United States Sustainable Packaging Market By Material (Paper, Plastic, Glass, Metal), By Process (Recycled Packaging, Reusable Packaging, Degradable Packaging) By End-Use (Food & Beverages, Cosmetic & Personal Care, Pharmaceuticals & Healthcare, Others), By Region, Competition 2021-2031F

Forecast Period	2027-2031
Market Size (2025)	USD 71.45 Billion
CAGR (2026-2031)	5.11%
Fastest Growing Segment	Food & Beverages
Largest Market	Midwest
Market Size (2031)	USD 96.35 Billion

Market Overview

The United States Sustainable Packaging Market will grow from USD 71.45 Billion in 2025 to USD 96.35 Billion by 2031 at a 5.11% CAGR. Sustainable packaging is defined as the development and use of packaging solutions that minimize environmental impact through renewable sourcing, recyclability, and lifecycle efficiency. The United States market is primarily driven by stringent regulatory frameworks focused on waste diversion and extended producer responsibility, which compel manufacturers to adopt circular economy mandates. Furthermore, robust corporate commitments to decarbonization and supply chain optimization act as fundamental catalysts for growth, distinct from transient consumer preferences.

However, a substantial challenge hindering broad market expansion is the fragmented domestic recycling infrastructure, which often lacks the capacity to process advanced bio-based or compostable materials effectively. This infrastructure gap results in significant material loss and complicates the recovery of valuable resources. According to the American Institute for Packaging and the Environment, in 2025, industry-led source reduction efforts decreased packaging volume by five million metric tons between 2019 and 2024. This statistic illustrates that while material efficiency is improving, the misalignment between packaging design and recovery capabilities remains a critical impediment.

Key Market Drivers

Stringent Government Regulations and Extended Producer Responsibility (EPR) Laws are fundamentally reshaping the United States Sustainable Packaging Market by shifting the financial burden of waste management from municipalities to manufacturers. This legislative pressure, particularly evident in California’s rigid frameworks, compels companies to internalize end-of-life costs and accelerates the redesign of products for recyclability and compostability to avoid punitive fees. The mandate for producers to finance the recovery of their materials creates a direct economic incentive to innovate. According to CalRecycle, August 2025, in the 'SB 54 Plastic Pollution Prevention and Packaging Producer Responsibility Act Permanent Regulations' update, producers are legally mandated to contribute $500 million annually starting in 2027 to mitigate environmental impacts, a financial obligation that is actively forcing the adoption of circular infrastructure.

Corporate Integration of ESG Goals and Circular Economy Principles acts as a complementary driver, as major corporations voluntarily outpace regulatory minimums to secure brand reputation and achieve decarbonization. These entities are aggressively optimizing supply chains to reduce virgin plastic usage, driving significant demand for alternative materials and lightweighting solutions. For instance, according to Amazon, July 2025, in the '2024 Sustainability Report', the company achieved a 16.4% reduction in single-use plastic delivery packaging globally in 2024 by substituting plastic air pillows with recyclable paper fillers. However, despite these corporate successes, systemic material transition remains challenging across the wider market; according to Walmart, September 2025, in the 'FY2025 ESG Report', the company's post-consumer recycled content in private-brand plastic packaging reached only 8% in 2024.

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Key Market Challenges

The fragmented domestic recycling infrastructure stands as a critical impediment hampering the growth of the United States Sustainable Packaging Market. While manufacturers are aggressively adopting advanced bio-based and circular materials to meet decarbonization goals, the downstream recovery network remains technologically outdated and inconsistent across regions. This misalignment results in a significant volume of theoretically recyclable or compostable packaging being diverted to landfills because Material Recovery Facilities (MRFs) lack the specialized equipment to sort these modern substrates. Consequently, the inability to effectively recapture these materials erodes the economic value proposition of circular supply chains, making the transition to sustainable alternatives cost-prohibitive for many producers who rely on recovered feedstock to offset production costs.

According to the Association of Plastic Recyclers, in 2025, the domestic recycling industry possessed the unused infrastructure capacity to process approximately two billion additional pounds of material annually, yet this potential remained untapped due to severe systemic failures in collection and sorting mechanisms. This statistic demonstrates that the market's stagnation is not due to a lack of processing demand, but rather a fundamental inability of the current infrastructure to aggregate and deliver quality materials, thereby neutralizing efforts to scale sustainable packaging solutions.

Key Market Trends

The widespread shift toward fiber-based paperization is fundamentally altering the market landscape as brands aggressively substitute single-use plastics with renewable substrates compatible with existing municipal recycling streams. This transition is being executed to bypass the systemic limitations of plastic recovery, leveraging the high capture rates of the domestic paper infrastructure to meet circularity targets. The industrial demand for these recovered materials validates this strategic pivot, creating a robust loop between consumer disposal and manufacturing uptake. According to the American Forest & Paper Association, August 2025, in the '2024 Paper and Cardboard Recycling Rates' announcement, U.S. mills utilized 1.29 million more tons of recycled paper in 2024 compared to the previous year to produce new packaging and products. This surge in mill consumption demonstrates that the migration to fiber is not merely a design trend but a commercially viable realignment supported by active downstream processing capacity.

Concurrently, the adoption of mono-material recyclable films represents a critical engineering response intended to salvage the sustainability profile of the flexible packaging sector. By reformulating multi-layer laminates into single-polymer structures, typically polyethylene, manufacturers are resolving the contamination issues that historically diverted flexible formats to landfills, thereby aligning this massive category with emerging store drop-off and mechanical recycling pathways. This technical evolution is essential for preserving the economic value of flexible packaging, which remains a dominant format due to its logistical efficiency. According to the Flexible Packaging Association, February 2025, in the 'FPA Reflects on 2024: A Year in Review' report, the United States flexible packaging industry was estimated to be $42.9 billion in annual sales for 2023. As this substantial market segment transitions to mono-material designs, it secures a pathway to regulatory compliance while maintaining the barrier properties required for product protection.

Segmental Insights

The Food & Beverages segment stands as the fastest growing category in the United States Sustainable Packaging Market, fueled by the widespread transition away from single-use plastics. This expansion is driven by heightening consumer demand for circularity and the need for compliant, eco-friendly disposal options. The Food and Drug Administration (FDA) plays a critical role in this trajectory by establishing rigorous safety standards for Post-Consumer Recycled (PCR) materials in food-contact applications. This regulatory clarity allows manufacturers to implement sustainable innovations at scale, accelerating the segment's development while ensuring strict adherence to safety protocols.

Regional Insights

The Midwest holds the leading position in the United States Sustainable Packaging Market, primarily driven by the significant concentration of major food and beverage manufacturers in the region. This industrial density creates substantial demand for recyclable and biodegradable materials as companies align with sustainability mandates and waste reduction goals. Furthermore, the region benefits from established manufacturing infrastructure and proximity to agricultural feedstocks necessary for bio-based plastic production. These factors collectively establish the Midwest as the central hub for the adoption and distribution of environmentally responsible packaging solutions.

Recent Developments

• In July 2025, Graphic Packaging Holding Company released its impact report, revealing significant progress in its sustainability goals within the consumer packaging sector. The company reported that a vast majority of its products sold were characterized as recyclable, and it had successfully replaced approximately one billion plastic packages with paperboard alternatives. The update highlighted the implementation of a virtual power purchase agreement intended to cover a substantial portion of electricity usage with renewable energy. These advancements demonstrated a strong commitment to reducing greenhouse gas emissions and supporting the transition toward a renewable future in the United States sustainable packaging market.
• In September 2024, Sealed Air Corporation announced a strategic collaboration with a major electronics retailer to enhance sustainable packaging solutions across North America. This partnership focused on increasing the use of recycled materials in shipping operations, specifically introducing bubble cushioning made with significant recycled plastic content and inflatable air pillows. The initiative also included the deployment of paper-based mailers to reduce reliance on virgin plastics in the supply chain. Furthermore, the agreement facilitated the collection and recycling of flexible plastic waste from distribution centers, directly supporting the circular economy within the United States sustainable packaging market.
• In September 2024, RENW launched a new line of plastic-free packaging solutions derived from industrial hemp, targeting the United States market. This development introduced a fully integrated, plant-based alternative designed to replace fossil fuel-based plastics and reduce deforestation. The company utilized a proprietary technology that processed the whole hemp plant to minimize waste and lower carbon emissions. These biodegradable and compostable products were positioned to help brands meet strict environmental regulations and consumer demands for regenerative materials. The launch included plans for establishing bioregional manufacturing facilities across the U.S. to support local agriculture and economic growth.
• In June 2024, Berry Global Group released comprehensive research detailing how artificial intelligence could revolutionize the design of sustainable packaging. The company engaged in a study demonstrating that AI tools, when combined with human creativity, could significantly accelerate the development of user-centric, eco-friendly solutions. This research highlighted the ability of AI to analyze vast amounts of consumer data to predict trends, thereby enabling the creation of packaging that optimized recyclability and material usage. The findings underscored the potential for digital technologies to bridge the gap between aesthetic appeal and the technical requirements of the circular economy in the packaging sector.

Key Market Players

• Amcor PLC
• Berry Global Group Inc.
• Sealed Air Corporation
• Graphic Packaging Holding Company
• International Paper Company
• WestRock Company
• Ball Corporation
• Crown Holdings Inc.
• Smurfit Kappa North America
• Mondi Group

By Material	By Process	By End-Use	By Region
Paper Plastic Glass Metal	Recycled Packaging Reusable Packaging Degradable Packaging	Food & Beverages Cosmetic & Personal Care Pharmaceuticals & Healthcare Others	Northeast Midwest South West

Report Scope:

In this report, the United States Sustainable Packaging Market has been segmented into the following categories, in addition to the industry trends which have also been detailed below:

• United States Sustainable Packaging Market, By Material:

• Paper
• Plastic
• Glass
• Metal

• United States Sustainable Packaging Market, By Process:

• Recycled Packaging
• Reusable Packaging
• Degradable Packaging

• United States Sustainable Packaging Market, By End-Use:

• Food & Beverages
• Cosmetic & Personal Care
• Pharmaceuticals & Healthcare
• Others

• United States Sustainable Packaging Market, By Region:

• Northeast
• Midwest
• South
• West