Eco-friendly packaging boom in full force as corporates race for sustainability

‘Sustainable’ or ‘eco-friendly’ packaging is not new. But now it is proliferating, and the sector is expected to boom in the coming years.

According to Grand View Research, the eco-friendly packaging market is likely to reach $353.78 billion (€312.6bn) by 2030, growing at a CAGR of 7.6% between 2025 and 2030.

While in some areas, consumer interest in sustainability is declining, in the packaging space sustainability is still thriving.

Will sustainable packaging grow? The short answer is yes, the sustainable packaging sector is predicted to grow.

The level of growth predicted by Grand View Research is “entirely achievable – if not conservative” suggests Adam M. Adamek PhD, innovation director at EIT Food.

He has already seen a dramatic growth in sustainable and eco-friendly packaging investment since 2020. “We’ve seen not only a surge in capital from both private investors and corporates, but a wholesale pivot across the industry as sustainability has moved from the margins to the mainstream.”

Even established food majors are embracing the trend, he suggests, ploughing cash into supply chain innovation, plant retrofits, and R&D.

While significant challenges remain – including costs and functionality of new materials, infrastructure for recycling and composting, and alignment on standards, certifications, and even the definition of “eco-friendly” – Adamek predicts that this growth will continue apace.

“Nearly every major food and consumer goods company now has a roadmap to transition to sustainable packaging in the next five years. Supply chain investment, material breakthroughs, and increased consumer activism are all aligning to create a market environment where exponential growth is not only possible but expected.

“The competitive landscape is now defined by who can develop solutions that are not just greener, but smarter – optimising materials, logistics, and lifecycle costs.”

Also read → In search of the most sustainable form of food packagingWhat new materials are being explored?While R&D is still very much a part of the sustainable packaging space, many of the materials used for sustainable packaging are already widespread.

One material that has become the “default alternative” is fibre-based packaging, which includes packaging made from paper, cardboard and moulded pulp. It has seen success due to both its recyclability and high levels of consumer acceptance, explains EIT’s Adamek.

Compostable bioplastics are also seeing widespread adoption, especially those made from renewable resources such as PLA and PHA.

There’s also a lot of innovation in the upcycling of food and agricultural byproducts, Which can be used for packaging instead of ending up as waste.

These days, innovation in packaging is combining the digital and the material. “What’s particularly exciting is the convergence of material science and digital technology – advanced barrier coatings and smart labelling are helping overcome technical hurdles such as shelf life and moisture resistance. Seaweed-based films, mushroom-based packaging, and hybrid multi-layer papers are quickly moving from pilot to production.”

PET plastic is also increasingly being made with biobased feedstocks, according to Packaging Europe’s Tim Sykes, making the material even more sustainable.

What’s driving the boom? “Three major forces are converging: policy, consumer demand, and corporate ESG targets‚” explains EIT’s Adamek.

On policy, EU regulations around packaging have created a “regulatory floor”, where “brands are racing to outdo each other in making public commitments around net zero and plastic reduction.”

This has meant that businesses are adopting sustainability measures more often, and what was once seen as being an “early adopter” is now standard business practice.

The EU’s recent Packaging and Packaging Waste Regulation (PPWR) is one of the most prominent pieces of legislation aiming to influence packaging in Europe. Regulating both what types of packaging are put on the EU market, and the means of packaging disposal, it changes what industry can do with packaging, and what it can’t.

Consumer pressure is also playing a key role in driving eco-friendly packaging investment. According to Adamek, the tide began to turn in this regard after the pandemic.

“The pandemic shifted people’s focus to health, safety, and environmental impact, and packaging is now a visible battleground for brands.”

Now consumers want to know how sustainable their packaging is, from carbon footprint and labelling transparency to recyclability and compostability, and are even willing to switch companies and pay a higher price to get this outcome, he explains.

“For many food and beverage companies, the packaging is becoming as important as the product itself in terms of loyalty and differentiation.”