PET-BEVERAGE REPORT 2020

Hardly any other industry is so dependent on sustainability as the food industry. And all sectors of this industry feel committed to sustainability and align themselves with the production of their products. However, things often look different when it comes to packaging and marketing. Primary packaging for food and beverages is becoming more and more complex, and smaller and smaller portions are being offered in visually striking packaging. What was packaged in glass or tinplate years ago is now often packaged in plastic, and reusable packaging is only gaining acceptance in isolated cases. The international brewery and beverage industry is developing in a different way: traditionally, reusable kegs have been used to fill beer and beverages for the gastro trade. Barrels made of wood have been used for centuries, later made of aluminum and until today made of stainless steel. The costs were always compared to the benefits in a sustainable way. But a new packaging trend is coming into the picture, without this development is being noticed by consumers. Beer, wine and other drinks are being filled in environmentally unfriendly PET kegs more and more often. Easy to transport, meant to be thrown away. Billions of liters of beer and not much less in wine and other beverages are bottled at the expense of the environment and out of sheer greed for profit on the part of corporations. Time for clarification.

Environmental pollution by plastic and marine littering are one of the most challenging global ecological problems at present time.

According to latest studies, the global production of plastic has exponentially increased in 2018 to 420 million tons. Since the first commercial use of plastic in 1950, total production has exceeded 8 billion tons. Only 10% of this volume has been collected and recycled since then. In other words, there is one ton of plastic for each human being on this planet of which only ten kilogram per person has been recycled. The rest is still polluting the environment.

Due to this inadequate and insufficient reclaim of plastic, eight million tons of plastic are washed away and taken by rivers into our oceans every year. The WHO estimated in 2018 the total amount of plastic in our oceans at 146 million tons. Projections say, that in 2050 there will be more plastic in the ocean than fish (source: www.plasticsoupfoundation.org). The so-called Great Pacific Garbage Patch has already reached the size of Germany, France, Netherland, Belgium and Italy altogether.

This causes an extremely serious threat to human- and animal life because the process is not reversible. More than 95% of all plastic is invisible as it doesn’t float on the surface. It is

submerged and partly cracked up into plastic fragments with a diameter than less than 5 mm. These microplastics need 450 years to biodegrade and will not only be a problem for us and our kids but also for the many generations to come.

Microplastics enter the human body via the complex food chain and ultimately via fish. The American Chemical Society (ACS) revealed in its Fall 2020 Report that micro-plastics have been found in humans. The impact on human life is completely unexplored but first correlations for modern cultural diseases have been drawn. (source: www.acs.org/). Its impact on the human body is still completely unexplored, but first correlations with modern cultural diseases such as chronic inflammation, triggers for Neoplasia (tumors) and disorder of the autoimmune system. (Source: www.sciencedirect.com/ S0048969719344468)

On June 2019, the United Nations took a profound decision on plastic pollution and marine littering (source: www.unenvironment.org/cobsea). Because marine littering is regionally caused but has a global impact all countries were ordered to develop a regional action plan to contribute to the five main actions. The first and foremost task is “Preventing and reducing marine litter from land-based sources“, because 90% of the entire plastic entering the oceans is carried by just 10 rivers, mainly in Asia and Africa.

Since than almost all nations have assigned to take actions for a more circular economy on the fast track. • China introduced a ban for non-degradable plastic bags by end of 2020 in larger cities and 2022 nationwide. • Russia and Norway have started a partnership in reducing plastic waste to the Bering Sea. • Italy has implemented a €500 penalty for the users of plastic plates and cups at the beaches, after they found more than 80 plastic pieces per square meter of beach. • Indonesia, the world’s second biggest plastic polluter, has launched a program to reduce marine plastic waste by 70% until 2025. The total economic cost has been sized with US 5.1 trillion. • Germany wants to increase the amount of recycled plastic from 37 %to 63 % within the next 2 years.

Until then, the German government will participate in a EUR 7.5 million research project through the Federal Ministry of Research together with 10 other European countries in order to research the effects of this obvious global catastrophe, mainly caused by European companies. The Federal Environment Ministry is making available € 50 million to help the countries concerned to collect the rubbish that is often produced on the plants of German companies. (Source: Googlestring and ).

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For years there has been an increasing trend to use plastic for primary packaging instead of reusable systems. Industrial countries like the US, Belgium, Germany, Italy, Ireland and New Zealand are inglorious benchmarking leaders with daily more than 0.5 kg plastic waste per person. Needless to say, that these countries have also a high reclaim- and collection rate and the risk of pollution is marginal. However, these countries are key producers for plastic packaging and many of those are exported. Countries like China, Pakistan, Bangladesh, Indonesia and India, representing more than 40% of the world’s population, have so far a completely insufficient collection system for waste and plastic packaging. In average 0.1 kg of plastic per person are daily disposed in dumps or uncontrolled landfill sites. (source: www.ourworldindata.org)

And now the brewery industry is sacrificing an existing reusable system out of greed for profit and is introducing disposable plastic kegs with unbelievable growth rates, supported by, without exception, European companies that operate or build the systems for manufacturing the kegs.

The use of kegs made from PET (polyethylene terephthalate) for beer and beverages has started about 15 years ago and has reached in 2018 the yearly number of 50 million kegs, which equals to 75,000 tons of plastic. Companies like Petainer, Unikeg, KeyKeg, Dolium and Polykeg dominate the market and new suppliers are increasingly entering the market. Almost all of them are based in Europe or US.

The advantages for the supplier and the consumers seem to be obvious: cheap and lightweight packaging, easy to transport, no capex, no return cost, no cost for cleaning, maintenance or empty-good handling, and finally, no financial risk for non-returned kegs. The clear focus here is on the improved profitability and the reduced capital investment. One-Way kegs are mostly used in slow rotating markets, for export business or in markets with a high loss rate. As a result, emptied PET-kegs remain in Asia, South America, Africa or other less-developed regions of the world with low or no recycling rates.

3/6 All PET keg suppliers point out that PET containments are fully recyclable. Additionally they state that their products are “sustainable“ and “environmentally friendly” , with reference to the reduced CO2-footprint for cutting off the emissions for the return transport. But reality shows that most of the kegs are not recycled or combusted.

Collectively, producers of PET plastic kegs are ignoring the global threat coming from their products and trying to keep their hands clean in pretending they are acting for the benefit of the environment in using PET kegs instead of traditional stainless steel kegs.

Large brewing groups are joining in these hymns of praise and introduce new packaging formats made from PET for the sake of higher profits by reaching the most remote spot on earth with their respective brands.

• Anheuser-Busch InBev unveils the “eco-friendly” and “sustainable” PureDraught keg (source: https://puredraught.com ), Completely made of plastic and intended to be thrown away.

• Carlsberg launches the DraughtMaster globally and explains to consumers that PET is “better for the planet”. The explanation given is the reduction in the amount of waste from 6 kg of environmentally harmful plastic waste compared to 29 kg of unproblematic glass bottles instead of reusable kegs. Carlsberg also makes it clear that it is about improving profitability, at the expense of the environment and mankind (source: www.draftmaster.com)

• Together with the German packaging system manufacturer Krones, Carlsberg built a high-performance filler for 500 PET kegs / hour in Frederica (DK), whereupon wellknown brands such as Holsten and Feldschlösschen are filled in 20 l disposable PET kegs. And according to Carlsberg “we would like to switch many more HoReCa businesses away from aluminum kegs to the containers for the draft master system,

4/6 as these are much easier to use” (source: www.krones.com/de/produkte /refers/hochleistungsmodus-bei-carlsberg.php)

• Heineken swamps the beer drinker community with Blade - The Machine, calling it environmentally friendly with a 100% recycling rate, but limiting that statement to the carton box only (source: www.heineken.com/ph/blade ).

• The German KHS AG has a global partnership with the industry giant Petainer to support global plastic production with the plant construction necessary for filling. (Source: https://competence.khs.com/en/022014-union-of-visionaries/strengththrough- cooperation

• As if that weren't enough, plastic producers now also focus on the wine industry. More and more winegrowers are filling their quality wine for export into cheap PET barrels instead of sustainable glass bottles or carton packs.

It looks like the forementioned steps are in the long-run neither beneficial for the environment nor for the industry as a whole. The brewing and wine making industry, whose roots are still in the production of a natural and often artisanal product, seems to be well advised not to risk its good image with questionable and unnecessary packaging. One has to ask: Where do we come from? Where do we want to go? And what can we do?

Generally speaking, beer and wine drinkers have many options to help protecting the environment with their purchase decision:

1. Draft beer has a better ecological balance than glass and can Beer drinkers can choose between a draught beer, a glass-bottled beer or a canned beer. From ecological perspective it’s the comparison of total CO2 emissions resulting from the return and handling of emptied containments vs. those during production and recycling of the same. But the equation for the total environmental footprint is complex 5/6 and it includes transportation distance, recycling rate and volume of the containment beside others. There might be an apparent feeling that stainless-steel kegs result in most cases with the most environmentally friendly footprint.

2. Avoid PET containers Beer and wine consumers always have the option to choose a drink from a stainlesssteel keg or from a PET containment. Modern tap-rooms offer all varieties of different packages, many from PET kegs. It should be worth for environmental concerned consumers to ask “what’s on tap in stainless steel kegs?” and to make their decision point clear. If nobody consumes beverages from PET kegs, the market will find its natural limits.

3. Prefer regionally produced beverages Finally and most obvious, all consumers should support local products from craft breweries or regional wineries. The carbon footprint for transportation is minimal, especially if they are using re-usable kegs or bottles and provide an excellent quality. It is a valuable part of intercultural exchange and experience. There is no elementary reasons to find my “home-beer” at the coast line of Australia.

What should politics do to curb the increase in plastic production?

1. The manufacturers of plastic packaging must be obliged to reuse or recycle plastic packaging at the end of its life in a demonstrably functioning manner.

2. Until this is fully implemented, a globally uniform deposit-refund system (DSR) based on full coverage of the real collecting and recycling costs would have to be levied, which is offset against the return at the collecting societies.

3. In other cases, a general ban on plastic one-way packaging should be considered if a more sustainable packaging system exists for the same packaging purpose and the use of plastic only serves to increase the profitability of the product. From today's perspective, this group would include PET plastic drums.

To prevent this, the beverage industry already has options today.

1. Voluntary return to classic reusable stainless steel barrels The beverage industry should return to established classical stainless steel kegs. The higher CO2 footprint caused by transportation is less imminent compared to the ecological disaster caused by PET. Consumers would accept a slightly higher price for a drink, which directly protects and preserves the environment, if it is dispensed in a sustainable way. For the beverage supplier this implies a higher bound liquidity in investing in its own keg fleet. The biggest suppliers for returnable kegs in the industry like AmericanKeg, Blefa, Schäfer or Portinox/Thielmann, but also smaller manufacturers such as A.E.B., Supermonte, Major or Penglai, could also support the initiative. They could agree on a worldwide standard for unbranded kegs to be used by all breweries evenly in all countries. This would reduce the carbon footprint even further as emptied kegs could be filled and used locally.

6/6 2. Pay-per-fill For slow-rotating markets or to cover peak demands, breweries could choose pay per fill solutions from MicroStar or KegFleet. They provide stainless steel returnable kegs, deliver on time and charge per fill without exhausting the liquidity of their clients. On the other side breweries enter long-term contracts with higher variable cost and have to cover the risk for losing kegs. Under the line, this is a pure financial option with no impact on the ecological balance compared with a returnable keg fleet. However, if breweries rely on external companies and they can’t deliver on time, they are left alone. Other problems arise, when such a service partner suddenly drops out of the market as could be seen in August 2020, when GlobalKeg, the biggest player in this market, filed for insolvency, leaving customers and suppliers behind.

3. One-Way kegs from stainless steel An option are one-way kegs made from stainless-steel, where a one-way logistic is reasonable from overall economical footprint consideration. These 2 kg lightweight containers combine the ecological and economic advantages with a recycling rate from over 98% and are made for more than 95% from stainless steel, which is harmless for the environment and oceans even for the rare occasion left behind. Additionally, and that should be the most important decision factor for breweries, wineries and consumers: Stainless-steel kegs preserve the highest product quality, genuine taste and flavor and keep the CO2 content stable during transport and dispense.

picture by www.worldkeg.com

In summary, consumers should enjoy their preferred beverage quality all over the world, with the good feeling having done something really good for the environment. And that means: Say no to plastic packed beverages. Now!

Cheers.

About the Autor: Daniel J.C. Grimm Dipl. Braumeister TUM Licenced vocational teacher and higher professional education Since 2001 auditor and consultant for Food-Safety (ISO 22000), Environment and Sustainability (ISO 14000) and process improvement (ISO 9001), trainer and coach in the food industry, Risk-Assessments, E-Learning-Specialist Contact: [email protected]

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