Thinking outside the (recycled) box 

Navigating sustainability in Latin America’s packaging industry. 

Latin America’s packaging industry is expected to see strong growth in the coming years, fueled by an economic recovery and increased demand for packaged goods. Brazil stands out as an opportunity for growth in the packaging sector, owing to increased consumerism and foreign direct investment in Latin America’s largest economy. However, amidst these promises, supply change challenges and the potential for regulation stand out as risks to the industry.

Sustainability in the packaging industry involves numerous factors, including material selection, recyclability, reducing carbon footprint, adhering to circular economy principles and ensuring transparency. An advisor to the Congress of Colombia, specialising in environmental issues such as the plastics industry, noted, “Due to these complexities, there is no unanimous agreement on which aspect should be prioritised when discussing sustainability in this sector.”

Due to growing awareness among consumers about the environmental impact of packaging, “there is a very strong demand for sustainable products,” affirmed a university lecturer with 12 years of experience researching climate change issues related to plastics and recycling. There are also challenges associated with making sustainable options accessible without significantly increasing costs.

Opportunities for growth in the packaging sector exist, particularly at the regional level in Latin America. With an increasing number of environmentally conscious consumers willing to pay more for sustainable packaging, coupled with the growth in retail trade, “markets such as Mexico, Argentina, Chile, Colombia and Brazil” are poised for significant expansion and “we have to take advantage of it,” exclaimed the advisor to the Colombian Congress.

However, these opportunities are accompanied by regulatory challenges, including country-specific technical standards, labelling requirements and sanitary regulations. Additionally, shortages of raw materials, trained talent and rising transportation costs pose significant hurdles. “In addition to the issues associated with the increasingly demanding legal frameworks are fluctuations in the prices of the raw materials used to produce the packaging or containers, which increases the cost of production,” explained the university lecturer.

“In addition to the issues associated with the increasingly demanding legal frameworks are fluctuations in the prices of the raw materials used to produce the packaging or containers, which increases the cost of production.”

A university lecturer on plastics and recycling, Colombia

E-commerce’s exponential growth, especially post-pandemic, generates “greater demand for products, which translates into a great opportunity for the packaging industry in Latin America,” highlighted the university lecturer. While increased demand for products opens doors for growth, it also necessitates more resilient packaging to protect products during shipping. There is “greater investment in research and the purchase of technology that allows us to automate processes, create more competitive eco-designs and more strategic portfolios, with better quality and longer shelf life.” The lecturer continued, “This is key because it goes hand in hand with innovation and the ability to adapt to new needs that arise in the market.”

Anticipated regulatory changes, particularly regarding single-use plastics and sustainability, are underway. “Countries that are leading the way in the region are Brazil, Mexico and Chile.” The advisor to the Congress of the Republic expanded, “In Chile, legislation has been introduced to regulate single-use plastics, and there is also the Extended Producer Responsibility Law, which not only applies to the packaging industry, but also states that producers, or in certain cases, marketers must manage the recovery of waste generated by the industry.”

“Countries that are leading the way in the region are Brazil, Mexico and Chile … In Chile, legislation has been introduced to regulate single-use plastics, and there is also the Extended Producer Responsibility Law…”

An advisor to the Congress of Colombia

Countries like Argentina are considering bills to promote sustainable packaging and boost the circular economy. “In Costa Rica and Panama, there are also initiatives committed to protecting the seas through strategies to protect ecosystems and combat the progressive reduction of single-use plastics,” informed the university lecturer and researcher. However, enforcement of regulations remains a challenge, as witnessed in Mexico City’s uneven application of plastic bans.

Large consumer groups and distributors are adapting to increasing sustainability awareness through strategies like transitioning to more eco-friendly packaging materials, investing in renewable energies and emphasising waste management. Consumer education initiatives, such as QR codes on labels, are enhancing awareness about proper disposal methods.

“In Colombia, for example, important steps have been taken to generate strategies to improve the processes of recovery and incorporation of recovered material to create new packaging,” informed the Congress advisor. Collaborative efforts among different sectors, exemplified by Coca-Cola’s returnable bottle programme, “where this initiative has been very well received in Latin America, as well as the commitment it has made to improve infrastructure to guarantee the reuse of bottles,” confirmed the university researcher.

Latin America’s packaging industry is caught between the allure of growth and the grip of regulations, lacking a clear-cut solution. Sustainability is the buzzword, and amidst the challenges lie abundant opportunities, particularly within the burgeoning regional markets of Latin America, where a growing cohort of environmentally conscious consumers and expanding retail sectors signal promising growth prospects. However, navigating the regulatory landscape, addressing supply chain constraints and encouraging innovation remain crucial imperatives for industry stakeholders. Let’s raise our recyclable cups and toast to a packaging revolution that’s both sustainable and stylish.

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