Regulators and brand owners have a vision for more recycled content in packaging. Yet projected supply and demand aren’t in sync, according to a new analysis by Smithers, one of several recently released industry reports on opportunity areas and ongoing challenges with scaling up PCR use.
Research services firm Smithers published a white paper assessing how supply and demand challenges in PCR markets could play out in the future. Globally, corporate goals are projected to spur 25 million metric tons of PCR demand by 2030, according to the report.
Still, only about 5 million metric tons are currently available in the market, according to Smithers. While that’s projected to grow to 6.5 million by 2031, it’s short of the goal level.
In North America the last five years, the compound annual growth rate for PCR consumption was 3.3%. Smithers is tracking that to climb to 4.7% between 2026 and 2031, driven in part by extended producer responsibility policies.
But it’s not a straightforward path to realign supply with demand. The report laid out four possible future scenarios — overcapacity, stagnation, a supply crunch or radical growth — depending on a variety of levers such as recycler investment, resin pricing and whether the focus shifts to other sustainable packaging strategies besides incorporating PCR.
During the next five-year period, Smithers projected the greatest CAGR by polymer to be for PET (6.1%), helped by existing infrastructure and established food-grade demand. As for end uses, healthcare is expected to grow most significantly (6.9%), followed by packaging for cosmetics (5.9%), drinks (5.9%) and food (5.8%).
The use of rPET is already on the rise, according to newly shared data from the National Association for PET Container Resources. Demand for rPET in the United States and Canada was up 5.6% in 2025 compared with 2024. The average level of recycled content in U.S. bottles reached a high of nearly 23%.
But recycled resins — and their potential to be used in different types of packaging — are not a monolith.
A new resource from the U.S. Plastics Pact detailed PCR guidance by packaging format and application. With the EPR catalyst becoming a bigger factor in the U.S., USPP also put out a resource outlining how to design ecomodulation to support PCR markets. The organization argued that incentives can be powerful when they’re compelling enough to change behavior and are tied to consistent recyclability criteria, but must also be differentiated by material and application.
“PET bottles, HDPE containers, PP rigid packaging, EPS, and flexible film have fundamentally different recycling infrastructure realities, cost premiums, and PCR supply chains,” USPP’s report stated. “Uniform incentives applied across all formats either set impossible expectations for difficult materials or over-reward easier ones. Effective systems differentiate by polymer and application and acknowledge food-contact constraints explicitly.”
Of the upcoming PCR demand that Smithers projects, roughly 80% is in rigids and 20% is in flexibles. But there are some limiting factors with PCR in the latter format, according to a new U.S. market profile and circularity assessment report from the Flexible Packaging Association. These include potential performance or color limitations compared with virgin material. High volumes and less sensitivity to these issues put applications like trash bags and retail bags at the top of FPA’s list as formats with the highest potential for including PCR.
“Incorporating PCR into flexible films can be more challenging than in other packaging materials as the layers are highly engineered and extremely thin, and slight imperfections can lead to tears or holes in film layers,” FPA noted in its report. “Despite growing demand, PCR incorporation varies significantly by application and packaging structure.”
