Challenges of the Circular Economy

January 15, 2025|Exclusive Features, Materials, Sustainable

Mono-material packaging can simplify the recycling process. ©Philip– stock.adobe.com

Barriers the packaging industry must overcome.

By Mike Jones, Mainetti’s Head of Innovation

The climate crisis is becoming increasingly urgent as we approach several tipping points that could lead to the irreversible damage of our planet, as revealed by the 2023 Global Tipping Points report. Sustainability has therefore become a critical concern across a range of industries. The packaging industry is one such sector transitioning towards sustainability, with recent initiatives focusing on prioritizing a circular economy. Although these changes are significant, they continually fall short of adequately addressing the industry’s long-standing reliance on single-use materials.

The 2020 U.S. Plastics Pact set a goal for 100 percent of plastic packaging to be reusable, recyclable, or compostable by 2025. Signatories of the pact include major corporations like Coca-Cola and Nestlé. However, the pact’s 2022 annual report found that participants fell short of these targets, with reusable, recyclable, and compostable packaging below 50 percent. The Pact therefore introduced Roadmap 2.0 in 2024, extending the deadline to 2030. While the Pact demonstrates a commitment to advancing a circular economy, the limited progress underscores the need for continued efforts.

The reality is that achieving the circular economy involves a range of significant barriers that are yet to be overcome.

The Complexity of Packaging Materials Leads to a Complicated Recycling Process

The variety of diverse material types is a major obstacle hindering the success of the circular economy, especially in the context of plastic packaging.

Given the wide range of plastics used in the packaging industry, a single product is frequently composed of various types. This poses challenges because each plastic material requires a distinct recycling process meaning consumers must separate each item for proper disposal. This complex and time-consuming process increases the risk of contamination. In fact, a 2023 survey by California Management Review revealed that about 25 percent of items are incorrectly placed in recycling bins. Despite 94 percent of U.S. residents expressing support for recycling, the country’s recycling rate remains low, ranging from 32-34 percent. This highlights the disconnect between consumers’ willingness to recycle and the effectiveness of current recycling practices.

Mono-material packaging offers an innovative solution by simplifying the recycling process. Using a single material eliminates the need for sorting and separating different components, making recycling more efficient. This approach leads to higher recycling rates compared to multi-material packaging, fostering a more efficient and sustainable recycling system. By promoting the development of sustainable products, the packaging industry can work to improve the startling reality that only nine percent of the world’s plastic waste is effectively recycled, as revealed by the Organization for Economic Co-operation and Development (OECD).

Insufficient Recycling Infrastructure and Government Investment

To enhance recycling rates, governments need to establish and enforce a comprehensive recycling infrastructure that can effectively recycle packaging products, ensuring materials remain within a closed-loop supply chain. While some countries are making significant progress in this area, others are falling behind.

A 2023 meta-analysis conducted by Roland Berger and the Alliance to End Plastic Waste found that 60 percent of the 192 countries studied had underdeveloped or emerging waste systems, with less than eight percent of plastic waste being recycled. The analysis highlighted that the U.S. is still evolving in this area and requires government action to establish a standardized approach. In fact, the current regulations for solid waste management in the U.S. were established by the Resource Conservation and Recovery Act in 1976, meaning it has been over 47 years since the U.S. updated its approach to waste management.

The Netherlands boasts one of the highest recycling rates for packaging at 82 percent, as reported by NetZero Pathfinders. This is thanks to its well-developed and efficient system supported by Nedvang, a Packaging Recovery Organization (PRO). Through government-backed initiatives such as this, the Netherlands is setting a benchmark for what countries need to do to achieve a circular economy. The U.S. is striving to follow this lead. In 2023, eleven US states introduced packaging Extended Producer Responsibility (EPR) Bills for packaging. For example, Colorado will mandate that consumer packaging producers join the Circular Action Alliance starting in 2026.

Without a comprehensive national recycling infrastructure, the efforts of businesses, consumers, and NGOs to embrace the circular economy will struggle to achieve widespread success. For the U.S. to realize a truly circular economy, additional measures are essential.

Shifting Industries Away from Single-Use Packaging Solutions

Without government intervention, the industry remains reliant on non-recyclable or difficult-to-recycle materials. Examples include carrier bags, bread bags, blister packaging, plastic straws and cutlery, which are generally non-recyclable. The U.S. is starting to move towards a circular economy to combat this issue. In 2022, President Biden announced the Secretary’s Order which aims to eliminate the distribution of single-use plastic products by 2032. Furthermore, in 2024, twelve states, including California, New Jersey, and Washington, enacted bans on single-use plastic bags.

These efforts have faced substantial resistance from the industry. For instance, during negotiations on the UN’s global plastics treaty in April 2024, discussions were praised for advancing from vague goals to clear treaty language. Despite this, an analysis by the Center for International Environmental Law revealed a 37 percent increase in the number of fossil fuel and petrochemical industry lobbyists compared to the previous session in November 2023. This surge resulted in lobbyists outnumbering both national delegations and scientists at the session, underscoring the growing concern that governments are being obstructed in their efforts to advance toward a circular economy.

Additionally, the California Legislature passed S.B. 54 in 2022, the most comprehensive extended producer responsibility law in the nation, representing a significant shift in allocating waste management costs to manufacturers. Under S.B. 54, single-use packaging must contain at least 30 percent recycled, reused, or composted materials by 2028. Attempts to pass versions of the law in 2019, 2020, and 2021 were unsuccessful due to opposition from industry stakeholders.

In 2024, a ballot measure was proposed called California Recycling and Plastic Pollution Reduction Act which planned for even more ambitious targets, such as for all single-use packaging to be reusable, recyclable, or compostable by 2030. However, this ballot measure was replaced by S.B. 54 to gain wider support from various stakeholders, including lawmakers and industry representatives. The compromise facilitated the passage of the bill with reduced industry resistance as it presented more moderate objectives, allowing for greater input from the industry.

Although S.B. 54 marks progress and represents a significant step toward addressing plastic pollution, demonstrating the government’s efforts to promote circular economy practices, the influence of industry opposition in weakening its provisions reflects a less ambitious approach than what is needed to effectively tackle the climate crisis. This underscores the ongoing challenges in achieving meaningful change.

It’s clear that both governments and industries must shoulder responsibility. To halt the damaging practices exacerbating the climate crisis, everyone has a role to play. Businesses need to develop innovative sustainable solutions to transform the packaging industry, while consumers should be conscious of their purchasing and recycling habits. Governments must establish adequate infrastructure for effective collection and recycling of materials, meaning that where single-use packaging is essential – such as in medicine and some food sectors – the resultant waste can be properly managed and kept within a closed loop supply chain. Lastly, when green legislation is proposed, the industry should support it rather than pose additional barriers.

About the Author

Mike Jones leads a team of 50 research and design specialists at Mainetti and holds patents for sustainable packaging designs. Please visit www.mainetti.com for more information.

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