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With the turn of the New Year, goal setting is on everyone's mind. When it comes to sustainable packaging, one goal that is being mandated across global markets is ensuring certain amounts of recycled material are being put back into new packaging. This is known as 'Post-Consumer Recycled (PCR)' content. This is to make sure that at least some portion of the waste being generated is being recovered and brought back into the system. Some countries are requiring all new plastic packaging to have at least 30% of the material composition to come from recycled sources. Others, like the EU, are requiring as high as 70% in some material categories for 2025. Some forward-thinking brands who aren't currently mandated with PCR targets are taking it on themselves to achieve, 75%, 90% or even 100% PCR content in their packaging. We like this movement for the main reason that it is forcing end-markets to be involved with new production. By ensuring a minimum PCR target, you are increasing demand for end-market materials to be fed back into the system, encouraging growth in the sector while minimizing the reliance on new materials. It is helping the industry segue towards a circular economy and unlocking revenue for recyclers to keep expanding their operations.
Post-Consumer (PCR) vs. Post-Industrial (PIR)
Post-consumer recycled content, as the name suggests, comes from a recycling program or facility that recovered the material from a consumer. On the other hand, post-industrial recycled content originates from factories or industries that had excess material from production and sent it to be recycled at a facility.
Understanding this difference is important for compliance reasons and material costs. Compliance frameworks that require the distinction between the two when making marketing claims are the FTC Green Guides and Green Claims Directive. Regulatory requirements are requiring recycled content to be integrated into packages with California mandating 50% PCR in all beverage containers by 2030.
So, with demand on the rise, how do you integrate PCR into your packaging?
Securing a Recycled Content Provider, Contracts, & Pricing
Having a reliable provider for recycled content is key as not all providers are equal. When looking for a PCR provider it is important to understand where their material is coming from and how it is recycled. Some source recycled content from waterways, preventing ocean plastic, while others receive their content from residential recycling programs. On top of the sourcing, some recycled content may go through a more traditional recycling process like mechanical recycling, which does not alter the molecular structure of the plastic, or a chemical recycling process, which breaks down the polymers to rebuild them to a state similar to that of virgin resins.
Brands don't always have to participate in this relationship as some packaging producers will provide recycled content providers or provide a package made entirely of recycled content off the shelf. When brands purchase PCR directly from the recycler, there are benefits such as negotiating pricing based on company-wide initiatives, gaining access to transparent pricing and usage, and further a direct relationship for future opportunities. This comes with the tradeoff of more work on the brand; some converters may feel sidestepped as they are the ones who typically purchase PCR, and there is a lot of nuances the brand will have to understand, such as material handling, equipment retirements, quality standards,, and processing procedures.
The more typical approach is when converters purchase the PCR and this is their preferred approach. Some of the benefits of converters purchasing PCR include purchasing larger volumes by representing multiple customers or brands, setting the quality and material requirements that match their equipment requirements, and ultimately are hands-on with the material. Converters will be faster and more efficient when making decisions based on market conditions. The downsides of having the converter handle the purchasing are a lack of transparency in the price, and the brand cannot track the volume of material being used.
In Scrapp's opinion, we recommend working with converters rather than taking on the task yourself, as recycled content markets are still in their infancy. By securing long-term agreements with mechanisms such as price floors & price ceilings, cost-plus models, or infrastructure investment funds coupled with offtake agreements and first right of refusal for PCR or packages produced by the funded infrastructure. In conjunction with LTAs, any standard contract can have stipulations put in place to ease concerns from both parties. These can consist of audits, standard lead and delivery times, payment terms, quality standards, minimum order quantities, and contract length (time or volume-based).
Factors That May Impact PCR Price
These factors are similar to what affects the recyclability of plastic packaging, and the integration of recycled content can be more difficult from a design, function, and access perspective based on how much a brand or converter is willing to pay for the content. Factors that impact price are color, consistency of material, contamination tolerance, recycled content availability/market conditions, FDA letters of no objection (approval), premium certifications such as "Ocean Plastic" or "Fair Trade," transportation costs, and costs of virgin material.
Working With Your Packaging Provider or Converter
Having a packaging provider you can work with is paramount. Each material has design limitations (outlined in the next section), and integrating recycled content requires an iterative design process. Going in with realistic expectations and a plan will ensure long-term success and higher recycled content integration with less loss of function.
Design Limitations of Integrating Recycled Content
Every design and material is unique in the amount of and difficulty associated with integrating recycled content. Some materials even have unique challenges. See the list below detailing the challenges each material faces and how easy it is to integrate recycled content.
Cardboard & Fiber:
Ease of Integration: Easy
Fiber products are among the easiest to integrate recycled content as they have well-established markets and have been integrating recycled content for decades. The issue they face with integrating recycled content is the quality of paper, as the more recycled content that is integrated, the more variable the packaging or product performance becomes. The quality may drop, but it will still meet all product requirements. The biggest challenges that fiber faces when integrating recycled content include maintaining fiber length (fiber length decreases every time a package is recycled), avoiding contaminants in recycled content that may affect the product, and market volatility as corrugated prices can fluctuate dramatically from as low as $25 to $167 per ton.
Aluminum:
Ease of Integration: Easy
Aluminum is one of the most accessible recyclable materials due to its high demand, deposit return programs, and ability to be sorted at a MRF. It is desired because of the amount of energy recycled aluminum saves relative to its virgin counterpart. Recycled aluminum uses 95% less energy than virgin aluminum due to virgin aluminum's extremely high smelting temperature. Integrating recycled content delivers little to no loss in quality or performance. Some challenges, such as the labels on craft beer cans, have contaminated the once pure aluminum stream. Additionally, due to the plastic lining inside an aluminum beverage can, claims such as "infinitely recyclable" are deemed deceptive. There are some challenges around aluminum aerosol can recycling as their collection rates are lower, but other organizations are addressing this. Regardless of these challenges, aluminum succeeds at integrating recycled content and is on track to hit industry targets.
Glass:
Ease of Integration: Easier
Glass can be recycled indefinitely without losing quality, so integrating recycled content from a material perspective is easy. However, challenges arise regarding access to high-quality recycled glass (cullet), sorting by color, and contamination from other materials. These are not insurmountable from a technology perspective, but making them economically viable is challenging, depending on the market. Integrating recycled content is possible but requires additional quality checks to ensure no impurities have entered the package.
Rigid Plastic Containers:
Ease of Integration: Intermediate
Integrating recycled content with rigid plastic containers is feasible and is becoming an industry-wide practice for plastics like rPET and recycled HDPE for bottles and containers. The design requirements are possible, with Coca-Cola recently succeeding with their 100% recycled rPET bottle. There are still design challenges with polymer chains shortening through the recycling process and contaminants affecting the bottle's color, clarity, and function. Technology is improving, and the amount of recycled content introduced is more per package.
The challenge comes with differing forms of plastics, such as thermoforming vs blown form plastics, that do not always produce the same quality recycled content. For example, bottle-grade rPET trades higher than thermoform-grade. Other challenges include maintaining color, clarity, and complying with food-grade packaging standards. Bottle-to-bottle recycling is rare relative to downcycling opportunities where rPET is used in carpeting and textiles. Natural-grade HDPE trades at a high price and dominates the plastics market regarding recycled content. Polypropylene is still facing challenges as it has more requirements to be converted into market-ready rPP.
Flexible Plastic Containers:
Ease of Integration: Very Challenging
Flexible plastics can integrate recycled content from a functional perspective, but purity is important. The challenge arises with getting access to high-quality recycled content to integrate into their design, which isn't accepted curbside in most communities. Flexibles currently have a very low recycling rate, so recovering the material for more PCR is difficult. Soft plastics also damage mechanical recycling equipment when placed in a single-stream environment. Design challenges such as impurities in the recycled content can also cause soft plastic packages to experience failure. Despite these challenges, some packaging companies provide off-the-shelf mono-material flexibles that contain PCR, but every package is unique in its manufacture and design. Multi-material or Multi-layer soft flexibles currently struggle to incorporate recycled content. Most don't get recycled due to the design complexity and low economic viability.
How can Scrapp Help?
If you are a brand or retailer looking to improve the sustainability of your packaging but don't know where to start, book in a call or reach out to the team . We have years of experience in waste, recycling and packaging to help kickstart your sustainable packaging journey.
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