On a vanilla game, looping a recycler/chemical plant with the "explosive" recipe results in a net positive loop, even without productivity modules.
My guess is that the generated recycling recipe does not take into account that the Vanilla "explosive" recipe produces 2 items at a time.
Base game recipe:
- IN: 1 coal & 1 sulfur & 10 water
- OUT: 2 explosive
Generated recycler recipe (rf-explosives):
- IN: 1 explosive
- OUT: 1 coal &  1 sulfur & 10 water