The sustainable beverage packaging trend accelerated in Southeast Asia prior to 2020, buoyed by greater consumer awareness of sustainability and increased focus by various stakeholders. However, as consumers in the region are largely price conscious and unwilling to pay more for sustainable beverage packaging despite the increased awareness, other key stakeholders have led the sustainability drive, with governments incentivising a shift towards a circular economy and manufacturers focusing on recycling, packaging reduction and the adoption of more sustainable packaging alternatives.

Sustainable packaging has taken on increased importance in beverage companies globally, due to a myriad reasons ranging from fulfilling corporate social responsibility objectives and achieving positive branding, to appealing to increased expectations among consumers for sustainable practices and packaging, particularly in regions such as Western Europe and North America. This has led to many global beverage giants including Coca-Cola, PepsiCo, Nestlé and Suntory having long-term sustainability pledges in areas such as reduced plastic waste and increased usage of rPET and other sustainable materials for beverage packaging.

In Southeast Asia, sustainable beverage packaging practices by both global and local players have often focused on the “3Rs” of reduce, replac and recycle. As part of “reduce”, some firms have reduced packaging deemed as non-essential, to reduce the resulting packaging waste as well. For example, Yakult Singapore pledged to eliminate single-use plastic straws and stopped providing straws for its yoghurt drink from end of December 2018. 

The “replace” component refers to the replacing of pack types such as plastic with more recyclable or biodegradable pack types. According to Nestlé Malaysia, it was the first food and beverage company in Malaysia to introduce paper straws for packaged drinks, when it rolled out paper straws for its Milo packaged drink in 2019, in place of the usual plastic straws. Winking Seal Beer Co, more commonly known as a craft beer player, launched bottled water in a canned version in Vietnam. While PET bottles are the norm for bottled water in much of Southeast Asia due its cost efficiency in production, lightweight and convenience from its portability, metal cans are seen as more environmentally friendly from a recycling viewpoint. 

The “recycle” aspect comprises both greater recycling and a greater use of recycled material for packaging production. In Indonesia, Danone introduced 100 percent recycled PET for its Aqua bottled brand in early 2019, starting in Bali before being made available in other cities such as Jakarta.

Unlike beverage manufacturers, who can incorporate beverage packaging sustainability in various stages of the procurement and manufacturing process in coordination with packaging producers, government initiatives in sustainable beverage packaging appear more focused on incentivising recycling as part of a wider circular economy approach. Indonesia’s second largest city, Surabaya, launched a scheme from 2018 that allowed residents to have their bus rides paid for with used plastic bottles. The financial incentive of free rides attracted a significant buy-in from residents, with some residents more consciously collecting plastic waste to use as bus fares rather than merely throwing it away. This has helped authorities to achieve their aim of spreading awareness about packaging sustainability and collecting more plastic bottles for recycling. Similarly, Singapore’s National Environmental Agency partnered with beverage manufacturing firm F&N in an initiative to roll out 50 reverse vending machines across Singapore. Beverage consumers were incentivised to recycle plastic bottles and metal aluminium cans at these machines in exchange for supermarket discount coupons. 

However, not all government sustainable packaging initiatives are incentive-based. Singapore’s Nee Soon East constituency unveiled a zero-waste masterplan in 2019, with plans to restrict vending machines sales to metal beverage cans, excluding the common pack type of plastic bottles, which is regarded as less recyclable.

For all the sustainable packaging efforts by governments and manufacturers, it will require an all-of-society effort from all stakeholders and a change in mindset and lifestyle among consumers in order for the sustainable beverage packaging trend to progress further in Southeast Asia. Other stakeholders such as foodservice outlets have attempted to contribute to the beverage sustainability drive through fostering lifestyle habits such as reducing and eliminating the usage of plastic straws. It is not uncommon to find bamboo straws being used in restaurants of some Vietnamese cities such as Ho Chi Minh City. 

Meanwhile in Thailand, vegan restaurant chain Broccoli Revolution showed its creativity by replacing plastic straws with edible kangkong straws. In Singapore, fast food outlets such as KFC started implementing a strict “no straw” policy, although this has received pushback from some customers. Reports of KFC customers taking straws from adjacent foodservice restaurants is indicative of a key challenge to the sustainability mind-set among some consumers— the unwillingness to sacrifice personal convenience for sustainability.

CORonAVIRUS & ITS IMPACT ON BEVERAGE PACKAGING

A major threat to the sustainable beverage packaging momentum in Southeast Asia is the current coronavirus (COVID-19) pandemic. With COVID-19 lockdown measures wreaking havoc on foodservice beverage sales across Southeast Asia, sustainability may take a backseat to COVID-19 in the short term among major stakeholders such as beverage manufacturers, as they prioritise company resources on more pressing immediate concerns such as cost-cutting measures. Governments have also diverted substantial planning and resources towards battling the pandemic, with sustainability initiatives such as reverse vending in Singapore being temporarily suspended, in line with the postponement of non-essential activities. In a period of home seclusion, increased takeaway and food and beverage delivery has also generated additional packaging waste.

Nevertheless, this unprecedented COVID-19 pandemic has also provided new opportunities for sustainable packaging innovation by beverage manufacturers, relating to packaging and cost reduction. With cost savings being the immediate aim of most beverage companies, reducing packaging and packaging waste such as straws could become more commonplace, as it positively impacts companies’ bottom lines. Home seclusion during COVID-19 has heralded a change in consumer beverage purchasing behaviour, with a shift from single-serve portions and impulse purchasing to larger take-home portions and multipacks. The upsizing of pack sizes during this period could create the unintended positive impact of reduced beverage packaging in terms of unit volume, and potentially reduced packaging waste from the actual beverage itself. Furthermore, a shift to multipacks has created opportunities for beverage manufacturers in Southeast Asia to adopt multipack sustainability ideas from other regions. Coca-Cola in Europe is phasing out its shrink wrap packaging in its multipacks and replacing it with sustainable paperboard toppers. Replicating it likewise in Southeast Asia on a large scale not only reduces packaging waste and utilises more recyclable packaging, but could also generate cost savings.   

As the COVID-19 pandemic shows no signs of abating, the sustainability momentum may be slowed in the short term, as cost-consciousness takes on more urgent priority among stakeholders such as beverage manufacturers and consumers. Reduced disposable income among consumers in Southeast Asia is expected to shape their beverage purchasing behaviours, prioritising value for money purchases rather than products with sustainable packaging. However, the cost-focus prioritisation of manufacturers during this period could actually accelerate sustainable cost-saving measures such as the elimination of straws in beverage packaging, while Southeast Asian beverage and packaging manufacturers have the chance to explore sustainable multipack features such as paperboard toppers. A new normal of greater home consumption and multipack purchasing in this COVID-19 era indeed creates opportunities for a new normal in sustainable beverage packaging.