Page 10 - Packaging News magazine July-August 2022

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INDUSTRY INSIGHT | www.packagingnews.com.au | July – August 2022
Plastics packaging: a victim of
Ahead of the K 2022 trade fair taking place in Germany in October – a
destination for Australian plastics packaging players – the organiser Texamines challenges for plastics in Europe in this insightful report.
HE European plastics industry is inflation to reach 5 per cent this year tackling challenges on multiple and stay above 2 per cent in 2023. fronts. In packaging, by far its big- “In the short to medium term, gest market, it has become a victim of Europe could potentially see a its own success, particularly as the demand contraction across polymers,” ideal material for single-use applica- predicts Martin Wiesweg, executive tions and people on the move. director Polymers EMEA at industry Just as Europe and the rest of the consultant IHS Markit.
The move to tethered caps (man- datory from 2024 under Single-Use Plastics Directive, or SUPD) and extensions of Extended Producer Responsibility (effective 2023) will have a strong influence, as does the new EU Packaging Levy on non-recycled pack- aging waste, Liebig says.
The European plastics industry is in fact having to contend with vari- ous pieces of legislation relating to plastics waste. For example, there is now a mandate that 55 per cent of all plastic packaging in the EU be recy- clable by 2030, as well as the levy on non-recycled plastic packaging waste. Some countries are also introducing local legislation (Spain and France for example), making the playing field less level than it should be.
Industry is already having to face up to some consequences of the SUPD, some elements of which came into force on 3 July 2021 in most EU countries – although the roll-out of the legislation has not been entirely smooth.
On bioplastics, the European Bioplastics trade association says: “Unfortunately, in Europe, bioplas- tics still don’t obtain the same degree of support that other innovative industries receive from EU political decision makers. The EU Commission has sometimes contradictory posi- tions on bioplastics. Member State positions on bioplastics also vary a lot, the regulatory environment is anything but harmonised.” This dis- courages investment in R&D and in production capacities, it says.
Despite these challenges, develop- ment in European bioplastics is “very positive”. Global production capaci- ties still represent less than one per cent of the more than 367 million tonnes of all plastics, but by 2026, bioplastics production will pass the two per cent mark for the first time. Production capacities for bioplas- tics in Europe were close to 600,000 tonnes in 2021 and can be expected to increase to around 1,000,000 tonnes within the next five years.
In the UK, now outside the EU, a new tax on plastic packaging came into force on 1 April and applies to plastic packaging components that do not con- tain at least 30 per cent recycled plastic
world are recovering from the devas- tating two years of the pandemic, the tragedy of the Ukraine conflict is play- ing out. The crisis is weighing heavily on the plastics sector, in terms of cost inflation, the worsening of supply chain bottlenecks, including energy supply, while also raising the spec- tre of demand shock amid the fear of global stagflation.
Inflation across the EU hit an all- time high of 7.5 per cent in March. S&P Global Economics said on March 30 that it expects eurozone growth to be 3.3 per cent this year, compared to 4.4 per cent in a previous forecast, and
PACKAGING CHALLENGES
High and escalating resin prices glob- ally means the packaging market is under continuing pressure, says Gerd Liebig, CEO of Sumitomo (SHI) Demag. “Given that recyclable granu- late is now at the same price as virgin polymer was 12 months ago, the impetus to lightweight now stretches across all packaging material sub- strates, not just virgin polymers. We continue to focus on reducing mate- rial usage by improving the process and enabling our customers to pro- duce ever thinner-walled parts.”