The Future of EPS in the Italian Construction and Packaging Sectors
After a challenging 2024, the Italian expanded polystyrene (EPS) sector is looking ahead with renewed optimism. Despite economic uncertainties, Italy remains one of Europe’s key EPS markets, with a strong presence in both construction and packaging. Alessandro Augello, President of the AIPE, the Italian Expanded Polystyrene Association, and Converters Director of EUMEPS, shares insights into the market’s current dynamics, growth potential, and the challenges it faces in reinforcing EPS’s role as a fully recyclable and sustainable material.
At EUMEPS, we are pleased to share this article originally published in Plastix Magazine, highlighting the resilience and innovation driving the Italian EPS industry forward
EPS prepares for growth
After a subdued 2024, the expanded polystyrene (EPS) market looks ahead to the next 12 months with growth objectives for both the construction and packaging sectors.
By Carolina Parma
"We have many ongoing projects supported by results demonstrating the sustainability of our material thanks to its full recyclability. Our real challenge is to promote a culture of sustainability, backed by operational evidence, so that we can effectively counter the emotional wave of the plastic-free movement."
— Alessandro Augello, President of AIPE
Within the complex plastics market, the expanded polystyrene (EPS) sector has shown resilience in the face of geopolitical tensions, inflation, and market fluctuations. Forecasts indicate only a slight decline in production, which by the end of 2024 is expected to settle at 140,000–145,000 tonnes, compared to 155,000 tonnes in 2023. Of this, approximately 100,000 tonnes will be absorbed by the construction sector, the leading market with a 66% share, significantly ahead of the packaging sector, which ranks second with a 32% share, amounting to 49,000 tonnes of EPS.
"The gradual decline in demand has primarily been driven by the depletion of the 'super bonus' effect, which led to a reduction in material demand for building renovations," explains Alessandro Augello, President of AIPE (the Italian Expanded Polystyrene Association), which represents the industry’s leading companies. Despite ranking second, the packaging sector has proven to be more resilient, with demand fluctuations for EPS being less pronounced. "This is because EPS has a wide range of applications in this sector, which helps balance demand variations, and some of these applications have even delivered unexpected results," Augello continues. "On one hand, there has been stability in the pharmaceutical industry, which maintained a steady demand for packaging, as well as in the cold chain. On the other hand, a surprise has been the continuous growth in EPS packaging for new-generation boilers and heat pumps. These have now become a standard for Class A and B buildings, as they are more energy-efficient and environmentally friendly compared to older heating and cooling systems."
This trend is expected to continue throughout the next decade. According to recent projections, the global heat pump market is set to reach $46 billion by 2030, growing at an annual rate of 12.2%. "Further confirming that construction remains the leading sector, we must also highlight the strong performance of EPS insulating panels used in underfloor heating and cooling systems."
Outlook for 2025
These figures offer promising prospects for 2025. "We believe there will be a slight recovery in the construction market as a whole," says Augello. "Lower interest rates should help restart the new housing market by unlocking some projects that were put on hold in 2024. This factor should drive demand for our products, as new construction requires significantly more insulation panels compared to the renovation market."
Additionally, the industry's investments in innovation and sustainability are expected to support the recovery. "Recycled expanded polystyrene volumes have been increasing for several years. From 2019 to 2022 alone, they grew by 25%, surpassing 20,000 tonnes. In 2024, we estimate a further increase of around 9–10%."
Sustainability and the circular economy are essential pathways for continued growth. "For this reason, in recent years, AIPE has worked tirelessly towards the sector’s sustainable development, supporting institutions in defining regulations for construction, packaging, and the circular economy, actively engaging in EPS recovery and recycling, promoting technological innovation, and supporting professional development," states Augello. "For the future, we intend to uphold our commitment, fully aware of the complex challenges ahead: strengthening existing alliances, raising awareness, and enhancing knowledge—based on scientific evidence—of the benefits of expanded polystyrene. EPS is a unique, irreplaceable material in many applications, 100% recyclable and sustainable. We aim to increase attention to collection and proper disposal. We look to the future with confidence, convinced that raising awareness among all stakeholders, fostering strong collaborations, and driving innovation will allow us to achieve tangible goals for a more resilient sector that is attentive to environmental and social needs."
Never losing sight of research and development, as well as new technologies, remains key to continuously improving the material’s application across various sectors.
Challenges Ahead
Despite these positive growth prospects, challenges remain. Chief among them is the recognition of EPS as a 100% recyclable material, "particularly in the packaging sector," Augello emphasises. "We have many ongoing projects backed by results that prove our material’s sustainability due to its full recyclability. Our real challenge is to promote a culture of sustainability, supported by operational evidence, so that we can effectively counter the emotional wave of the plastic-free movement. We are convinced that only data can make a difference. In short, we believe we can reposition ourselves in the market with a new narrative to compete directly with other materials that share our areas of application. This also applies to the construction sector. From an innovation perspective, we strive to support our members, who are working to expand and strengthen their market presence through their products." AIPE aims to achieve these goals through collaborations with external research centres and industry associations.
"We are currently working with Legambiente on EPS dissolution-based recycling in partnership with several universities," Augello explains. "We are also closely collaborating with Corepla to develop projects that make material sorting in the final collection phase more effective and efficient, increasing the amount of recycled EPS reintroduced into the market," he concludes.
Italy’s EPS Market: A Path Towards Sustainability and Innovation
The Italian EPS industry has proven its ability to adapt to market shifts, maintaining its position as a crucial material for both insulation and protective packaging. While the gradual decline in construction incentives has impacted demand, the sector is actively investing in circular economy initiatives to reinforce EPS’s sustainability credentials. The growth in EPS applications for heat pumps, underfloor heating, and pharmaceutical packaging demonstrates the material’s versatility and continued relevance.
Looking ahead, Italy’s EPS industry is set to benefit from increasing investments in recycling technologies, regulatory engagement, and industry-wide collaboration. AIPE’s efforts to strengthen EPS collection and reprocessing capabilities will be instrumental in positioning EPS as a key material in Italy’s transition towards a more circular and resource-efficient economy.
With 2025 expected to bring new opportunities, particularly in the housing market and innovation-driven packaging solutions, EPS continues to be a smart, sustainable choice for Italian businesses. For more insights into how EPS is shaping Italy’s sustainable future, visit EUMEPS.