The worm has turned for the acceptance and uptake of reusable packaging, but significant challenges remain. Regulatory changes in the U.S. and greater commitment from brands in driving demand for recycled content would go a long way toward creating the robust recycling infrastructure needed to promote the diversion of plastic from the waste stream.
First, the good news is that interest in reusables is growing quickly. “We spent 20 years talking about why reuse, and it’s becoming much more apparent today than it was even five years ago, said Tim Debus, RPA CEO and panel participant. “So we’re pivoting our resources to talk more about how to reuse, and that also includes consumer packaging because there’s a lot of upstart energy, enthusiasm, and critical needs to look at reuse and refill models in the consumer products space.”
ESG and Circular Economy: Terminology and Expropriation
Debus discussed the differences between ESG and circular economy. He noted that ESG is an investor tool. “ESG is about reporting performance and measuring that performance,” he said, “so that investors can hedge the risks in investing in the companies.”
Circular economy, he noted, is distinctly different than ESG and sustainability. The circular economy is an economic growth model designed to achieve economic growth that is decoupled from resource consumption. “So that’s why there’s an emphasis on things like source reduction in reuse and a circular economy,” he said, because it does stop that the flow of continuous the consumption of natural and raw materials.”
Debus observed that some companies and trade groups are claiming to be circular, when in fact they operate or support linear supply chain models. “Many of them are greenwashing,” he said.
The Economics of Recycling and Reuse
In the absence of regulatory changes, the development of a robust plastic recycling infrastructure must be driven by demand. And a consistent demand for recycled material, along with signed long-term contracts, is something that recyclers can take to the bank to get the financing needed to build the recycling infrastructure.
At the present time, Janson noted, however, that not enough resin buyers are committed to supporting recycled content. The U.S., he commented, is the cheapest place in the world to produce virgin resin, and capacity has risen dramatically. At the same time, anywhere from 8-12% of new resin production is off-spec or wide-spec, which he said is dumped into the market by petrochemical producers at cost. “It’s very shortsighted,” he said. Wide-spec dumping disrupts recycled resin demand and recycled plastic sales, making it difficult for recyclers to convince lenders to supply the necessary capital to grow.
By doing so, Janson believes they are destroying the very industry (recycling) that they point to as the end-of-life solution for the plastics they produce. “I’ve got a problem with that,” he said.
Price-sensitive customers can be quick to take advantage of off-spec, but this false economy from a sustainability perspective. Off-spec new resin has the same environmental footprint as on-spec virgin resin.
The two biggest challenges that Flores sees relate to the availability of recycled content material suitable for food contact, as well as the economics of supporting recycled content. “Every business is a for-profit business, so when you say I want you to pay a lot more for recycled content, or maybe it’s only a small amount, but spread over millions and millions of packages and products,” he said, “it starts to add up, so it’s really difficult. One of the greatest challenges is ultimately the economy. We need the right quality material at the right price. And when we have that it truly will be sustainable and it’ll just take off like wildfire.”
ESG and Plastic Pallets
One hurdle facing the growth of recycled content plastic pallets is the belief that they do not perform as well as virgin material pallets. This claim was challenged. “You can come up with a product that’s made out of 100% recycled content that will perform just as well as any virgin alternative,” Litjens stated.
The conversation shifted to how more customers can be enticed to buy recycled content products. The panelists agreed that while recycling to reintroduce into new food-grade packaging is daunting, secondary or tertiary packaging applications provide an ideal solution. A wider adoption of plastic tertiary packaging could create the demand needed to support the growth of recycling infrastructure.
Flores noted that while he has never seen an ESG checklist that identified reusable pallets, the adoption of reusable packaging can help improve sustainability metrics in areas such as procurement, shipping, and waste reduction. Moreover, he observed that a sustainability report is a narrative, and the adoption of reusable pallets can be part of your success story.
“If you’re making good business decisions that make the business more money, by increasing efficiency, and you also have an environmental story to tell, that’s the ESG Holy Grail. That’s the home run.”
From: reusable packaging news