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Packaging Our expert analysts explore how consumer preferences, the regulatory environment and megatrends are shaping the evolution of packaging across the global consumer goods marketplace.

Navigating Sustainable Packaging in Latin America

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Jorge Araya Bio
Jorge Zuniga Profile Picture
Jorge Zuniga Bio

Navigating Sustainable Packaging in Latin America

According to Euromonitor’s Product Claims and Positioning System, which tracks 15.2 million online SKUs in Latin America, only 5.6% of searched products include sustainable packaging claims. Considering fmcg industries’ scale and the vast presence of packaging in their businesses, it is essential to reflect on transitioning into circular solutions to remain relevant and competitive.

Consumers around the world are showing clear messages regarding their packaging preferences, seeking out options that are better for the environment. Greener solutions like recyclable, biodegradable and refillable are rooted in Latin American consumer minds, over Europe and North America. Yet there is still a gap between what consumers want and the available solutions companies are offering in the region, so players should prioritise sustainable packaging efforts, as is already happening in Europe, to win in Latin America.

Case studies of interest

  • Through the Pulpex consortium, Unilever is working on a paper-based detergent bottle for its brand, Omo. Made of sustainably-sourced pulp, these fully recyclable bottles will be launched in the Brazilian market in 2022. The company is piloting the same technology for hair care bottles.
  • L’Occitane is promoting the reduction of single-use plastic in the region by selling its beauty and personal care products in refill packages in the form of a pouch made from recycled plastic sourced through L’Occitane’s multi-year agreement with recycler, Loop Industries.
  • In Chile, Softys has launched the first paper-based packaging in the market via the Elite brand, breaking patterns in an industry traditionally dominated by plastic packaging.
  • Empaque Sustentable ("sustainable packaging") is a group of Chilean entrepreneurs focusing on sustainable, recyclable, biodegradable and compostable packaging solutions for delivery, made from sugar cane bagasse and a polylactic acid (PLA) alternative, and 100% plastic-free FSC-certified Kraft paper bags. Partners in Chile include Uber Eats and Justo delivery, and a wide variety of foodservice outlets.

The use of recycled content is a fast-growing trend in packaging

Bottles and jars produced using post-consumer recycled (PCR) content represent a growing trend in the packaging industry – and PET (Polyethylene terephthalate) containers are at the forefront of that trend.

In Latin America, a region with a low penetration of dishwashers, hand dishwashing is the dominant category, and a category where the plastic PET bottle is the dominant pack format. The category grew by 9% in volume terms in Argentina in 2020, and by 13% in the region.

In 2019, Unilever, the market leader in Argentina launched its Cif hand dishwashing bottle made with 100% PCR PET plastic, and in 2021 Chilean winery Viña Concha y Toro received a World Changing Ideas Award for the upcycling of its PET liner residue (a production by-product) for home care player, Viturex Ilko handwashing dish soap bottles.

Produced from fossil fuels, PET is one of the most common plastics in the world and one of the easiest to recycle, especially if transparent. The manufacturing of PET with recycled content has become a priority for brand owners to meet their sustainable packaging goals.

PET bottles can be produced with anywhere between 10% and 100% PCR content, depending on the willingness of brand owners to compromise on clarity and colour aesthetic. Colour can be addressed through additives, though not so sustainable, while some even see PCR colour as a badge of environmental honour; grey as the new green.

Building back better in soft drinks: Reuse revolutionaries

In 2019 Coca-Cola, PepsiCo and Keurig Dr Pepper announced a joint US initiative organised by the American Beverage Association to reduce plastic waste from bottles via the "Every bottle back" campaign, effectively turning a threat into an opportunity, to increase the capacity of in-demand recycled plastics, eg of rPET, to be used again as recycled content in new packaging/bottles. Is there an opportunity for bottlers in Latin America to do the same?

On re-use of the same bottle, Embol SA (distributor of The Coca-Cola Co’s portfolio in Bolivia), has aggressively promoted its 2.5-litre returnable bottle. The strategy was centred on the message “Let’s go back to something better”, referring to recovery from the pandemic and the benefit to the environment of returnable bottles.

In Brazil, Coca-Cola reports a return rate of above 90% for its universal returnable bottle initiative. The company has invested in unifying the design of their reusable PET bottles and in expanding its reuse infrastructure (bottle cleaning and refilling facilities) as part of aspiration to significantly scale up reusable packaging by 2030. The universal bottle design across all brands significantly reduces washing, filling, and costs in terms of reverse logistics.

Brazil is not alone though, as returnable bottles are a common feature across Latin America. The pandemic was also a driver in this trend. Neighbourhood small grocery retailers such as almacenes and bodegas saw increased sales due to reduced mobility and high local presence, as well as social factors encouraging consumption aimed at small business owners. Returnable bottles are popular via these channels and growth surged as a result.

imagevlouo.pngSource: Euromonitor

Plastic will continue to be a hot topic for the soft drinks industry over the forecast period. A strategy that prioritises returnable bottles will be appreciated by consumers worldwide.






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