"This is a sad day for the environment, our employees, our shareholders, and our other stakeholders, and it is a testament to the lack of leadership and necessary pace of change in the fashion industry," Michael Berg, chairman of Renewcell’s board of directors, said in a press release.
Last week, the fashion industry was stunned by unexpected news: Renewcell, a pioneering Swedish textile recycling company, declared bankruptcy. Having served as a pillar of sustainability in fashion for 12 years and supplying its 'Circulose' to renowned brands like H&M, Levi’s, Tommy Hilfiger, Calvin Klein, and Zara, the company found itself unable to secure the necessary financing and was forced to exit the market.
In this article, we will explore what lessons we can learn from the Renewcell case, why recycled textiles can’t be cheap, and uncover the reality behind the '100% recycled' labels.
First, we confront a simple yet challenging truth: sustainable fabrics cannot be cheap. There are three interrelated aspects of textiles - Price, Quality, and Sustainability - that, while they may overlap, can never fully converge. Fabrics can be affordable and of good quality (durable and long-lasting), but they often have a significant environmental impact. On the other hand, cheap and sustainable textiles tend to fall short in quality compared to their non-eco-friendly counterparts. The ideal, yet more costly, option is to pursue textiles that are both sustainable and of high quality.
Focusing on Renewcell, was their product sustainable? Absolutely. The company transformed cotton and viscose waste into a new pulp product named Circulose, encapsulated by the motto 'Old jeans turned into new jeans.' Given their 12-year track record, $10.6 million in venture funding, and big names among customers, the quality of their product can be defined as superior. But what about the price? Let's delve deeper.
While we won't speculate on the specific costs of Renewcell's fabrics, it's important to remember the trio of textile attributes mentioned earlier: such innovation cannot come cheaply. Yet, certain production choices by Renewcell, if reconsidered, might have helped their survival. Let’s review them in detail.
There are two primary recycling processes: mechanical and chemical. Mechanical recycling, the simpler and more cost-effective method with the lowest environmental impact, requires pure materials. Chemical recycling, though more complex and costly with higher emissions and energy use, can handle mixed materials, such as those containing elastane.
The reason many brands recycle offcuts (post-industrial waste) instead of old garments is that it can be done through mechanical recycling. In garments, on the contrary, the fabrics are rarely pure; they are often mixed with elastane or include coating, therefore leaving complicated and expensive chemical recycling as the only option. What could Renewcell have done to lower the cost of their product? Find a golden mean by increasing the percentage of post-industrial waste (textile offcuts) in their fibers.
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Location also plays a critical role. The choice to establish the recycling plant in Sweden, according to Renewcell, depended on the location of investors, brands, and availability of renewable energy. But let’s face the truth, most apparel brands manufacture their garments in Southeast Asia, and sometimes do not even know where the fiber for their clothes comes from. Relying on garment manufacturers or fabric trading companies saves brands a huge amount of time and money.
Renewcell's reliance on brands purchasing its Circulose, which then had to be shipped to Asia for further processing, highlights a significant challenge. The official reason cited for Renewcell’s bankruptcy - a lack of orders from brands - suggests that relocating operations to Southeast Asia could have simplified the process for brands, reduced costs, and facilitated access to the necessary post-industrial waste.
Professionals in countries like Taiwan and Vietnam, skilled in yarn spinning, fabric weaving, and garment production at fixed prices for brands, are arguably in the best position to assess and adopt new recycling technologies. Taiwan, for example, has developed a strong mechanical textile recycling infrastructure, showcased by FlyingTex's partnership with Saya in the TexCycle initiative.
We hope that the bankruptcy of Renewcell will not discourage efforts toward achieving closed-loop textile recycling. The urgency of climate change and the problem of landfill waste demand the continued development of sustainable practices. By blending materials, incorporating more post-consumer waste, and relocating production to the core of the Asian supply chain, companies can advance toward a sustainable circular textile economy.
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