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Nestle’s New Packaging Target Unveils Massive Plastic Problem and Infrastructure Concerns

When Nestle changed its plastic packaging goals in 2022, not many noticed. The world’s largest food company updated its website to say it would mostly use plastic “designed for” recycling by 2025, rather than only using “recyclable” or reusable packaging as originally promised. This change means 280,000 more metric tons of non-recyclable plastic waste each year, equivalent to 30 Eiffel Towers or 1,400 Statues of Liberty in weight, according to 2022 data.

Struggling with Plastic Reduction Goals

This shift highlights the struggle to reduce virgin plastic use, a goal set by many companies since 2018. These companies are now finding it hard to keep their promises due to rising raw material costs and pressures to prioritize profitability over environmental concerns. “If big companies with vast resources can’t meet their commitments, there’s clearly a problem,” said Christina Dixon from the Environmental Investigation Agency.

Nestle’s Explanation

Nestle, known for products like Nespresso pods and Maggi Stock cubes, said it changed the wording to reflect what it could realistically control. A spokesperson stated that achieving 100% reusable or recyclable packaging by 2025 was unrealistic due to infrastructure barriers. In 2022, only 51% of Nestle’s packaging was recyclable, reusable, or compostable, down from 55% in 2018. However, they expect this to rise to 63% in 2023. With the new goal of packaging “designed for” recycling, Nestle claims 83.5% of its plastic packaging met this criterion in 2023.

Global Plastic Waste Problem

Globally, 400 million tons of plastic waste are produced every year. The United Nations warns that if current trends continue, this could rise to 1.1 billion tons by 2050. With less than 10% of plastic recycled worldwide, ambitious promises are becoming increasingly difficult to achieve. Insufficient recycling infrastructure, inadequate regulation, and consumer habits are often blamed for these challenges.

Need for Systemic Changes

Critics argue that companies need to stop using packaging that can’t be easily recycled, such as multilayered plastic sachets. Sander Defruyt from the Ellen MacArthur Foundation emphasized the need for industry-wide investments in innovation to move towards more recyclable solutions.

Recycling Infrastructure Challenges

Recycling is technically complex and expensive. In London, a recycling facility processes around 120,000 tons of waste a year. However, less than 50% of household packaging gets recycled in the UK, similar to the rest of Europe. Veolia, which operates the plant, says there’s no market for certain plastics, making investments in new facilities risky.

Cost of Virgin vs. Recycled Plastics

Recycled plastics often cost more than virgin plastics. For example, recycled PET can be €200 more per ton than new PET. This price difference is partly due to EU regulations requiring a certain percentage of recycled content in PET bottles by 2025.

Future of Plastic Recycling

The supply of virgin plastics is expected to increase as petrochemical companies look to offset declines in fossil fuel demand. For recycled plastic to become the default, it needs to be cheaper than virgin plastic.

Complex Packaging Issues

Many consumer goods companies use complex packaging that isn’t easily recyclable. For instance, over 17% of Nestle’s plastic packaging in 2022 was multilayered sachets and pouches, which are not recycled at scale. Companies are hoping for advancements in technology and recycling infrastructure to meet their sustainability goals.

Innovative Solutions

Some startups are exploring biological solutions, like Carbios in France, which uses enzymes to break down plastic. However, these technologies won’t be available at scale until at least 2026. Local governments, often the poorest in the chain, are burdened with managing plastic waste without adequate resources or infrastructure.

Nestle’s struggle with its plastic reduction goals reflects a broader issue in the industry. Achieving significant reductions in plastic waste will require systemic changes, including improved recycling infrastructure, innovative technologies, and stronger regulatory frameworks.

Disclaimer: The views and investment tips expressed by investment experts on Sharepriceindia.com are their own and not those of the website or its management. Sharepriceindia.com advises users to check with certified experts before taking any investment decisions.​​

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