Understanding the Next Decade of End Markets for Flexible Packaging Derived PCR

The report looks at the secondary applications that will be needed if Europe is going to meet the Packaging and Packaging Waste Regulation (PPWR) targets for recycled content in 2030 and recycling at scale in 2035.

It examines how demand for flexible packaging derived post-consumer recyclate (PCR) could develop, which applications may be able to use that material, and how quality requirements influence where different grades of recyclate can realistically go.

The first message is the scale of the 2030 recycled content requirement. In our 2025 baseline, Europe uses a conservatively estimated 1.5 million tonnes of polyolefin flexible packaging PCR each year. By 2030, our analysis suggests that around 2.5 million tonnes of flexible packaging derived PCR will be required to deliver PPWR recycled content targets in flexible packaging alone.

That is the immediate regulatory challenge. Plastic packaging placed on the EU market will need to contain minimum levels of recycled content, and those targets create a direct pull for PCR in packaging applications.

The second message is that the system cannot stop there. CEFLEX analysis identifies around 4.3 million tonnes of existing and potential demand for flexible packaging derived PCR in 2030, coming from a broader set of established secondary markets that already use, and could absorb more, recycled content. These include construction films, refuse sacks, transport packaging, horticulture products and other rigid applications.

Many of these wider markets are not driven directly by PPWR and depend on quality, supply, price and technical compatibility. If PCR does not meet those conditions, users will revert to virgin material – with a negative impact on circular material and recycling rates as a result.

The third message is about 2035. The 55% recycled-at-scale recycling rate target effectively makes finding meaningful secondary applications for 5.9 million tonnes of flexible packaging derived PCR a requirement. At that point, the question is not only whether flexible packaging can be collected and recycled, but whether the material produced can be used again in real applications at sufficient scale.

That is why the report also argues for end markets to develop ahead of the regulatory deadlines. Waiting until the targets are already in force to scale demand and investment would create bottlenecks across the system.

Packaging applications remain essential because they drive recycled content demand and regulatory compliance. But packaging alone is unlikely to absorb all the recycled material expected to be produced as recycling volumes increase towards 2035.

Part of the reason is that packaging applications are very different from one another, both technically and from a regulatory perspective. Some packaging is contact-sensitive, such as food, cosmetics or pharmaceutical packaging, where stricter requirements apply. Other applications are non-contact-sensitive, such as transport films or heavy-duty sacks.

From 2030 onwards, PPWR recycled content obligations create strong demand for higher-quality recycled material. At the same time, if recycling rates increase as intended, Europe will also be producing much larger overall volumes of recycled flexible packaging material, and not all of it will have the same characteristics or quality.

Some recyclate will be suitable for higher-specification packaging uses. Other material will be better suited to non-packaging applications, including construction films, storage products, pallets, crates, horticulture products and other rigid goods.

That is why non-packaging applications become increasingly important. They can absorb broader grades and larger overall volumes of recycled material, helping higher recycling rates translate into more recycled material replacing virgin resources.

Quality influences almost everything downstream: where recycled material can be used, how much recycled content an application can realistically incorporate, and whether there is a stable market for the material produced.

Recycled flexible packaging material quality is shaped by how packaging was designed, what was originally placed on the market, how it was collected, how accurately it was sorted, and how effectively it was recycled afterwards.

As more household flexible packaging enters collection and recycling systems towards 2035, the range of material qualities entering the market is also likely to become more diverse. That is positive from a recycling-rate perspective, but it increases the importance of matching recyclate quality to suitable secondary applications.

This is one reason why design for recycling continues to matter. Material choices, inks, adhesives, barriers, labels and pack format can all influence sorting and recycling outcomes, and therefore the quality of recyclate produced afterwards.

The same applies to sorting and recycling technologies and infrastructure. Improvements in film sorting, near-infrared detection, quality control and recycling processes can all help produce higher quality, more consistent material streams capable of reaching higher-value applications.

Much of the challenge comes down to alignment: producing the right quality of material for the applications that can use it, in the quantities the market needs.

One of the main findings is that future demand is not spread evenly across hundreds of applications. A relatively small number of end markets account for a very large share of potential recycled material demand.

For polyethylene, particularly flexible PE films, several large-volume applications stand out. Stretch film, shrink film, refuse sacks, heavy-duty sacks and other PE bag applications combine large market demand with realistic technical opportunities for recycled content uptake. These applications matter because they can absorb substantial material volumes when the right quality, supply and commercial conditions are in place.

Polypropylene follows a different pathway. Around 80% of PP flexible packaging is currently used in contact-sensitive applications. In practice, that limits how much mechanically recycled PP can flow directly back into equivalent flexible packaging uses, especially where food-contact or similar requirements apply.

As a result, recycled PP from flexible packaging is expected to play an increasingly important role in durable goods and rigid non-food applications, including crates, pallets, storage boxes and horticultural products. These applications can absorb material volumes that flexible packaging applications may not be able to take.

At the same time, contact-sensitive PP packaging still needs routes capable of meeting PPWR recycled content obligations, including chemically recycled material.

So, although PE and PP are often grouped together as polyolefins, they are likely to follow different end-market pathways. PE provides scale through high-volume film applications. PP has a more important role in rigid and durable goods markets, while contact-sensitive PP packaging will need higher-specification recycling routes.

The report was developed to help clarify recycled content requirements and support more informed planning, investment and infrastructure decisions across the value chain as PPWR implementation accelerates.

The findings also help inform wider CEFLEX work on sorting and recycling recommendations, focused on how collection, sorting and recycling systems may need to evolve between now and 2030–2035 to meet future demand for flexible packaging derived PCR.

For recyclers, the work helps give more definition around where future demand could emerge, which applications may absorb larger material volumes, and where quality expectations are likely to become more stringent.

For converters and brand owners, it provides a clearer view of how recycled content obligations, material availability and design choices increasingly interact over time.

For Extended Producer Responsibility schemes and system operators, the analysis reinforces that collection and recycling targets are only part of the picture. The material also needs realistic downstream applications if the economics of circularity are going to work in practice.

For policymakers and investors, the report shows how closely connected collection, sorting, recycling capability, material quality and end-market demand really are. It also helps indicate where infrastructure, quality management and market development may have the greatest impact.

There is a positive foundation to build on: substantial end markets for recycled flexible packaging material already exist across Europe, with potential for further growth as systems mature and quality improves. The challenge is to align quality, infrastructure, supply and demand quickly enough to support EU legislative targets over the coming decade.

The intention is to contribute to shared evidence for the sector: something practical that can help reduce uncertainty, support investment decisions and accelerate progress towards a circular economy for flexible packaging.

And, as with any work from CEFLEX – particularly forecasting and analysis – we also hope it will trigger new, enriching discussions and opportunities to exchange data and insights where possible. I hope people will reach out to us to learn more and do just this.