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This article was first published in The State of Fashion in 2022, an in-depth report on the global fashion industry jointly published by BoF and McKinsey & Company. To learn more and download a copy of the report, click here.

Globally, the fashion industry generates approximately 40 million tons of textile waste every year, most of which are either sent to landfills or incinerated. At the same time, textile production consumes a lot of water, land and raw materials. Participation in closed-loop recycling is seen as an important opportunity to reduce the extraction and production of original raw materials and limit textile waste. The closed-loop system recycles materials again and again, keeping them theoretically in constant circulation.

Compared with many other sectors, textile production consumes more resources. For example, in the European Union, the textile industry is the fourth largest consumer of primary raw materials and water (after food, housing, and transportation), and the industry’s reliance on polyester and other fossil fuel textiles will only increase the challenge. However, a part of the global fashion industry is beginning to take these challenges seriously, by working to develop closed-loop recycling processes that have the potential to limit textile waste, reduce carbon footprint, and to a certain extent subvert the fashion mining business model.

At present, less than 10% of the global textile market is made up of recycled materials. This is mainly products that use PET (polyethylene terephthalate) bottle waste for open-loop recycling. It does not solve the problem of recycling materials from the fashion industry. Demand has also been criticized for breaking the mature closed-loop process of recycling plastic bottles into other plastic bottles. If the industry wants to reduce the number of landfills and limit the extraction and production of textiles, a large-scale closed-loop recycling system is needed.

The shift to more closed-loop systems is underway, partly because of regulatory efforts to support a circular economy, which aims to alleviate some of the pain points associated with waste collection and sorting. The EU’s Circular Economy Action Plan is passed in the third quarter of 2021 and contains objectives to ensure that the principles of the circular economy are applied to textile manufacturing, products, consumption and waste management. At the same time, the EU’s waste directive framework requires countries to separate all textile waste by 2025, and some European countries have implemented extended producer responsibility plans to make brands and retailers responsible for post-consumer waste and require manufacturers to provide financial contributions. Used for collection, recycling and recycling. Product reuse.

"Regulators should continue to put this pressure on the market," said Patrik Lundstrom, chief executive of Renewcell, a Swedish textile recycling company. "Every country needs to take responsibility and create this cycle."

China issued a five-year plan in July 2021 to develop a circular economy by promoting recycling, remanufacturing and renewable resources. In the United States, the National Institute of Standards and Technology is making progress in its ambition to promote a textile circular economy. Nonetheless, if the industry is to align with global climate goals and its commitment to sustainable materials, it also needs to take action at the brand level to make a difference.

One challenge facing the industry is to achieve sufficient scale in the closed-loop process. However, recent innovations have begun to mature, moving from pilots to industrial-level proofs of concept.

Mechanical cotton recycling has been used for a long time by crushing cotton into reusable fibers. An example of mechanical recycling is the large-scale pilot of the Circular Fashion Partnership led by the Global Fashion Agenda in Bangladesh, whose purpose is to capture post-production waste and channel it back into the production of new textiles and develop solutions for slow-moving goods. The partnership plan is extended to countries including Vietnam and Indonesia.

Historically, mechanical cotton recycling has been more difficult to implement for worn garments, mainly due to the challenges of collection and sorting. Therefore, by 2020, less than 1% of cotton will be recycled. However, in a recent initiative, Hong Kong-based spinner Novtex Textiles and the Hong Kong Textile and Apparel Research Institute (HKRITA) have developed a method called the Billie System for the recycling of cotton blending machinery. The system does not consume water or produce chemical waste, and can currently process up to three tons of fabric per day.

In order to realize the recycling of various textile fibers on the market, in addition to shredding, more innovative recycling solutions are needed. For non-mixed materials, many industrial-scale solutions have begun to be put on the market, and more capacity will be available. For example, Renewcell works with brands such as H&M and Levi's, and has reached an agreement with Beyond Retro’s parent company, Bank & Vogue, which provides Renewcell with post-consumer waste. Renewcell is building a new factory that will recycle 60,000 tons of textiles per year by 2022. At the same time, American materials company Eastman is studying the use of polyester in its new $250 million recycling plant.

One of the technical challenges facing the industry is the high proportion of garments made of blended materials such as cotton and polyester, which makes them difficult to separate. Nevertheless, after years of research and development and pilot projects, this is another field that is moving towards maturity and scale. In Europe, viscose fiber manufacturer Lenzing and recycling company Sodra are collaborating to increase the annual production capacity of Sodra hybrid fiber technology, with the goal of processing 25,000 tons of textile waste per year by 2025. In Turkey, denim company Isko has signed a license agreement for the "green machine" technology developed by HKRITA, which can recycle cotton and polyester blends. The technology is also being expanded with partners in Indonesia. In Australia, BlockTexx is building a polyester-cotton blended fabric recycling facility with a goal of recycling 10,000 tons per year by the end of 2022.

A key part of the old clothes recycling puzzle is collection and sorting. "If we can collect and sort on a larger scale, it will be of great help to us," said Ronna Chao, chairman of Novtexx. "The space where my Billie System is located is limited, so I cannot be a collector, storer and sorter at the same time... [But] if we can cooperate with, for example, NGOs or other players in the industry[ In other countries], where they can collect and sort...then we can process it in a more meaningful way."

To this end, the authorities, waste companies and brands are working hard to develop solutions. These offer some hope, but further efforts are needed, including from manual sorting to large-scale automatic sorting. For example, in Sweden, the Sysav Waste Treatment and Recycling Company opened the world's first industrial-scale fully automated textile sorting plant in 2020, which can sort 24,000 tons of textile waste each year. In the same year, Belgium-based Valvan Baling Systems launched Fibersort, an automatic sorter that can sort approximately 900 kilograms of post-consumer textiles per hour.

Some companies have also pioneered digital solutions for managing logistics. Sorting for Circularity, created by Fashion for Good in 2021, plans to launch a digital platform on which the textile waste generated by the sorter can be matched with recyclers. Brands such as Adidas, Bestseller and Zalando are promoting the project. In addition, many brands are helping to resolve classification issues by encoding detailed information about materials into products with digital identifiers (see "Product Passport").

Although these measures show that the industry is making progress, there are still some issues to be resolved. A major challenge is that recycling facilities are sometimes far away from the source of raw materials, which can result in large amounts of emissions from long-distance transportation.

"We took the clothes from [Asia] and brought them all back to Sweden to make new Circulose [materials], peel them off, and make new viscose fibers. However, our next factory will be close to the port [and ], of course, in the long run, we may want to have a factory in Asia, and perhaps also in the Americas," said Lundstrom of Renewcell. "To achieve all this requires capital expenditure investment. How do we reduce and manage it as much as possible? So this is another trade-off in the cycle."

Experts mostly agree that unless the product is specifically designed for this purpose, such as by designing to promote easier material separation, closed-loop recycling will not realize its potential. Claire Bergkamp, ​​chief operating officer of Textile Exchange, a non-profit organization that aims to improve the environmental standards of raw material production, said that this also means incorporating the intent of recycling into the design curriculum and industry-wide organizational thinking: when the first user completes the product? Is it durable? Will it have a long enough lifespan? This is the crux. If you deliberately make something that is not durable, it needs to be recyclable," she said.

For this reason, certain parts of the industry are uniting around common design standards, such as the jeans redesign project of the Ellen MacArthur Foundation. By May 2021, 80% of the participants in the project have produced fabrics or jeans that meet the criteria. In addition, designers can use more software that supports recycling design, such as the Circular Material Library from Circular Fashion, which showcases tested and verified materials that can be used for future recyclability. In addition, innovations such as the soluble thread Ecocycle recently launched by the industrial thread company Coats are improving the efficiency of the recycling process, unlocking the removal of non-textile components, and facilitating easier sorting of materials from the same piece of clothing.

“We know that it will be more challenging for some fashion brands—for example, maybe small and medium-sized enterprises—to invest in closed-loop solutions in the early stages of technological development,” said Shaway Yeh, founder of Shanghai Fashion Innovation and Sustainable Development. Agency Yehyehyeh. "But designers now really need to make a meaningful effort to embed this principle in their studios, if they don’t already. Creative teams in companies should be motivated by the leadership to use some of their natural creativity. Expanding the use of recycled materials. This is just a priority."

As more and more fashion players are committed to using recycled materials, scale is essential for collection, sorting and recycling. However, the introduction of industrial processes will drive down prices and increase demand for clothing made from recycled materials. In order to maintain a competitive advantage and ensure access to recycled textiles, fashion companies may need to invest directly in recycling facilities and contribute to the search for collection and sorting solutions. Of course, scaling up will require capital expenditures, which means that decision makers will need to ignore the still relatively cheap cost of raw materials.

[Closed loop] Not a panacea... The panacea produces less.

To be sure, the closed-loop recycling process also brings environmental challenges, including greenhouse gas emissions and large amounts of water use. Some critics believe that the reduction in the impact of the closed-loop process is not enough to alleviate the negative impact of fashion on climate change. "[Closed-loop] is not a panacea... …The panacea produces fewer things," said Bergkamp of the Textile Exchange.

However, in the context of comparison with open-loop (or indeed linear) models, the closed-loop process is an important part of the broader circulatory system change. "The impact of recycling is always less than linear. There is no doubt about it," Bergkamp said. "For imperfect situations, this may be a perfect solution."

Although there are reasons to be optimistic that many closed-loop technologies will reach industrial scale in 2022, fashion leaders need to tackle the challenge as a whole and incorporate circular textile solutions into broader efforts to eliminate toxic chemicals and enable the supply chain Decarbonization and reduction of emissions, if the industry is to significantly reduce its degree of harm to the environment.

The sixth annual state of fashion report predicts that global fashion sales will exceed pre-pandemic levels in 2022 due to categories, value segments, and regions that perform better than pandemics, and supply chain headwinds will pose risks to growth prospects . Download the report to learn about the 10 themes that will define the state of the fashion industry in 2022 and the strategies deployed to ensure recovery and sustain sustainable growth. BoF professionals are invited to join our special live event on December 8, 2021, where we will unlock the findings in the report. Register now to reserve your place. If you are not a member, you can use our 30-day trial period to experience all the benefits of a BoF Professionals membership.

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