Blonde ambition

Tetra Pak’s Chinese goal: to recycle 27 billion cartons a year

Blonde ambition

Tetra Pak introduced its first beverage carton in 1952.

Back in the Fifties, sales to China would not have been high on the agenda for the Swedish packager. In fact, it took 40 years for the Tetra Pak to make the journey east, for a first appearance at a Beijing trade fair in 1972.

Times have changed: the firm sold 27 billion of its cartons in China last year and Tetra Pak’s aseptic packaging now protects hundreds of different beverages – anything from fruit juice to yak milk.

Of course, think Sweden and you think Abba, blondes, ridiculously expensive beer and (like Tetra Pak) a disproportionately lengthy list of corporate success stories.

But Swedes also have a stellar green reputation. And in China Tetra Pak is finding it a struggle to live up to its environmentally-friendly credentials.

Last year barely a sixth of its cartons there were recycled, with the remainder heading for landfills and incinerators. That is partly because the government still doesn’t have a comprehensive waste sorting system, and partly because recycling the cartons just isn’t very profitable yet.

Tetra Pak cartons are made from thin layers of paper, aluminum and plastic all sandwiched together. And recyclers complain that their usual recycling methods can’t cope. The effort to separate the carton layers is still too costly.

In response, Tetra Pak started working with Tianyi Plastics Corporation and Shandong Liaocheng University to find a solution. They’ve developed a cheaper “Chinese method” for separating the aluminium and plastic layers from the paper ones last year.

The equipment isn’t cheap (around Rmb15 million). But the recyclers are still grateful for Tetra Pak’s help. “[They] helped us a lot with basic equipment and by demonstrating the technology”, explains Fulun Paper Mill CEO Yang Jun.

“After all, we need to be profitable to be able to quickly build up scale,” Xin Hong Peng Paper Mill CEO Guo Zhen told 21CN Business Herald.

Since Chinese waste isn’t normally very well sorted, the Tetra Pak recyclers’ business model also depends heavily on “scavengers” to collect discarded cartons.

Rather incredibly, there are 2.3 million of them, sorting trash across 600 cities. The collectors make up a large, transient army of rural migrants, often without social security entitlements or fixed addresses.

Still, Tetra Pak’s hope is that, with time, the Chinese recyclers will become more self-reliant. “Once their business models are in line with market principles and they are profitable, they’ll enter a virtuous cycle,” says Tetra Pak China Vice President Yang Bin, “[then Tetra Pak] can be pulled out.”

Even though the Tetra Pak cartons are designed to be 100% recyclable, the company also has to ensure that the process used to recover the materials is also as green as possible.

“For Tetra Pak, it’s a bit like walking on a tightrope,” explains Yang Bin, “We have to carefully maintain balance.”

Separating the different layers, for example, is energy and water intensive. Tetra Pak’s recycling partners Guo Zhen and Yang Jun spent over $700,000 on a sewage treatment system for the wastewater. But they know too that many of their competitors cut corners. That is to say, they can recycle more cheaply – and thus more profitably – but the environment takes another hit in the process.

“The reality of it is very cruel indeed,” observes Guo sagely. “In a market lacking regulation and supervision, good [recycling] behaviour won’t necessarily bring good business results.”

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