Victoria's plastic recycling capacity gets a $4 million boost
Victoria's hard-to-recycle plastics, including soft plastics, will be diverted from landfill and transformed into new products, thanks to a $4 million government and industry investment. This investment will fund four new projects that will increase plastics recycling by 16,700 tonnes annually, boosting jobs in the Victorian circular economy.
The four projects receiving funding are:
- Pact Recycling (Cheltenham) – The bagMUSTER project will recover and recycle bags used to transport seed, fertiliser, pesticides and stockfeed.
- APR (Dandenong) – The soft plastic sorting capacity upgrade will use an infrared process from Norway to improve sorting and recycling capability, including for end-of-life soft plastics.
- Australian Soft Plastics Recycling (Pakenham) – The upgrade to facilities will improve the recycling of low-density polyethylene films, such as pallet wrap collected from supermarket warehouses, by increasing processing capacity and improving the quality of the recycled material.
- RE4ORM (Barnawartha) – The facility upgrade will recover low-density plastics for reuse in manufacturing new recycled products.
The $3.5 million government investment includes $1.75 million each from the Victorian Government and the Federal Government through the Recycling Modernisation Fund (RMF).
The RMF is supporting states and territories in a one-off boost to Australia’s capacity to sort, process and remanufacture waste glass, plastic, tyres, paper and cardboard.
Federal Minister for the Environment and Water Murray Watt said the new infrastructure in Victoria marks an important step in transforming how Australia manages plastic waste.
"Plastics remain a complex waste challenge. By building recycling capability here in Victoria, we’re making real progress in recovering materials that would otherwise go to landfill."
"These projects are a strong example of the Recycling Modernisation Fund in action – helping to keep plastic out of landfill and in productive use."
The Federal Government is investing more than $200 million in new and upgraded recycling infrastructure through the RMF, contributing towards $1 billion of investment with states, territories and industry.
Including these four projects, the RMF is supporting 27 projects in Victoria with $79 million in joint funding, including $44.7 million from the Federal Government and $34.3 million from the Victorian Government.
The projects are expected to add 328,000 tonnes of recycling capacity each year and see $226.5 million invested in recycling infrastructure in the state.
Victorian Minister for Environment Steve Dimopoulos said the projects will strengthen Victoria’s capacity to manage plastic waste, ensuring more materials are recovered, reused, and kept in productive circulation.
From 19 January 2026, Round 6 of the Recycling Modernisation Fund will make a further $4 million in joint funding available to businesses, social enterprises, not-for-profit organisations and local government organisations to further build the capacity and divert waste from landfill into the circular economy.
Applications close 1 July 2026 or once funding is fully allocated.
For more information, visit: https://www.dcceew.gov.au/environment/protection/waste/how-we-manage-waste/recycling-modernisation-fund
Related stories:
- Urgent government action needed to protect Australia’s plastic packaging recycling future (https://wastemanagementreview.com.au/urgent-government-action-needed-to-protect-australias-plastic-packaging-recycling-future/)
- APR Plastics to open soft plastics recycling facility in Victoria (https://wastemanagementreview.com.au/apr-plastics-to-open-soft-plastics-recycling-facility-in-victoria/)
