The global market for sustainable packaging is anticipated to increase at a CAGR of 8.5% between 2024 and 2032. The increase in the market is a result of the government's tough regulations on sustainable development and the packaging industry's growing demand for recycled packaging materials. Sustainable packaging refers to the creation and utilization of packaging that promotes sustainability. It largely relies on life cycle analysis and inventories to guide packing choices and minimize its environmental impact. Benefits offered by sustainable packaging products such as strength, transparency, insulation, and water resistance, the growing use of sustainable packaging in industries such as healthcare, pharmaceutical, automobile, nutraceutical, and fashion, the increase in global plastic pollution, the use of a wide range of sustainable packaging products by modern agricultural practices to increase productivity, and the capacity of sustainable packaging to preserve a product's in-store freshness are all discussed. However, the high cost of raw materials inhibits the global market's progress. In contrast, rising demand from end-use industries, less reliance on petroleum resources, and advancements in research and development (R&D) will generate new growth opportunities for the worldwide industry in the next years.

Environmental pollution concerns spurred Beijing laws and the prospect of a ban on conventional plastics, such as single-use non-biodegradable plastics like as cutlery, plastic bags, and packaging. Consequently, manufacturers have been concentrating on extending the use of corn, sugar, and other crops in the creation of biodegradable polymers. It was discovered that Jilin Province and the tropical island of Hainan will impose additional bans on single-use plastics and non-biodegradable food service goods by mid-2021. In 2021, for example, Maine was the first U.S. state to implement legislation mandating the packaging of garbage. Under the Extended Producer Responsibility initiative, manufacturers will be responsible for the recycling and disposal of plastic containers, cardboard, and non-recyclable packaging. Oregon thereafter became the second U.S. state to approve a packaging law.

According to a recent survey on sustainability and changing consumer behavior done by Capgemini, 79% of consumers are shifting their purchasing habits mostly due to social responsibility, inclusivity, and environmental impact. Moreover, 53% of consumers and 57% of those aged 18 to 24 have shifted to lesser-known brands because they are more environmentally friendly. A little more than 52% of customers reported having an emotional connection to sustainable businesses or organizations.

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Before purchasing a product, people evaluate numerous factors, including the company's brand image and packaging designs. As a result of government awareness programs and laws, consumers are aware of sustainable products and their relevance in environmental conservation. Numerous corporations suffer harsh criticism from diverse consumer groups regarding their packaging practices and are compelled to embrace sustainable packaging alternatives. In recent years, a number of global events have prompted corporations to boost their investments in R&D programs for the creation of recyclable packaging and their support of various government efforts for sustainable development. The Swiss food and beverage manufacturer Nestlé S.A. said in January 2021 that it will invest approximately $2.03 billion in novel sustainable packaging solutions. The expenditure was made in compliance with Nestlé S.A.'s 2018 commitment to use 100 percent recyclable or reusable packaging by 2025.

The widespread availability of inexpensive alternatives to sustainable packaging, such as paper bubble wrap, paper tape, and cornflour packaging, is a significant factor hindering the global sustainable packaging industry's growth. The recycling of packaging materials is an extremely expensive process, and the price changes of raw materials present substantial economic obstacles. In addition, the lack of recycling facilities and insufficient storage units, especially in developing regions, are barriers that may limit the market's growth in the coming years. It is projected that the lack of sustainable packaging manufacturing facilities will restrict market expansion. Additionally, the high cost of raw materials is predicted to impede market expansion.

As governments around the world are cognizant of the challenges posed by environmental issues, several initiatives and laws have been implemented to encourage the production of sustainable packaging. Government actions to subsidize package manufacturers, especially in industrialized nations, give market participants profitable opportunities to boost their present production output. As a result of these government actions, important market parties have begun investing in the development of various packaging waste recycling schemes.

On the basis of material type, the paper and paperboard sector was the largest market in 2021, accounting for more than two-fifths of the global market share for sustainable packaging, and is expected to maintain its dominance during the forecast period. This is because paper and paperboard are more recyclable, biodegradable, non-toxic, and environmentally friendly than other materials. In comparison, the other group is projected to experience the greatest CAGR of 8.5% between 2024 and 2032. The other section comprises glass used in packaging, dinnerware, and buildings & structures, among other things. Among its many advantages are transparency, dust resistance, water resistance, color availability, recyclability, UV stability, weather and rust resistance, ease of molding, electrical insulation, and sustainability.

Throughout the period forecast, the rigid packaging segment will continue its preeminent position. In terms of package type, rigid packaging dominated approximately three-fifths of the worldwide sustainable packaging market in 2021. Food, medicine, electronics, toys, personal care products, office supplies, and tools are examples of products that use stiff packaging. Additionally, it is cheap and exceptionally impact-resistant. The segment of flexible packaging is expected to enjoy the largest CAGR between 2024 and 2032, at 7.5%. Rapid lifestyle changes have raised the demand for portable objects, for which bioplastics are often used in flexible packaging. This may be one of the key elements driving the expansion of the flexible packaging bioplastics market.

Due to rising environmental concerns around the world, it is predicted that recycled packaging would dominate the global market for the duration of the forecast. Common sustainable packaging solutions adopted by firms include packaging downsizing and lightening, as well as increased use of recycled materials and renewable resources. Recycled paper is readily available and more environmentally friendly than virgin paper. Reusing paper decreases air pollution by 74% and water consumption by 50%. Due to their limited impact on the environment, the Degradable Packaging market is predicted to experience rapid growth in the near future. This is a result of its expanding use in a wide variety of industries. Additionally, a growing variety of product innovations, such as intelligent and active packaging solutions, are enhancing product availability.

Due to the increasing adoption of recycled plastic, which is readily available at a low cost and environmentally advantageous, the food and beverage segment is likely to lead the global market over the forecast period. Moreover, the cosmetics and personal care business is predicted to undergo rapid expansion in the near future. As customers grow more environmentally concerned and the government takes steps to promote eco-friendly packaging, there has been an increase in the demand for sustainable packaging. In 2020, for instance, the sector witnessed an influx of industry-stimulating alternatives. Colgate debuted a recyclable tube; Cosmogen offered the concept of glue-free beauty brushes, and Quadpack was set to launch its Nordic Collection jars made from compostable wood and biopolymers.

Based on region, Asia-Pacific was the largest market in 2021, accounting for more than two-fifths of the global market share for sustainable packaging, and is expected to maintain its dominance during the forecast period. The same segment is projected to have the greatest CAGR during the forecast period, at 7.8%. Urbanization has enabled the rise of the sustainable packaging market in the Asia-Pacific region. Additionally, the existence of large manufacturing companies, particularly in the healthcare, pharmaceutical, and cosmetics industries, helps the growth of the regional market. The top Chinese e-commerce sites and accelerated shipping businesses have taken steps to limit their packaging material usage.

Countries such as France, Germany, and the United Kingdom exceed the severe recycling requirements of the European Union with Extended Producer Responsibilities (EPRs). In Asia, Thailand has announced a ban on single-use plastic bags beginning January 1, 2020, in all major stores. To reduce plastic pollution, the bill called for a comprehensive ban by 2021. Due to rising government efforts to restrict the amount of waste delivered to landfills, it is anticipated that Europe would have the biggest increase during the forecast period. For instance, the government has proposed that beginning in 2023, every local authority in England should offer a separate weekly food waste collection service for households. Over 600 firms participate in the On-Pack Recycling Label (OPRL) recycling scheme throughout the United Kingdom. Due to favorable government initiatives that are increasing demand for sustainable and biodegradable packaging, North America is projected to enjoy substantial expansion over the forecast period. Furthermore, significant companies are implementing compostable packaging options. For example, the vegetarian meat replacements of No Evil Foods are packaged in compostable Kraftpak containers with plant-based printing. Previously, No Evil Foods used butcher paper with non-biodegradable stickers, making it impossible to compost.

The global market for sustainable packaging is highly fragmented and, thus, quite competitive. The market leaders are Amcor Limited, TetraPak International SA, WestRock Company, Smurfit Kappa Group PLC, and Sonco Products Company. This is the product of ongoing research and development (R&D) and value chain partners' efforts. In addition, significant companies are utilizing a variety of corporate growth strategies to expand their regional and global impact. Key players in the global sustainable packaging market include Amcor Plc, Westrock Company, TetraPak International S.A., Sonoco Products Company, Smurfit Kappa Group PLC, Sealed Air Corporation, Mondi PLC, Huhtamaki OYJ, BASF SE, Ardagh Group S.A., Ball Corporation, Crown Holdings, Inc., DS Smith Plc, Genpak LLC, and International Paper Company.

In April of 2023, WestRock Company announced a partnership with Recipe Unlimited to adopt a variety of recyclable paperboard packaging in an effort to divert 31 million plastic containers per year from Canadian landfills. The bundle became available at all Swiss Chalet restaurants in October 2021. In April 2023, Sealed Air announced cooperation for an advanced recycling program focused on recycling flexible plastics from the food supply chain and reusing them to create new certified circular food-grade packaging.