What is sustainable packaging and why is it important?

Sustainable packaging refers to eco-friendly materials and processes that reduce environmental impact. This includes recycled cardboard, bioplastics, and innovative materials that break down naturally. It's important because consumers and businesses increasingly demand environmentally responsible solutions, driving significant market growth.

What does portfolio optimisation mean for companies?

Portfolio optimisation is when companies sell off non-core business units to focus on their most profitable areas. For example, International Paper sold its cellulose fibers division to concentrate on sustainable packaging. This strategy helps companies become more efficient and unlock shareholder value.

How do divestments create opportunities for other companies?

When large companies sell business units, it creates market opportunities for competitors and suppliers. The divested assets may find new owners who can run them more efficiently, whilst the selling company can reinvest the proceeds into growth areas, potentially benefiting suppliers and partners in those sectors.

What does 'cyclical industry' mean?

A cyclical industry is one where performance tends to follow economic cycles, with periods of growth followed by downturns. The packaging industry is cyclical because demand often correlates with overall economic activity and consumer spending. Understanding these cycles can help investors time their investments better.

What are the main drivers of growth in sustainable packaging?

Growth is driven by consumer demand for eco-friendly products, corporate sustainability commitments, regulatory pressure to reduce waste, and e-commerce growth requiring more packaging solutions. Companies that can provide innovative, sustainable alternatives to traditional packaging are well-positioned to benefit.

18 handpicked stocks

Green Packaging Investment Theme: 18 Stocks (2025)

International Paper's $1.5 billion sale of its cellulose fibers unit signals a strategic pivot to its core sustainable packaging business. This move highlights a broader industry trend of portfolio optimization, creating potential growth opportunities for companies focused on eco-friendly packaging solutions and related industries.

Han Tan | Market Analyst

Updated 1 day ago | Published at agosto 22