Can systems-level approaches, including collaboration along the value chain, make our approach to packaging more sustainable?

Sustainability is combined with other strong trends to drive significant changes in consumer packaging (particularly within the scope of regulatory and public concerns regarding disposable packaging waste). Regulators are on the move, and FMCG companies and retailers are proactively making bold commitments to improve the sustainability of their packaging and fundamentally rethink their packaging systems.

There will be a significant impact on packaging converters and their value chains, which could threaten the survival of many in the industry. However, for packaging converters with the proper focus and innovation capabilities, the new environment can offer significant growth and new partnership opportunities to support customers reviewing their packaging portfolios. Converters will have to embrace sustainability issues as consumer demands proactively, and regulatory requirements multiply.

Today, consumer awareness of packaging waste in oceans and landfills is driving change.

Packaging is ubiquitous in our daily lives and provides enhanced convenience features at low costs, minimizing food waste and overall product breakage. In the last decade; The global packaging industry has experienced strong growth, driven by changes in substrate selection and the expansion of new end markets. Significant changes include the increased use of plastic to replace other substrates and meet consumer demand for comfort, as well as the economic boom in China and other developing regions. However, the widespread use of disposable packaging containers has resulted in a heavy burden on the environment, and the management of packaging waste is facing a crisis due to two unresolved challenges:

Packaging Recyclability

Today, most of the packages cannot be recycled with the existing recycling systems. Especially it is valid for multi-material packaging, which presents a significant and unresolved challenge in recycling today.

Packaging Recycling And Leakage

Recycling rates of plastic packaging are relatively low. For example, in the United States, waste is generally managed with low leakage, but recovery rates for packaging and foodservice plastics are around 28 percent. In Europe, the reported plastic packaging recycling rate was slightly higher at 40 percent than 80 percent for cardboard and 75-80 percent for metal and glass (however, the overall quality of data collection on recycling rates was relatively high). Therefore, real-world rates may differ from reported figures. Developing regions (especially Asia) are under the most pressure, as growth in packaging demand is outpacing global growth rates and waste collection systems (let alone recycling) are not in place at the required scale. Global leakage or unmanaged dumps of all plastic material flows (both durable and non-durable) are estimated to be around 19 percent. Only 16 percent of all plastic waste is reprocessed to make new plastics. Most of the global plastic waste goes to incineration (25%) and landfills (40%), meaning that plastics are forever lost as a resource, despite their potential for reuse and recycling.

Governments Begin to Respond to Public Reaction

Governments have responded to public concerns about packaging waste, particularly single-use packaging waste, and have implemented regulations to minimize environmental waste and improve waste management processes.

In Asia, Thailand recently announced a nationwide ban on single-use plastic bags in department stores from 1 January 2020 and is aiming for a complete ban by 2021 to reduce plastic leakage into the environment. India shelved plans for a total ban. Single-use plastics for now but pushing for increased awareness campaigns and more collection points to improve collection and reduce waste. China has banned the import of plastic waste and banned/reduced single-use plastics, increasing recycling, recovery, and recycling of used plastics. Latin America had relatively low commitments to sustainability, with few regulations in place in the early 2000s. There has been a significant increase in awareness between 2016 and 2019. Several local and federal bills were passed or proposed in countries in the region. For example, Chile bans plastic bags for businesses, and Mexico City bans single-use plastics.

FMCG companies and retailers are moving fast to go far beyond traditional lightweight initiatives

Historically, the actions of FMCG companies and retailers have mainly focused on quick gains such as reducing weight and materials used to enable them to cut packaging costs. But in the last few years, packaged product manufacturers and retailers have begun to commit to taking action on packaging waste. Nearly all of the top 100 FMCG companies (in terms of revenue) have made bold statements and commitments to ensure sustainability in the years to come.

At the same time, sustainability-focused initiatives around the need for innovation and change in packaging are combined with other key industry trends affecting the packaging industry like cost pressure, e-commerce, digitalization (in general), and changing consumer preferences. As a result, FMCG manufacturers and retailers are beginning to experiment with complete packaging redesigns and fundamental rethinking of distribution chains (including circular delivery models). They also want to curb the production of plastic waste by experimenting with the use of metal and glass in recycled systems. Big brands are starting to self-regulate.

In a recent example, a US company has launched laundry detergent in new packaging specifically for online orders. The detergent is reformulated to be more concentrated, and its packaging has been designed to be lighter in transit than the original version, reducing its overall weight. Handling is improved with a plastic sleeve that fits snugly inside a rectangular cardboard pack. In addition, this hybrid substrate mix provides an added sustainability benefit by using 60 percent less plastic than before. Still, we must not forget that composites can be more challenging to recycle. In another example, a consortium of leading brands, a logistics provider, and a recycler recently got together to test the concept of returnable and reusable packaging, essentially reinvigorating the idea of a "dairy maker." The pilot was implemented in the Paris and New York regions in 2019; however, the jury is still undecided on how much potential exists to justify future scale-up. Meanwhile, some brands have expressed their readiness to consider packaging innovations that include increased fiber-based packaging over traditional polymer packaging.

Public awareness of the leakage of packaging waste, especially plastic waste, into the environment has increased significantly over the past 12-24 months, reaching an all-time high. Intuitive images of the effects of plastic pollution in the oceans have stirred consumer awareness around the world.

From now on, FMCG companies and retailers will have to become more aggressive in addressing sustainable packaging in response to increased consumer awareness and increased regulatory requirements. However, we should note that limiting the use of plastic packaging and changing packaging materials comes at a cost in terms of additional complexity and trade-offs, many of which will not be trivial:

• FMCG and retailers will have to face complex trade-offs such as recyclability versus carbon footprint and food waste.

• Not all actions have the same impact on different aspects of the sustainability footprint.

• Technical and economic feasibility varies by type and application of plastic and geographic region, and the cost implications go beyond just packaging material prices and conversion costs.

• Any packaging material or design change has implications for the overall brand strategy, and the broad portfolios of different plastics, applications, and geographies make the process very complex.

New challenges in waste management and recyclability are taking FMCG companies and retailers into new and unknown territory. In the past, these organizations have pursued a relatively narrow packaging sustainability agenda focused mainly on light-weighting. Successful addressing of new recyclability and waste issues will likely expand the capabilities of existing tools and strategies.

As a result, FMCG companies and retailers will need to collaborate much more closely with upstream players, packaging converters, and recyclers to successfully meet these new challenges. One of the critical areas is the need to build infrastructure to manage increased recycling using more closed systems (i.e., bottle-to-bottle recycling to avoid recycling). Another area is to coordinate changes with film converters and to recycle infrastructure to build recycling capacity. In summary, accepting polyolefin multi-substrate films can recycle much larger quantities of flexible packaging and another multi-material packaging.