SUSTAINABLE PACKAGING MARKET ANALYSIS

The global sustainable packaging market size was valued at USD 227.32 Bn in 2021 and is anticipated to witness a compound annual growth rate (CAGR) of 7.5% from 2022 to 2030. Growing government initiatives to promote sustainable packaging due to increasing plastic wastage on landfill is primarily fueling growth of the sustainable packaging market. According to a report published by the UN environment program, more than 8.3 billion tons of plastic have been produced since the early 1950s. About 60% of that plastic has ended up in either a landfill or the natural environment. Moreover, around 8 Bn tons of plastic end up in the world's oceans every year.

Global Sustainable Packaging Market: Regional Insights

North America is expected to gain significant growth over the forecast period owing to the favorable government policies which is driving demand for sustainable and biodegradable packaging. Moreover, key players are adopting compostable packaging solution. For instance, No Evil Foods’ vegetarian meat alternatives have produced compostable packaging made by Kraftpak and printed with plant-based ink. Previously, No Evil Foods used butcher paper with non-biodegradable stickers, making it challenging to compost the butcher paper.

Europe is also expected to witness the fastest growth over the forecast period due to growing government initiatives to reduce the waste on landfill. For instance, the government has proposed that from 2023, all local authorities in England should offer weekly separate food waste collections for households. Over 600 brands use the UK-wide On-Pack Recycling Label (OPRL) scheme for recycling.

Figure 1. Global Sustainable Packaging Market Value Share (%), By Region, 2021

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Global Sustainable Packaging Market Drivers:

Growing initiatives by government to reduce the plastic waste on landfill is primarily fueling the growth of sustainable packaging market. For instance, in 2021, Maine was the first US state to introduce a law to put the responsibility of packaging waste on companies. The Extended Producer Responsibility program will put plastic containers, cardboard, and non-recyclable packaging recycling and disposal costs on the manufacturers. Later, Oregon became the second US state to approve a packaging law.

Increasing focus of key players on downsizing of packaging to reduce the cost of production is again projected to uplift the market growth. For instance, recently Rene launched (Fab 5 Collection) with five different lip shades in one tube, which not only increases the product offering for the customers but also reduces the amount of raw material used for the packaging. Also, due to its compact packaging it is highly opted by women as they get to carry less product while getting better variation.

Global Sustainable Packaging Market Opportunities:

Various foodservice companies are replacing single-use plastic straws, closures, lids, caps, cups, and food trays with products produced from paper or compostable alternatives. This initiatives is expected to bring significant growth opportunities over the forecast period.

Companies such as Unilever and Procter & Gamble have started using post-consumer recycled plastics in their packaging solutions to further their green initiatives. Such steps are expected to provide potential growth opportunities for the key players in the near future.

Global Sustainable Packaging Market Trends:

Growing global trend of green packaging is compelling manufacturers to adopt and stay competitive in the market. Mosty, FMCG companies are implementing downsizing initiatives to save costs on raw materials. This factor will favor the market growth over the forecast period.

Manufacturer of personal care are shifting their focus toward green alternatives by reducing the raw materials used in the packaging of products. This is driven by changing consumer behavior regarding sustainability of packaging.                                 

Global Sustainable Packaging Market Restraints:

Lack of manufacturing plants that produces sustainability packaging is projected to hinder the market growth.

High cost of the raw materials is another key factor expected to restrict the market growth.

Figure 2. Global Sustainable Packaging Market Value Share (%), By Application, 2021

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Global Sustainable Packaging Market Segmentation:

The global sustainable packaging market report is segmented into process, material type, end user industry, and region

Based on process, the market is segmented into Reusable Packaging, Degradable Packaging, and Recycled Packaging. Out of which, Recycled Packaging is expected to dominate the global market over the forecast period and this is attributed to the growing environmental concerns worldwide. Companies' most common sustainable packaging techniques include downsizing or light- weighting packaging and increasing the use of recycled content and renewable materials. Recycled paper is easily accessible resource and more environmentally friendly when compared to virgin paper. Recycling paper generates 74% less air pollution and uses 50% less water.

Degradable Packaging segment is also expected to witness significant growth in the near future and this is owing to the growing application across wide range industries due to their low environmental impact. Moreover, growing number of product innovation such as intelligent and active packaging solution is increasing product availability.

Based on material type, the market is segmented into Glass, Plastic, Metal, and Paper. Out of which, Paper is expected to dominate the global market over the forecast period. They are the fastest growing sustainable packaging materials. Additionally, growing online retail and environmental regulations on non-biodegradable and non-recyclable packaging solutions is again creating demand for eco-friendly paper packaging solutions.

Glass segment is also expected to witness significant growth in the near future and this is owing to the growing demand for alcoholic and non-alcoholic beverages. Alcoholic drinks, such as beer, account for a significant market segment, as glass does not react with the chemicals present in drinks. Glass is preserve the beverages aroma, flavor, and strength which makes it favorable option for packaging.

Based on end user industry, the market is segmented into Pharmaceutical and Healthcare, Cosmetics and Personal Care, Food and Beverage, and Other End user Industries. Out of which, Food and Beverage is expected to dominate the global market over the forecast period and this is attributed to the growing adoption of recycled plastic which are available at low cost and are also environmentally friendly.

Cosmetics and Personal Care segment is also expected to witness significant growth in the near future and this is owing to the growing demand for sustainable packaging as consumer are becoming more aware and also government are taking initiatives to promote eco-friendly packaging. For instance, 2020, the sector saw an influx of alternatives to stimulate the industry. Colgate launched its recyclable tube; cosmetic applicators specialist Cosmogen launched the concept of glue-free make-up brushes; and Quadpack was poised to introduce its Nordic Collection jars, featuring compostable wood and biopolymers-based materials.

Global Sustainable Packaging Market: Key Developments

1. In August 2021, Amcor expanded its global network by building to new sites in Asia and Europe. The new centers expand the global reach of Amcor’s innovation network, which currently includes flagship sites such as Neenah, Wisconsin, and Manchester, Michigan, in the United States, as well as smaller sites around the world. The broader network will allow customers globally to tap into the company’s deep material science expertise and packaging development capabilities.
2. In June 2021, WestRock Company announced an expansion of its produce packaging offerings with the launch of its EverGrow Collection. WestRock EverGrow packaging is curbside recyclable when emptied and flattened, supporting the company’s ambition to reduce waste and build a 100% reusable, recyclable, and compostable product portfolio.
3. In June 2021, Liquibox and WestRock partnered to develop Ships In Own Container (SIOC) bag-in-box solution for Amazon that delights consumers, reduces waste, and ensures products arrive undamaged.
4. In September 2021, Heinz partnered with WestRock to replace shrink-wrapped multipacks of Heinz beanz, Heinz soups, and Heinz pasta varieties on supermarket shelves with recyclable paperboard developed by WestRock. The Heinz Eco- Friendly Sleeve is recyclable and comes from sustainably managed forests. The innovative wrap design uses no glue and 50% less material than a fully enclosed wraparound box and 10% less than a traditional paperboard sleeve design.
5. In September 2021, Sonoco partnered with AMP Robotics, a pioneer in AI, robotics, and infrastructure for the waste and recycling industry, to create a new material category within AMP’s neural network specific to rigid paperboard cans. This partnership will result in increased recycling rates for the spiral wound paper canister with steel bottom produced by Sonoco and other manufacturers.

Global Sustainable Packaging Market: Key Companies Insights

The global sustainable packaging market is highly competitive. This is attributed to continuous launch of new technologies due to ongoing R &D and efforts by value chain participants. Moreover, key players are adopting various business growth strategies in order to expand their presence on regional as well as global basis. Some of the key players in the global sustainable packaging market are Amcor Limited, Westrock Company, TetraPak International S.A., Sonoco Products Company, Smurfit Kappa Group PLC, Sealed Air Corporation, Mondi PLC, Huhtamaki OYJ, BASF SE, Ardagh Group S.A, Ball Corporation, Crown Holdings, Inc., DS Smith Plc, Genpak LLC, and International Paper Company

*Definition: Sustainability is becoming increasingly important. Today's consumers are vocal about their desire for eco-friendly brands. In fact, Millennial and Generation Z are more likely to switch brands if they believe a brand is demonstrating a commitment to environmental health. In addition to being environmentally friendly, sustainable packaging is also compatible with current recycling infrastructure