Fiber Packaging

The global pulp and paper industry uses around 40 percent of all wood harvested for industrial use. In some regions, expansion of harvesting and production of pulpwood threatens forests, increasing biodiversity losses, social conflict, water pollution, and greenhouse gas emissions.

This brief provides a summary of the main environmental and social factors that affect the production of fiber-based packaging made from virgin pulpwood; while its focus is global, it spotlights key players in the U.S. value chain and provides examples of actions being taken by companies operating or headquartered in the U.S.

KEY TAKEAWAYS

In some regions, expansion of harvesting and production of the pulpwood used to produce packaging threatens forests and their communities. Impacts include loss of biodiversity, social conflict, water pollution and greenhouse gas emissions.
Companies are reducing risks by ensuring pulpwood is sourced from verified legal sources and sustainable forest operations, increasing the recycled content of their products and ensuring clean production.
Investors should address business risks through direct engagement with their portfolio companies and by supporting relevant policies and multi-stakeholder collaborations.
Fiber-based packaging is made from a renewable material and is technically recyclable. However, all the impacts across a product’s and package’s supply chain should be considered when making packaging decisions as there are tradeoffs among different types of packaging materials.

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Environmental and Social Factors that Drive Risks

Climate Change
Deforestation and Land Use Change
Soil Health and Biodiversity
Land Rights
Water Use and Pollution
Working Conditions

Climate Change

high

GHGs are emitted throughout the lifecycle of fiber-based packaging, from forest extraction, to pulp and paper production, to use and disposal. The fiber packaging industry has exposure to deforestation risk, which is a source of greenhouse gas emissions. Good forestry practices can help maintain standing forests, which is important to reducing emissions and mitigating climate change.
Deforestation and Land Use Change

high

Wood harvested illegally is a legal and reputational risk
Although the use of recycled fiber is slowly increasing, the paperboard industry's primary source of fiber is still forests and tree plantations.
Soil Health and Biodiversity

high

Irresponsible wood harvesting and management contribute to biodiversity loss and soil erosion
Irresponsible harvesting from natural forests, as well as establishment of pulpwood plantations on converted natural habitats, can threaten fragile ecosystems and species and cause soil erosion. Moreover, since tree plantations are typically monocultures of non-native tree species with only a fraction of the plant and animal species found in natural ecosystems, there is a significant loss in biodiversity.
Land Rights

medium

Unsustainable forest management can displace communities
In regions where property rights are unclear or not enforced, indigenous peoples and local communities may be wrongfully displaced during the acquisition of land or conversion of forests.
Water Use and Pollution

medium

Pulp mills contribute to water pollution, damaging ecosystems and the health of surrounding communities
The manufacturing of fiber-based packaging uses a substantial amount of water (one reason why mills are located near waterways) and can produce large quantities of wastewater. Historically, the pulp mill industry has been one of the largest producers of water pollution, as these facilities used chlorine to bleach the wood pulp to produce white paper.
Working Conditions

low

Fiber-based packaging production has not been a major driver of working condition concern.

Commodity Background

Boxboard made with primarily virgin wood pulp is often used for beverage cartons, frozen food packaging and candy boxes. Boxboard may be made with a high proportion of recycled content, which is typically used as packaging for dry foods such as cookies and crackers, cereal and cake mixes.

Top Production Regions

China and the U.S. are by far the largest producers of wrapping, packaging paper

and paperboard, accounting for nearly half of global production.

Production Statistics, Trends, and Drivers of Demand

213 million metric tons:
Average global production, 2011 - 2013

$261 billion:
Global production value

22 percent:
Proportion of global production exported

Supply Chain

The largest US suppliers of fiber-based packaging represent a significant share of the market.

Based on tonnes of paper and board produced in 2014, the three largest publicly traded U.S.-based companies were:

• International Paper (22.5 million tonnes)

• West Rock (10.9 million tonnes)

• Packaging Corporation of America (4.3 million tonnes)

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Company Examples

International Paper

International Paper has committed by 2020 to a 35 percent increase in third-party certified fiber volume. With respect to water quality, it set a goal to reduce mill wastewater discharges of oxygen-depleting substances (BOD) by 15 percent by 2020.

Mars

Mars has committed to use certified, verified or recycled sources for 100 percent of its pulp and paper-based packaging by the end of 2020.

McDonald’s

McDonald’s set a goal, by 2020, to use certified or recycled sources for 100 percent of its fiber-based packaging (such as hot cups, carry out bags and clamshells). Its approach focuses on optimizing product design, increasing the use of recycled or certified raw materials, and encouraging use of packaging with viable end-of-life options.

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