Upcycled Materials in Packaging Market Ramps Up in 2025 with ESG Goals and Regulatory Support

According to Towards Packaging consultants, the global upcycled materials in packaging market is expected to witness significant growth during the forecast period from 2025 to 2034. Driven by evolving industry trends, increasing demand, and technological advancements, the market is projected to expand at a steady pace, highlighting its rising importance across various sectors worldwide.

Ottawa, July 03, 2025 (GLOBE NEWSWIRE) -- The global upcycled materials in packaging market size is anticipated to experience robust growth between 2025 and 2034, according to a study published by Towards Packaging, a sister firm of Precedence Research. The market is expected to expand steadily over the forecast period, driven by increasing demand and emerging industry trends.

Upcycled Materials in Packaging Market

The market is driven by rising environmental awareness, stringent regulations, and evolving consumer preferences. It leverages waste sources like plastics, paper, agricultural residues, textile scraps, and food by‑products to create durable packaging that maintains or enhances material value. Innovations in bio‑binders, biopolymers, and fiber technologies are unlocking new applications across cartons, bags, pouches, and molded trays. Major adoption occurs in food and beverage and e‑commerce, supported by AI‑driven material selection, carbon footprint analytics, and global policy incentives promoting circular economy practices.

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What is Upcycled Packaging?

Upcycled materials in packaging refer to waste or discarded materials that are creatively reused to make packaging products with equal or higher value than the original material. Unlike recycling, which often breaks materials down into lower-quality forms, upcycling retains or enhances material quality and functionality. Examples include turning textile scraps into packaging liners, using agricultural waste (like sugarcane fiber) to make containers, and reusing plastic waste to form durable shipping pouches. Upcycled packaging supports sustainability and reduces landfill waste.

Brands are integrating environmental, social, and governance (ESG) commitments, pushing for reduced carbon footprints and sustainable sourcing. Consumers and companies are increasingly prioritizing sustainability, leading to demand for eco-friendly packaging alternatives. Policies banning single-use plastics and promoting circular economy practices encourage businesses to adopt upcycled materials. Turning waste into packaging materials lowers raw material costs and adds value to previously discarded resources. Advances in biopolymers, bio-binders, and fiber technologies enable more efficient and scalable upcycling processes. Shoppers prefer brands that clearly communicate sustainable practices, including packaging sourced from upcycled materials.

What Are the Trends in the Upcycled Materials in Packaging Market?

• Integration with smart tech
  

Embedding QR codes, NFC tags, sensors, and IoT to drive transparency, traceability, and end‑of‑life instructions.

• Circular and refillable systems
  

Increasing adoption of refill stations, reuse programs, and bulk‑buying formats to minimize waste.

• Biomaterial innovations
  

Using seaweed, mycelium, agricultural residues, and ocean plastics to create compostable and edible packaging.

• Minimalist and mono‑material desig
  

Reducing layers and combining recyclable materials for improved recycling efficiency.

• Collaboration across supply chains
  

Brands, NGOs, and suppliers are working together on upcycling efforts and circular economy models.

What are the Potential Growth Opportunities in the Upcycled Materials in Packaging Market?

• Corporate ESG goals
  

Corporate ESG (Environmental, Social, and Governance) goals related to using upcycled materials in packaging are part of broader sustainability strategies aimed at reducing environmental impact, promoting circular economy principles, and meeting stakeholder expectations. These goals typically fall under the Environmental pillar of ESG but also support Social and Governance aspects.

• Waste reduction and circular economy
  

Minimize landfill waste and raw material extraction by using post-consumer or post-industrial materials. Upcycling discarded materials (e.g., plastics, textiles, agricultural waste) into packaging products. Reduces resource consumption, carbon footprint, and pollution.

• Sustainable packaging targets
  

Replace a percentage of virgin materials with upcycled content. Companies like Unilever, Nestlé, and Coca-Cola commit to using 25–50% recycled or upcycled content in packaging by 2025–2030. Enhances brand sustainability profile and meets consumer and regulatory demands.

• Carbon emission reduction
  

Lower carbon emissions across the product life cycle. Upcycled materials generally require less energy to process than virgin ones, helping companies meet Scope 3 emission reduction targets. Supports science-based targets for climate action (SBTi).

• Ethical sourcing and community engagement
  

Support fair labor and community-driven recycling initiatives. Partner with informal waste collectors or local upcycling enterprises in developing regions. Generates social value while reducing environmental harm.

• Regulatory compliance and reporting
  

Comply with packaging regulations like the EU Packaging and Packaging Waste Regulation, Extended Producer Responsibility (EPR) laws, and plastic taxes. Use of upcycled materials often helps meet recycled content thresholds or earn sustainability certifications (e.g., FSC, Cradle to Cradle). Reduces compliance risk and enhances ESG scores and investor confidence.

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Companies with ESG Goals Involving Upcycled Packaging:

Unilever:

Committed to using 100% recyclable, reusable, or compostable plastic packaging by 2025. In January 2025, Unilever, a global consumer goods company, revealed the company's near-term goals, which include reducing the use of virgin plastic by 30% by 2026 and 40% by 2028. A drop of 23% from 2019 the Unilever aims to have all of its plastic packaging recyclable, reusable, or compostable by 2030 for rigid and 2035 for flexibles. The companies aim to manufacture packaging that is recyclable, reusable, or biodegradable in 57% of cases (76% of rigid and 13% of flexible). The Unilever company has implemented to use 25% recycled plastic by 2025.

Nestlé:

Nestlé is actively transitioning to sustainable packaging, aiming for 100% of its packaging to be recyclable or reusable by 2025. The company is incorporating upcycled materials, such as using coffee by-products in its Guoran Light Coffee packaging in China, and adopting 100% recycled PET (rPET) bottles in markets like Spain. Iconic brands including Smarties, Nesquik, KitKat, and Maggi have moved to recyclable paper packaging, while refill and reuse pilot programs are being tested. Nestlé has invested over $30 million in recycled plastics and circular economy systems and is involved in more than 220 global initiatives aimed at strengthening recycling and waste management infrastructure.

Patagonia:

Patagonia is advancing sustainable packaging by embracing upcycled and non-tree-based materials, notably through its partnership with Canopy’s Pack4Good initiative. Since September 2024, the brand has committed to eliminating packaging sourced from endangered forests—such as delivery boxes, hang tags, and shoeboxes by shifting to alternatives like agricultural waste fibers and recycled paper, ensuring none of its packaging contributes to deforestation.

L’Oréal:

Under its “L’Oréal for the Future” initiative, the company aims to ensure that 100% of plastic packaging is reusable, refillable, recyclable, or compostable by 2025, with a target of 100% recycled or bio-based plastic materials by 2030. To support this, L’Oréal is partnering with innovators like Carbios on enzymatic PET recycling, launching the first 100% recycled PET cosmetic bottles under its Biotherm brand in 2025. It also introduced hybrid paper–plastic tubes (e.g., Garnier, La Roche-Posay, Vichy) that reduce plastic usage by up to ~50%.

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Which Region Held the Dominating Share of the Upcycled Materials in Packaging Market?

Europe dominates the upcycled packaging market due to a strong convergence of regulations, consumer behaviour, infrastructure, and innovation. The European Union’s Green Deal, Circular Economy Action Plan, and Single-Use Plastics Directive impose strict sustainability targets, compelling businesses to adopt upcycled materials. National regulations, such as plastic bans and deposit-return schemes in countries like France and the Nordics, further reinforce this shift. European consumers are among the most eco-conscious globally, with a large percentage prioritizing environmentally friendly packaging and showing a willingness to pay more for it.

Europe boasts advanced recycling infrastructure, with countries like Germany and Belgium achieving over 70–80% recycling rates for packaging waste. Large FMCG companies operating in Europe—such as Unilever, Nestlé, and IKEA—are pledging to increase upcycled content in their packaging, while startups and innovation hubs across the continent develop cutting-edge, sustainable materials and solutions. Certifications like Cradle to Cradle and EU Ecolabel also support market credibility. Lastly, the rise of e-commerce in Europe drives demand for lightweight, recyclable, and sustainable packaging options, reinforcing the region’s leadership in the upcycled packaging landscape.

Why did Asia Pacific Witness an Opportunistic Rise in Upcycled Materials in Packaging Market?

Asia Pacific is the fastest‑growing region in the upcycled materials in packaging market due to surging urbanization, a rising middle class with greater disposable incomes, and shifting consumer preferences toward eco‑friendly packaging. Government regulations banning single‑use plastics in major markets like China and India are spurring corporate adoption of recycled and biodegradable materials. Rapid e‑commerce growth across the region further drives lightweight, sustainable solutions, all supported by investments in recycling infrastructure and innovation hubs.

China Market Trends

China leads the region due to strict environmental policies like the ban on non-degradable plastic bags and growing government investment in recycling systems. Its booming e-commerce sector and increasing consumer awareness about sustainability are encouraging the use of upcycled and recycled packaging across food, retail, and logistics industries.

India Market Trends

India is witnessing rapid growth driven by nationwide bans on single-use plastics, a large consumer base, and the rise of eco-conscious startups. Government schemes like “Swachh Bharat Abhiyan” and producer responsibility norms are pushing companies to adopt upcycled materials in packaging, especially in the FMCG and food sectors.

Japan Market Trends

Japan's mature recycling infrastructure and strong consumer commitment to environmental responsibility support the upcycled packaging market. Leading companies are innovating in biodegradable and recycled-content packaging to align with national circular economy goals and reduce plastic waste, particularly in food and cosmetics packaging.

South Korea Market Trends

South Korea has robust recycling laws and aggressive sustainability goals under its Green New Deal. Consumers are highly informed and favor eco-labeled products, prompting manufacturers to invest in upcycled and recyclable packaging formats, especially in electronics and personal care sectors.

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How is the Growth of the North American Upcycled Materials in Packaging Market?

North America is witnessing notable growth in the upcycled materials in packaging market due to a combination of regulatory, industrial, and consumer-driven factors. Several U.S. states and Canadian provinces have implemented extended producer responsibility (EPR) laws, plastic bans, and recycled-content mandates, pushing companies toward sustainable and upcycled packaging solutions. The region's strong food, beverage, and e-commerce sectors create consistent demand for eco-friendly secondary packaging like corrugated boxes and molded-fiber materials.

Major corporations such as Walmart, PepsiCo, and Unilever have committed to using 100% recyclable or compostable packaging by 2025–2030, accelerating the shift toward upcycled alternatives. In addition, North America leads in innovation, with advancements in bioplastics, plant-based polymers, and AI-based sorting systems enhancing the viability and scalability of upcycled materials. A growing base of eco-conscious consumers, particularly among Gen Z, is also fueling this trend, as over 80% express willingness to pay more for sustainable packaging options.

U.S. Market Trends

The U.S. leads the North American upcycled materials in packaging market with strong momentum driven by state-level policies such as plastic bans, mandatory recycled content laws (e.g., in California and Washington), and growing producer responsibility schemes. The country’s vast e-commerce market, led by Amazon and Walmart, is pushing demand for sustainable, lightweight, and upcycled packaging. Additionally, U.S. consumers show strong eco-conscious behavior, and brands are investing in R&D for upcycled materials, particularly in food, personal care, and logistics packaging sectors.

Canada Market Trends

Canada is experiencing rapid growth due to federal and provincial commitments to eliminate plastic waste by 2030. The country’s “Zero Plastic Waste” initiative, combined with extended producer responsibility (EPR) regulations in provinces like British Columbia and Ontario, is pushing companies to use upcycled and post-consumer recycled materials. Canadian consumers are highly supportive of eco-friendly packaging, and domestic packaging companies are actively investing in circular economy solutions using paper, cardboard, and plant-based alternatives.

How Crucial is the Role of Latin America in Upcycled Materials in Packaging?

Latin America is experiencing considerable growth in the market due to a mix of economic, regulatory, and consumer-driven factors. The region's booming e-commerce sector and rapid urbanization are increasing demand for lightweight, protective, and cost-effective packaging, creating strong opportunities for upcycled materials like recycled paper and flexible films. Consumers across Latin America are becoming more eco-conscious, encouraging brands to adopt recyclable and biodegradable packaging, especially in the food, personal care, and household product segments.

Governments in countries like Brazil, Mexico, and Chile are implementing plastic bans and circular economy initiatives that drive companies to invest in sustainable and upcycled packaging. In parallel, infrastructure and innovation are improving, with major players like Coca-Cola investing in PET recycling plants and companies expanding R&D in bioplastics and post-consumer recycled (PCR) materials. Additionally, flexible and paper-based packaging formats are gaining popularity due to their lower environmental footprint, recyclability, and adaptability, supporting the region’s ongoing shift toward greener packaging solutions.

Mexico Market Trends

Mexico’s upcycled materials in packaging market is growing steadily, driven by rising urbanization, export-focused industries, and increasing pressure to align with North American trade and environmental standards. While regulatory enforcement varies by state, there is growing interest among food exporters and manufacturers to adopt recyclable and upcycled materials to meet U.S. and EU compliance. Domestic awareness is rising, and more companies are investing in biodegradable and recycled packaging for both domestic consumption and international trade.

Middle East and Africa Witnesses Steady Growth

The Middle East and Africa (MEA) is experiencing considerable growth in the upcycled materials in packaging market, supported by a combination of regulatory action, consumer trends, and industry shifts. Governments in countries like the UAE, Saudi Arabia, and South Africa are implementing bans on single-use plastics and introducing recycled-content mandates and circular economy goals, aligned with broader sustainability visions such as Saudi Arabia’s Vision 2030. At the same time, environmental awareness among consumers is rising, driving demand for biodegradable, recyclable, and upcycled packaging especially in the food and personal care sectors.

MEA’s growing e-commerce and urbanization, particularly in nations like the UAE, Nigeria, and South Africa, also boost demand for secure and sustainable packaging materials such as corrugated boxes and flexible mailers. Additionally, investments in recycling infrastructure are increasing, with companies like Hotpack in Saudi Arabia expanding their sustainable production capabilities. The booming food and beverage industry, including the export of chilled and processed foods, further supports the need for intelligent, eco-friendly, and upcycled packaging that enhances product shelf life and safety.

More Insights of Towards Packaging:

• Reusable Water Bottles Market : https://www.towardspackaging.com/insights/reusable-water-bottles-market-sizing
• Recycled Polypropylene in Packaging Market : https://www.towardspackaging.com/insights/recycled-polypropylene-in-packaging-market-sizing
• Recycled Polyethylene Terephthalate Market : https://www.towardspackaging.com/insights/recycled-polyethylene-terephthalate-market-sizing
• Post-Consumer Recycled Plastic Market : https://www.towardspackaging.com/insights/post-consumer-recycled-plastic-market-sizing
• Uncoated Recycled Paperboard Market : https://www.towardspackaging.com/insights/uncoated-recycled-paperboard-market-sizing
• Recycled PET Bottles Market : https://www.towardspackaging.com/insights/recycled-pet-bottles-market-sizing
• Recycle Ready Retort Pouches Market : https://www.towardspackaging.com/insights/recycle-ready-retort-pouches-market-sizing
• Recycled Glass Market : https://www.towardspackaging.com/insights/recycled-glass-market-sizing
• Recycled Aluminum Cans Market : https://www.towardspackaging.com/insights/recycled-aluminum-cans-market-sizing
• Corrugated Fanfold Market : https://www.towardspackaging.com/insights/corrugated-fanfold-market-sizing

Segment Outlook

Material Type Insights

The plastic material type segment is dominant in the market due to its widespread availability, cost-effectiveness, and recyclability. Large volumes of post-consumer and industrial plastic waste provide abundant raw materials for upcycling. Advances in recycling technologies enable the efficient conversion of used plastics into durable, high-quality packaging. Additionally, plastic’s lightweight, flexible, and protective properties make it ideal for food, personal care, and e-commerce packaging. Growing corporate commitments to reduce virgin plastic use and meet sustainability targets further boost demand for upcycled plastic packaging across industries.

The paper material type segment is projected to grow at the fastest rate in the market due to its strong environmental advantages, regulatory backing, and technological innovations. Paper is highly recyclable reusable up to 5-7 times and decomposes naturally, offering a significantly lower carbon footprint than virgin materials. Demand is escalating in food and beverage, e-commerce, and retail packaging, with paper bags and sacks growing at a projected 6.1% CAGR thanks to improved fiber processing and plastic bans. Its lightweight nature, versatility, and cost-effective recyclability position paper as the primary growth driver in the market.

Packaging Form Insights

The boxes and cartons packaging segment, which includes corrugated boxes, folding cartons, and stand-up cartons, dominates the market due to its structural strength, universal use, and well-established recycling ecosystem. These packaging formats are widely utilized in e-commerce, food and beverage, pharmaceuticals, electronics, and consumer goods, making them ideal for upcycled paperboard and cardboard.

Their robustness ensures reliable protection during shipping, while their surfaces support high-quality printing and brand customization, increasing consumer appeal. Additionally, mature collection, sorting, and mechanical recycling systems provide a steady raw-material supply, and the ability to reuse fibers 5–7 times enhances cost efficiency and environmental credentials. These factors combine to make boxes and cartons the leading format in upcycled packaging.

The paper bags and snacks packaging segment is growing at the fastest rate in the upcycled materials in packaging market due to rising environmental regulations and growing consumer preference for eco-friendly alternatives to plastic. Government bans on single-use plastics and heightened awareness of sustainability have driven demand for biodegradable and recyclable paper-based packaging.

The boom in e-commerce and food delivery services has further accelerated the use of durable, lightweight, and customizable paper bags for snack products. Technological advancements in fiber processing have improved the strength, moisture resistance, and printability of paper, making it increasingly suitable for snacks and fast-moving consumer goods. Additionally, paper’s ability to be recycled multiple times supports circular economy goals and corporate ESG targets, reinforcing its appeal in the sustainable packaging landscape.

End-Use Industry Insights

The food and beverages end-use segment is dominant in the market due to the sector’s high packaging volume and growing emphasis on sustainability. With increasing consumer demand for eco-friendly and safe packaging, brands are adopting upcycled materials like recycled paper, bioplastics, and post-consumer resins to package snacks, beverages, and ready-to-eat meals.

Regulatory pressures to reduce plastic waste and enhance recyclability further drive this shift. Additionally, upcycled packaging helps extend shelf life, maintain hygiene, and support brand image, making it ideal for food and beverage applications.

The agriculture-induced segment is growing fastest in the market by transforming readily available farming by-products such as rice husks, straw, sugarcane bagasse, coconut husks, and corn stalks into biodegradable packaging (e.g., molded trays, fiberboard, films). This approach reduces agricultural waste and supports circular economies.

Innovations in material science, like bio-binders and biopolymers, enhance performance and aesthetics, meeting food-grade standards. Additionally, rising demand for compostable, renewable packaging and supportive research funding drive rapid adoption and market expansion.

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Recent Breakthroughs in Global Upcycled Materials in Packaging Market:

• In May 2025, Burts revealed that their company is using 55% recycled plastic in its new packaging for their crisp packs. Burts will be introducing the new packaging in June 2025 for a range of its favourite flavours and pack sizes of 40 g and 150 g. The eco-friendly packets are made from recycled post-consumer (PCR) material and include well-known flavors like Devon Roast Beef, Lightly Sea Salted, Mature Cheddar and Onion, and Sea Salt.
• In May 2025, Governor Glenn Youngkin announced that Green Recycle USA LLC, a start-up company that will process and recycle industrial plastic waste, will invest USD 4.3 million to open in an existing building in Pittsylvania County. The company wants to produce a more sustainable solution for plastic trash and reduce the amount of industrial plastic waste that is disposed of in landfills. The project is expected to generate 28 new job opportunities.

Global Upcycled Materials in Packaging Market Players

• Amcor Plc
• Mondi Group
• Berry Global Inc.
• Smurfit Kappa
• Ball Corporation
• Mauser Packaging Solutions
• WestRock Company
• Schütz GmbH and Co. KGaA
• International Paper
• Huhtamaki Inc.
• Tetra Pak
• SIG Group
• ALLTUB GROUP
• Albéa Group
• Stora Enso
• AptarGroup, Inc.
• Silgan Holdings Inc.
• Sealed Air Corporation
• DS Smith
• Crown Holdings, Inc.

Segments Covered in the Market

By Material Type

• Plastic
• Paper
• Glass
• Metal
• Textile
• Others

By Packaging Form

• Boxes and Cartons
• Paper Bags and Sacks
• Bottles
• Pouches
• Wrappers
• Trays

By End-Use Industry

• Food and Beverage
• Agriculture
• Personal Care and Cosmetics
• Pharmaceuticals
• Industrial
• Household Products
• E-commerce
  

By Region

• North America
  • U.S.
  • Canada
• Europe
  • Germany
  • UK
  • France
  • Italy
  • Spain
  • Sweden
  • Denmark
  • Norway
• Asia Pacific
  • China
  • Japan
  • India
  • South Korea
  • Thailand
• Latin America
  • Brazil
  • Mexico
  • Argentina
  • South Africa
• Middle East and Africa (MEA)
  • UAE
  • Saudi Arabia
  • Kuwait
    

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