Report: Recyclability and sustainability are long-term trends

August 31, 2018

 

 

An August 2018 study, “Rethinking Single-Use Plastics: Responding to a Sea Change in Consumer Behavior”, states that recycling and sustainability are recent market trends that are here to stay, and that the plastics industry must adapt to these developments.

 

The report was published by market researchers with Citi, who say there is a potential packaging “battleground” between plastic, paper, metal and glass materials.

 

 

Plastic Packaging Market

 

Today, packaging accounts for about 45% of the $1 trillion global plastics market – according to the study, only around 14% of plastic packaging gets recycled.

 

China’s National Sword policy led to a steep decline in market prices for recycled plastics, as China previously accounted for about one half of the global plastic recycling trade. To steady markets, Citi researchers say that standardized pricing mechanisms could help with plastic recycling and trading, and that waste-to-fuel technologies could lead to higher recycling rates by providing a larger market for scrap plastics. Researchers also claim that radio-frequency ID tags in plastic packaging could make sorting in materials recovery facilities (MRFs) easier, leading to greater recycling with lower contamination rates.

 

 

Biodegradable and Plant-Based Plastics

 

Researchers cite the “IHS Markit Chemical Economics Handbook: Biodegradable Polymers Report”, which says that biodegradable polymers demand will predictably grow at 9% per year over the next five years. Although the cost for biodegradable polymers is higher, their ability to reduce carbon footprints can lead to carbon credits, which will offset the raised costs.

 

In the global landscape today, there is more than one million tons of biodegradable plastics production capacity in place.

 

Plant-based raw materials may be another solution, especially when it comes to PET plastic bottles. The material is not only sustainable, but also competitive in quality with traditional plastic bottle materials when it comes to performance.

 

 

Packaging Sector Consolidation

 

The study also claims that consolidation in the packaging sector could help plastics become more competitive. Larger companies have greater resources for researching, developing and improving the manufacture and transportation of new packaging systems. But currently, plastic packaging production remains fragmented – especially compared with other packaging materials production.

 

The top four plastic packaging firms account for a little over one quarter of the market, most likely because plastic packaging has such a wide range of media and applications (including flexible films, rigid containers, pouches, caps, etc.).

 

The top 4 glass container firms, on the other hand, account for 95% of the market. Compared with plastic, glass and metal packaging have much narrower applications, making consolidation easier.

 

 

Changes in Market Shares: Current and Future

 

Plastic packaging faces a battle between cost and performance while also maintaining sustainability, and the study notes that “aluminum has the potential to regain share” in the single-serve soft drinks and other beverages markets.

 

Aluminum is easily recyclable, and cans are usually comprised of about 70% recycled content (compared to about 3% recycled content for PET and 23% for glass). Cans are also more likely to be recycled by consumers, with about a 50% recycling rate in the US (compared to alternative packaging systems at 30-40%). The production of recycled aluminum cans is also less energy-intensive.

 

Although glass is easily recyclable with no loss in quality or purity, it does pose some problems in the recycling stream. It is easily breakable, which disrupts streams. It is also a heavy material, and it currently has a low or negative value in recycling markets.

 

PET plastic holds about 50% of the US market for beverages, and has essentially replaced glass in the carbonated soft drinks market. But 73% of their caps and closures are made mainly with polypropylene (PP) plastic, which is not widely accepted into recycling streams. Metal currently comprises 24% of overall caps and closures production materials, but is susceptible to rise to replace PP caps.

 

Protective packaging is another area where plastics could soon lose market shares. Only 15% of US plastic film is currently recycled, and it is likely that some plastic bubble wrap and packing peanuts could be replaced with recycled paper packaging and crushed kraft paper.

 

Overall, manufacturers and packaging designers must keep in mind that, when it comes to packaging, sustainability is here to stay.

 

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