As consumers become more focused on environmental issues, one company is betting $600 million that paper can become the new plastic.
Graphic Packaging Holding Co. is launching a plant in Kalamazoo, Michigan, to recycle cardboard into paperboard suitable for packaging, reported The Wall Street Journal (Jan. 2). With customers including Coca-Cola, PepsiCo, Kellogg Co., and General Mills, Graphic thinks it can use the $600 million project to substantially improve environmental efforts.
Can ESG Capital Transform the Supply Chain?
Green investing has opened up a market worth more than $6 billion a year for replacing plastic with paper on store shelves, according to Graphic.
Though plastic packaging is frequently less expensive than paper, a 2021 survey by SAP and Oxford Economics found that two thirds of consumer products executives believe a sustainable supply chain is a competitive differentiator as consumers lean into the environmentally-friendly movement.
Graphic Packaging executives assert that, without substantially cleaner supply chains, their customers have little chance of meeting emissions and waste targets. With consumption and the ESG-driven push to remove plastic from supply chains, demand should also rise, according to David Einhorn, whose Greenlight Capital took a $15 million stake in Graphic.
More Developments in Green Packaging
- Tipa, an Israeli cleantech company, has raised $70 million for compostable, flexible packaging, reported CTech (Jan. 2). The company’s packaging emulates the properties of plastic in protecting food and other goods, but at its end of life, the products decompose via composting.
- Footprint, which offers plant-based solutions to help companies cut carbon emissions and landfill waste, recently agreed to go public, reported Reuters (Dec. 14).
- Mars Petcare will launch wet pet food packaging made from food-safe recycled plastic content for its SHEBA cat food brand in Europe as part of the company’s larger commitment to using more recycled content in its plastic packaging, reported Packaging Gateway (Dec. 14).