Scandinavia: Packaging Industry Banks on Wood

With Tetra Pak, UPM-Kymmene, Stora Enso, Smurfit Kappa and Huhtamaki, some of the largest packaging manufacturers in Europe and the world are based in Scandinavia. Almost all of them have historical roots in the use of wood fibre. No wonder, since a large part of the region is covered with forests. Fibre-based packaging is therefore still the most important pillar of the industry in Sweden, Finland and Norway.

A Look at Sweden

With more than 604,000 tonnes, paper packaging was the most common type of packaging in Sweden in 2020. Plastic packaging including PET bottles accounted for 248,800 tonnes, glass 233,000 tonnes, wood 207,800 tonnes and aluminium deposit cans 23,500 tonnes. Of this, about 60.2 percent was recycled. This puts the recycling rate below the EU average of 64.3 percent. However, the recycling rates differ greatly for individual materials. For example, 94 per cent of the glass packaging placed on the market in Sweden was recycled. For fibre-based packaging, the figure is around 80 percent. 

The recycling rates in this area are mainly due to the producer responsibility obligations that apply in Sweden. It places the responsibility for the collection and treatment of their products at the end of their life cycle on the producers. This also means that they are responsible for developing products that are more resource-efficient, recyclable and do not contain environmentally hazardous or harmful substances. For this reason, the country has one of the most advanced collection and recycling systems.

In early July 2022, the government in Stockholm published a new regulation on producer responsibility for packaging. When foreign companies import their products into the Swedish scope or sell their products to Swedish consumers, the new Producer Responsibility Regulation for Packaging also applies to them. All packaging producers are obliged to join an approved PRO (Producer Responsibility Organisation). PROs take responsibility for the collection, sorting and recycling of packaging producers' waste. Already since 2021 they have to register with the Swedish Environmental Protection Agency (Naturvårdsverket), which includes an annual reporting obligation to the agency.

The Finnish Packaging Industry

Three quarters of Finland's land area is forested, which is why the Finnish wood industry has combined long-standing traditions of forestry with uses such as the packaging industry. According to the government organisation Business Finland, 69 per cent of Finland's packaging exports are various fibre-based materials. The country is also planning several new refineries and factories to utilise the renewable raw material. It is therefore not surprising that Finland is a major producer of paper, cardboard and cartons, which are used for a number of consumer goods.

Besides the production of virgin material, the country has also specialised in recycling. The market environment, based on close cooperation between companies, research and the public sector, has built up a close-knit infrastructure of recycling processes and bio-based solutions for pulp and wood fibres. The country has a recycling rate of 98 percent for paper and cardboard, but only 26 percent for plastics. Overall, 68.5 percent of packaging waste was recycled.

Despite the politically intended march away from plastics, they still have an important place in the Finnish packaging industry: analysts expect imports of plastic packaging in Finland to reach a value of 236 million euros by 2026, an increase of 0.9 per cent compared to 2021 (225 million euros). Exports of Finnish plastic packaging are forecast to remain stable at around 73 million euros from 2021 to 2026. Sales of plastic packaging are forecast to shrink by 0.8 percent by 2026 compared to 2021, with a value of 334 million euros (352 million euros in 2021).

Norwegian Deposit System as a Model

Paper and cardboard packaging is also widespread in Norway and the country has set up an exemplary recycling system for it. For the total packaging volume, the recycling rate for packaging waste was around 52.5 percent in 2020. This represents a slight decrease compared to 2010, when the recycling rate for packaging waste in the Nordic country reached almost 57 percent.

Norway's deposit system, which is considered a global model for the return and recycling of beverage packaging, is one of the most efficient in the world. Norway was one of the first countries in the world to introduce a deposit system for returnable bottles. A system for refillable glass containers was established as early as 1902 and the automatic return of glass bottles to reverse vending machines came in the early 1970s.

The deposit system for non-refillable beverage containers is unique in that it was introduced on a voluntary basis by the beverage and food retail industry. It became mandatory in 1999 as part of an environmental tax. According to Infinitum's annual report for 2021, more than 1.55 billion beverage containers were returned for recycling – Infinitum owns and manages the Norwegian deposit return system.

The EU has set a 2029 target for member countries to recycle at least 90 percent of plastic bottles. Norway is already several years ahead of this thanks to its proven deposit system with a recycling rate of 97 percent.