SUSTAINABILITY: packaging and Smart supply chain integration | 25-03-2024 |

As part of AIPIA’s build up to the Smart Packaging for Sustainability Webinar on 26th April the next two newsletters will feature some insights on this important topic from industry leaders.  We welcome Peter Stael from, Swiss-based Across-Consult with his views on Smart supply chain integration.

The driving force on all the developments we see regarding sustainability in the packaging industry, from a legal perspective in the European Union, has its base in the ongoing discussion within the Union, now moving into policy, regarding the environmental impact of the way in which products are produced on a global scale, and the consequences it has on global warming and climate change.

Although the relation between our way of producing and the effect of global warming was already known since the 1890s, it took the EU until the 2010s to start giving the highest urgency to the topic. The urgency has grown since international conferences on climate change and the succeeding COP events empowered policymakers, from 2019, to start up a profound plan, resulting in the European Green Deal, as decided in 2020.

The main objectives here are the development of a circular economy, based on the cradle-to-cradle principle. A major consequence of this way of producing is expected to be a reduction of dependency on oil/coal-based production to reduce CO2 emissions, global warming and climate change. The Green Deal policy target of the EU is to be a net-zero contributor to CO2 emissions in 2050.

As a consequence of the Green Deal policy, many more specific targets were formulated or are under scrutiny to be revised. The main EU directive on Packaging Directive 94/62/EC, now under revision by the EU parliament and expected to become Packaging Regulation (EU) 2019/1020, which, among other aspects, would force FMCG-producers and retailers to turn their products more and more from traditional plastic-based packaging to recyclable and/or compostable packaging.

These new rules set 3 categories of packaging. 

o Mono-material packaging;

o Compostable (home and industrial) packaging;

o Reusable packaging.

Eco-friendly packaging (recyclable, biodegradable and compostable) will be a “must” future alternative to old fashion packaging materials. It is very important already now in the EU to create conditions for renewable materials that can be fully returned to reproduction (recycling) or compostable (give nutrients back to Earth).

Considering the broad range of products and packaging alternatives at status, this is already and will be even more in the future a major challenge to the industry. Reference should be made also to the Extended Producer Responsibility, formulated by the OECD in 2016. Following these OECD guidelines in 2022 the European Commission published the draft legislation, called the Packaging and Packaging Waste Regulation (PPWR), which has the scope to change EU rules on packaging waste

This legislation is currently a draft and subject to change, however, most of it is expected to remain unchanged. Extended Producer Responsibility creates  changes in the way in which plastics are considered and plastic taxing is on the way and will become mandatory for every member-state to apply by the end of 2025.

For producers of FMCG goods though, eco-modulation must be based not on recyclability or compostability performance, but also, as much as possible, on post-consumer recycled (PCR) content. The problem though with PCR content is that there is by far not enough raw material available, which increases the challenges the industry faces.

Besides the above aspects the guidelines create, combined with the above-mentioned EU-Regulation the pressure on FMCG producers and retailers, not only to change their packaging but also to be responsible for everything that happens with their productand packaging after sales! As said, the consequence is that the FMCG producers and retailers will for certain bear costs for the waste collection, but probably also (at some stage) for the consequences of their contribution to global warming and climate change. 

The combination of the Regulation and the EPR could lead to the need, not only to modify the packaging materials, but also to document in detail the way in which each packaging, or better: each product, is produced. FMCG producers in Europe should also consider the EU-directive 85/374/EEC on liability for defective products.

When the EU directive on liability is modified, it becomes the producer/retailer that needs to demonstrate that the product was made in a good and healthy way, and a need is created to document every detail of the product, from its very origin to its very end. So to make this practical a chicken breast consumed yesterday needs to be backed by documentation showing even what the chicken has eaten from the first day of its birth until being slaughtered.

Along with sustainable packaging these Regulations create the need for full and complete documentation (traceability) and the need to reorganize their management. As a central point of communication between producer and consumer the packaging bears ever more responsibility!

EU regulations must also be seen in a global context. As the EU market is still the biggest consumer market in the world, this means that EU regulations on many occasions are, to some extent, an international standard. Also decisions of the EU Green Deal on C02 emissions are considered among the highest levels in the world, and therefore could be considered as a kind of benchmark..

Where sustainable production leads to net zero-emission, regeneration production should have a positive impact on reducing global warming, through a net-negative emission, by reducing or gaining back, the CO2 already emitted. Research shows that packaging contributes only a small amount of total global  CO2 emissions. Transport, production, and especially farming, contribute much more.

This leads to the conclusion that intervention in the supply chain, becomes more and more in focus, as the effect of an enhanced supply chain is way higher than that of ‘only’ the individual packaging. How important (and also complicated) the individual packaging already is, then reorganisation of the supply chain is even more important.

Some examples of interventions in the supply chain, are projects like: Holy Grail 2.0 for digital watermarking of different plastics; the Sempack-project to redesign plastic bottles and pouches; Keep it Fresh indicators for perishable products, and its enhanced version using a freshness indicator combined with barcode. Also interesting is the Collimetrix-project from Royal Joh Enschede, Netherlands, as this also would be in line with the digital labelling-initiative of Food Drink Europe.

The Farm to Fork strategy and the concrete supply chain enhancing projects show the tendency in the market to find solutions also on the level of the supply chain, rather than only focussing on the mere sustainability of the packaging. We may expect the tendency towards regeneration to increase in the next coming years and expect and experience that long-term strategy from FMCG-producers to be more and more concentrated on these type of solutions. Retailers and brand-owners bear a responsibility here to look ahead at these developments and take a leading role.

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