies that will reduce the use of plastic and raise awareness of this type of pollution
• Plasma-arc recycling, which uses a hot plasma torch to recover most metal in vehicles and objects
• Smart sensors that employ ultrasonic beams to assess bin fill levels. These types of sensors can detect garbage material in various bins and containers
• Data and data collection advancements such as:

–   Voluntary and mandatory implementation of Digital Waste Tracking systems

–   New sampling and reporting requirements under Extended Producer Responsibility (EPR)

–   Monitoring and reporting requirements emerging for energy recovery

• More focus is on e-waste, which contains hazardous materials that need special attention for disposal and recycling. As the volume of e-waste grows, the market will need to advance to accommodate waste-recycling services globally

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M&A

2024 has shown significant M&A activity, which is expected to continue. This activity is being propelled by many different factors, including:

–   Increasing regulatory pressures and demand from consumers for sustainable service offerings are pushing companies to turn to M&A and investments in technologies and processes that reduce environmental impacts

–   Geographic expansion and consolidation

–   The strategic supplementation of new capabilities that break into new markets and stimulate growth

–   Larger companies are increasingly acquiring smaller operations to expand their service offerings and boost efficiencies

Buyers have become more focused on acquiring businesses that offer advanced technologies with regard to waste sorting, recycling, and waste-to-energy conversion. These newer technologies have become a necessity for improving recycling rates and creating novel solutions to deal with complex waste flows. The most sought-after M&A targets are firms offering proprietary technologies or compelling research and development (R&D) capabilities.

The sector's defensive nature makes it attractive for private equity and infrastructure firms. The more fragmented environmental services segment has ongoing consolidation and growth opportunities.

Investments in technology for capturing and reducing greenhouse gas emissions are growing due to the increased focus on landfill methane. Organics recycling infrastructure is also seeing incremental growth. Some of these projects are receiving historic grant funding from the EPA that will continue to emerge.

The global municipal solid waste (MSW) volume is anticipated to grow to 3.4 billion tons by 2050. Participants in this sector expect to pursue acquisitions to scale operations to accommodate this increased waste volume.

Strategic M&A is expected to thrive along with the global need for consolidation, geographic expansion, diversification of services, and sustainability. Public strategies with favorable debt terms and emerging companies that offer new technologies are arming the industry with substantial consolidation opportunities through 2025.

Our Recent Success Stories in the Sector

Some of Benchmark International’s more recent successful deals in the environmental & recycling space include:

• The sale of Curie Environmental Services, LLC to Tradebe Environmental Services, LLC
• The acquisition of Biomatrix Water Solutions Limited by Ross-Shire Engineering Limited
• The transaction between R.E.S. Distribution Limited and Wolseley UK Limited
• The sale of IPM Environmental Services Limited to Tyro Group
• The acquisition of NLG Ecology Limited by Phenna Group
• The deal between Anchor Pumps Company Limited and Megagroup Trade Holding BV
• The sale of Cornelsen Umwelt Technologies GMBH to Rivus Capital
• The transaction between Aurora Health Physics Services Limited and the RSK Group Limited
• The acquisition of Herrington Consulting LTG by Environmental Protection Strategies LTD
• The deal between Trident Water Solutions Limited and Phenna Group
• The sale of PDS (NW) Limited to The Thermatic Group
• The acquisition of Andidrain Limited by Denholm Energy Services Limited
• The sale of ARC Abatement to West Fork IP, LLC
• The deal between Ecology Solutions Limited and Phenna Group
• The sale of Intracoastal Environmental, LLC to Ambipar Response Group
• The acquisition of Biochemica UK LTD by Veolia Water Technologies UK

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