The Top 4 Challenges Facing PET Producers: Navigating Sustainability and Supply Chain Pressures

1. Recycled Content Mandates

PET producers are already familiar with adapting to the changing legislative landscape surrounding recycled content, but the requirements are becoming more stringent.

In Europe, the EU Packaging and Packaging Waste Regulation (PPWR) mandates a 30% recycled content target for plastic packaging by 2030, with a lower target of 10% for food-grade packaging. Meanwhile, in the U.S., several states—including Washington and New Jersey—are proposing similar mandates for recycled content. However, the lack of adequate recycling infrastructure and ongoing supply chain challenges are delaying the implementation of these policies.

While most African and Asian countries have yet to enforce strict recycled content mandates like Europe and the U.S., there is growing awareness around plastic recycling, particularly for food-grade PET. For instance, India is enhancing its Extended Producer Responsibility (EPR)policy, holding manufacturers accountable for the recycling and disposal of products at the end of their lifecycle. Similarly, Kenya has had a nationwide plastic bag ban since 2017, and Guinea and Nigeria are following suit with measures targeting single-use plastics (excluding PET bottles). 

2. Consumer Demand for Sustainability

Consumers increasingly say they want more sustainable packaging, but their actual purchasing behavior often contradicts these claims. Many express willingness to pay more for eco-friendly packaging, but hesitation arises when they face price increases in reality.

This creates a challenge for brands, which aim to meet sustainability goals while maintaining profitability. The best strategy for many businesses is to make sustainability invisible to the consumer in terms of cost but still present it clearly in messaging. Key solutions include designing for recyclability, lightweighting, downgauging, and implementing tethered closures—all of which are essential for aligning sustainability with cost-efficiency.

3. Limited Recycling Infrastructure

One of the biggest obstacles to meeting recycled content mandates is the insufficient access to reliable recycled PET (rPET). The lack of investment in necessary recycling technologies and infrastructure means that the volume of rPET required to meet these mandates simply isn't available.

This shortage causes price volatility in rPET, making it difficult for manufacturers to offer sustainable packaging at competitive prices. Additionally, the fragmentation of recycling regulations across different regions further complicates the situation, making compliance even more challenging. While the timeline for infrastructure improvements is long, the pressure for action is mounting as mandate deadlines approach.

4. Intense Supply Chain Competition

The demand for rPET is not limited to the packaging industry; sectors like food and beverage, textiles, construction, and automotive manufacturing are also vying for the limited supply of rPET.

As a result, PET producers face high competition for rPET, exacerbated by the slow development of recycling infrastructure. Producers that can secure a reliable source of rPET gain a competitive advantage, but the overall competition remains intense, driving up costs and limiting availability.

Conclusion

These four challenges underscore the need for greater industry collaboration, investment in recycling technologies, and standardized policies across regions. For PET producers to stay competitive and fulfill sustainability goals, the industry must innovate and adapt throughout the entire value chain. Addressing these issues will require collective action and a long-term commitment to sustainability.

Reference

1.CZAPP(December 3, 2024) |The Big 4 Problems Facing PET Producers

2.Packaging Gateway(September 23, 2024)|Guinea enacts ban on single-use plastics

3.New Telegraphng (December 4, 2024)|Ban Single-Use Plastics From 2025, Stakeholders To FG

4.Bizzbuzz News( May 10 2024)|How EPR, ESG revolutionising waste management in India