Market outlook: Circular economy, sustainability key trends at NPE

17 May 2018 20:31 Source:ICIS Chemical Business

Sustainability will continue to be a trend driving the plastic packaging industry, with recycled polyethylene terephthalate (R-PET) at the forefront of the circular economy effort, delegates said at this year’s National Plastics Exposition (NPE).

Delegates in different sectors, from machinery makers to industry analysts, noted a focus on R-PET and the circular economy.

One exhibitor in the renewable sector of the show said most attendees stopping by his booth inquired about R-PET.

NPE

“It seems to have the highest demand,” he said, compared with other plastics.

The industry has “picked the low-hanging fruit” of using more recyclable materials, reducing packaging material and becoming more energy efficient, Ron Puvak, managing director of the Contract Packaging Association (CPA), told NPE delegates.

Now, brand owners are making sustainability part of their identities and zeroing in on more complex issues of creating bio-based materials that can compete on cost with traditional petrochemicals.

“Sustainability continues to be something we’ll drive,” Puvak said. “If they can make money at it, they’re going to do it.”

As a whole, Puvak said, the global packaging industry is projected to grow by 3.5% annually with sales of $997bn in 2020. PET demand, specifically, is expected to increase by 4.6% each year, Puvak said.

WATER SOURCE

Bottled water, which is a $13bn business, will be a major driver of PET demand as health-conscious consumers increasingly reach for it, Puvak noted.

Traditional soda brands such as Coca-Cola and Pepsi will lead the growth as they offer healthier alternatives.

“The plastic water bottle is one of our biggest success stories,” Puvak said.

Health and wellness will be a major driver of packaging trends as consumers and brand owners both prioritise these as goals. Pepsi has listed both health and the environment as major pillars in its 2025 sustainability plan.

Regarding sustainability, the industry has largely addressed using more recyclable materials and becoming more energy efficient.

The big move will be toward making renewable-sourced polymers at the same cost of virgin and implementing circular economies, Puvak said.

“Plastic packaging has the unique ability to help with sustainability and health and wellness,” Puvak said.

In the same realm, health concerns and regulations surrounding materials will continue to drive transparency in the supply chain.

Other trends that will drive the packaging industry include marine conservation, private brand growth and e-commerce such as meal kits and online retailers of food like Amazon.

SIPA INITIATIVES

Plastic needs to be viewed as a resource if global PET bottle consumption continues to grow, Italy-based SIPA general manager Enrico Gribaudo told NPE delegates.

Each year, 32% of plastic consumed ends up in the ecosystem, creating marine litter that harms wildlife and human health.

Gribaudo highlighted his company’s joint effort with Austria-based recycling technology firm EREMA to use the companies’ existing technologies to create an integrated system that makes preforms from 100% recycled PET.

The technology differs from traditional systems in that it processes the raw material bales directly into clean washed flake, eliminating pelletising and associated emissions.

Traditional recycling systems reduce emissions by 63% whereas the SIPA/EREMA technology reduces them by 83%, Gribaudo said.

“It’s not a problem of technology. It’s a problem of society,” he said, pointing to the need for better recycling to yield uncontaminated collection streams.

The EU has set out to make all plastic packaging recyclable by 2030 in an effort to reduce single-use packages.

In the US, the R-PET market has an opportunity for growth amid a tight market for virgin PET resin through the remainder of 2018 and 2019.

The plastics industry is getting increased encouragement from consumers for low-cost recyclable alternatives, which is pushing plastics additives manufacturers’ development, US specialty chemicals firm Vertellus said at NPE.

The demands for sustainability differ geographically for customers, and range across products from the medical devices market to power tools, said Ashok Adur, Vertellus consultant for plastics and polymer innovations.

Most US customers, he noted, have the choice of looking for products that can fluctuate between affordability and sustainability.

“It’s not just cost savings – it’s sustainability,” he said. “In the US, sustainability is a marketing advantage. It’s not really driven by regulation. But in Europe it’s mandated.”

End-market consumers are also pushing trends towards less toxic materials, such as wanting bisphenol-A (BPA) alternatives.

“BPA is safe for most people, but not safe for women who are pregnant, or newborn babies,” he said. “And that’s the issue.”

Adur said Vertellus’ BPA replacement Topanol is slightly more expensive, but as an additive gives better performance than BPA itself.

By Amanda Hay