Industry leaders have renewed calls for national packaging reform, warning that Australia's manufacturing resilience, recycling investment and sovereign capability remain vulnerable without policy action to create demand for locally recycled content and provide a more level competitive playing field.
Those were the central themes of a panel discussion at Industrial Transformation Australia, part of the CeMAT Australia exhibition in Melbourne this week, where packaging and recycling leaders argued that recent global supply chain disruptions should serve as a catalyst for long-overdue reform.
Moderated by PKN publisher Lindy Hughson, the session brought together Simon Dowding, head of strategic communications and government relations at Pact Group; Aleks Lajovic, managing director of Impact International; and Ben McCulloch, category manager – sustainability at Martogg & Company.
Opening the discussion, Hughson challenged the premise of the session itself.
"Our topic tells us that we should be talking about self-sufficiency, but listening and talking to the industry in recent weeks, I think the real question is: what capabilities do we need to retain here in Australia if we want to remain resilient, competitive, and able to withstand future shocks?"
Resin disruption exposed structural weaknesses
Reflecting on the recent resin supply disruption linked to instability in the Middle East, Dowding said Australia had once again been reminded of the risks associated with heavy dependence on imported virgin polymers.
"We saw the price escalate out of this world — in some cases more than 100 per cent. We also saw shortages and companies declaring force majeure, ripping up contracts and saying if you want it, you've got to buy it on the spot market or pay more," he said.
"What it taught us was that we need to be much more self-reliant... We need to have regulation to have more recycled content in our packaging to become more self-sufficient."
Lajovic said the disruption also revealed how little many Australian manufacturers understood about the complexity of global supply chains.
"We thought we were buying resin from Asia, but the feedstocks were predominantly coming from the Middle East," he said.
"It takes a village to make packaging, and it really highlighted how small our village is getting... We really should be looking at our policy and making us more resilient."
McCulloch said Australia had invested significantly in domestic recycling capability over the past decade, but warned those investments now needed policy support.
"We've seen a lot of investment into recycled polymer technology and plants, and I feel that we need to see a bit of government support. We need to nurture those plants... The way to do that is by utilising local recycled content."
Skills and capability also at risk
Beyond manufacturing capacity, the panellists argued Australia was steadily losing industrial knowledge, specialist skills and supplier ecosystems.
Using the closure of Australia's automotive manufacturing sector as an example, Lajovic said the industry had also lost important training pathways.
"We need people who are experts in injection moulding, extrusion, printing... We need to be investing in our future and trying to learn from these past mistakes. We've had two big wake-up calls within six years of each other, and we don't seem to be heeding the lessons."
Dowding pointed to the employment benefits of recycling.
"For every two jobs it takes to send waste to landfill, you create nine jobs by recycling it. We've got the technology, we've got the know-how and we've got the human resources to do it — we're just not doing enough of it."
Demand remains the missing link
While Australians have embraced household recycling, Dowding said only a fraction of collected plastics are ultimately remanufactured into new products.
"People would probably be horrified to know that out of all the plastic that's collected that is recyclable, only about 10 per cent ends up back in a plastic product," he said.
Asked why, his answer was succinct:
"It's demand."
Without regulation requiring recycled content and recyclable packaging design, brand owners naturally gravitate towards the lowest-cost material, he said.
An uneven playing field
The discussion then turned to Australia's competitive position relative to overseas manufacturers.
McCulloch said domestic recyclers were competing against countries operating with the same technology but much lower labour and energy costs.
"If we want to see the domestic industry here in Australia thrive, there needs to be a bit of an even playing field... We'd love to see government support the back end of these facilities because no one's investing big dollars into these plants expecting to run at 20 or 30 per cent."
Lajovic argued Australian manufacturers were accountable for every environmental claim they made — something he believed was far harder to verify with imported packaging.
"If we make a statement and we are blatantly lying about it, the consumer protections and the laws in this country are extremely strict," he said.
"If I'm buying packaging from China and they say it has 40 per cent PCR... it's very difficult to have any recourse."
He also highlighted escalating operating costs.
"Our land tax bill has doubled in the last four years... Sometimes it feels like you're going into a boxing match and you have one hand tied behind your back here in Australia."
Dowding said packaging reform would help address these market distortions by creating consistent demand for recycled materials.
"The responsibility shifts from consumers to brand owners, and those fees are reinvested into the system to process and manufacture Australian goods."
Recycling investment needs demand certainty
The panel warned that hundreds of millions of dollars invested in Australian recycling infrastructure could be undermined without stronger market signals.
Dowding said Circular Plastics Australia's food-grade PET recycling facilities were operating successfully because they had both reliable feedstock and committed end markets.
The company's mixed rigid plastics facility, however, was not running at capacity.
"We don't have enough demand from brand owners to incorporate the recycled content back into their products."
McCulloch said continued uncertainty discouraged further investment.
"We want to see a system where all of this is thriving... Consumers need to know that what they're collecting and recycling here in Australia, something is actually happening to it."
Asked what would happen if domestic recyclers continued losing market share to lower-cost imports, McCulloch warned the alternatives were unpalatable.
"The only two options are recyclables to landfill, or reopening export of that product — neither of which are a good outcome."
Community impacts extend beyond industry
Lajovic broadened the discussion beyond manufacturing economics, pointing to the social value created through container deposit schemes.
"The CDS has really brought the community along for the ride," he said.
"In our factory we have collection points where staff put their empty cans and bottles... that goes to sporting clubs to pay for jerseys. Other people use it to help with pocket money for their kids.
"If all of a sudden the demand does not exist for the material collected by the CDS to be utilised here in Australia... those shockwaves will echo through all different parts of the community."
Audience questions turn to government action
Audience discussion focused heavily on the prospects for national packaging reform.
Asked whether governments would realistically deliver meaningful change within six months, Dowding said all jurisdictions had committed to packaging reform but acknowledged progress depended on political priorities.
"The biggest sticking point is government priority... It's just not something you find people out in the street talking about."
McCulloch was more cautious.
"The work's been done... It's a very clear case that we need to get on with it.
"What we don't want to see is the can continue to get kicked down the road on this one. We just can't afford to have it."
Lajovic suggested Australia should not view stronger regulation as unusual.
"Europe is already doing this. Companies outside Europe will really struggle to meet those regulations... We would not be the first ones. We would actually be following what the leaders in sustainable packaging are already doing."
Retailers and consumers also have a role
Responding to a question about the role of retailers, McCulloch cautioned against allowing plastics to become the villain in packaging discussions.
"Plastic has been demonised... but it's very often the most fit-for-purpose product," he said, arguing material choices should be based on functionality rather than perception.
Dowding said retailers and brand owners were broadly aligned behind packaging reform.
"They all want this reform. A lot of them just want to know, 'Tell us what we need to do and we'll do it.'"
A clear consensus
Asked to nominate the single action that would make the greatest difference over the next five years, each panellist arrived at much the same conclusion.
Lajovic called for greater recognition of Australian-made packaging.
Dowding urged governments to "get on with packaging reform".
McCulloch said mandated recycled content would "change things instantly".
While their perspectives differed, the panel ended with a clear consensus: Australia's manufacturing resilience will depend not simply on investing in recycling infrastructure, but on creating the policy settings that enable those investments to succeed.
