Learn to Recycle — APCO Australian Packaging Covenant Organisation

What is APCO?

APCO – Australian Packaging Covenant Organisation – is a non-profit organization jointly established by the government and the industry.

Its main goal is to promote the sustainable development of the national packaging industry.

Core roles of APCO:

• Setting industry goals:
  Leading the achievement of Australia’s “2025 National Packaging Targets”, including 100% of packaging being recyclable, reusable, or compostable.
• Providing tools and standards:
  1. Such as the Sustainable Packaging Guidelines (SPGs), which help businesses design more environmentally friendly packaging.
  2. The PREP tool for assessing packaging recyclability.
  3. The Australasian Recycling Label (ARL) guides consumers in proper recycling practices.
• Promoting industry collaboration:
  Bringing together brands, retailers, packaging suppliers, governments, and recycling enterprises to jointly advance the development of a circular economy.

APCO is an environmental supervision and collaboration organization in Australia’s packaging industry.
It helps enterprises reduce packaging waste, improve recycling rates, and guide consumers to properly recycle packaging through standards, tools, and labeling systems.

2025 National Packaging Targets of APCO

APCO’s focus includes laying the foundational groundwork for achieving Australia’s 2025 National Packaging Targets—an essential pathway toward building a circular economy for sustainable packaging.

• 100% of packaging to be reusable, recyclable, or compostable:
  All packaging should work in a circular way—either get used again, be recycled into new things, or break down naturally (compostable). This means less waste ends up in landfills!
• 70% of plastic packaging recycled or composted:
  We want most plastic packaging to be recovered—either recycled into new products or composted (if it’s designed for that). It helps cut down plastic pollution.
• 50% average recycled content across all packaging:
  More packaging will use materials that were already recycled (like recycled plastic or paper). This reduces the need to make “new” materials from raw resources.
• Phase out problematic and unnecessary single-use plastic packaging:
  We’ll get rid of single-use plastics that are harmful (hard to recycle, or damaging to nature) or just not needed. You’ll see less of these plastics in stores!

What are the National Packaging Targets (NPTs)?

Think of them as Australia’s big promise to make packaging better for the planet. The goal?
To switch to a “circular economy” for packaging—meaning we reuse, recycle, or compost packaging instead of just throwing it away.
These rules apply to all packaging used and sold here, from chip bags to cereal boxes!

Who’s in charge?

That’s where APCO (Australian Packaging Covenant Organisation) comes in.
They’re like the “team captain” working with businesses, the government, and everyone involved in making/using packaging.
Their job? Make sure we reach these eco-friendly goals!

The 2025 Deadline Update

At first, we hoped to hit all these targets by 2025. But… It’s tough! We’re not quite there yet.

BUT—don’t worry! APCO and partners are still working hard to speed things up. A new deadline will be set, and we’ll keep pushing to make packaging greener. Every small step (like recycling right, choosing reusable options) helps reach these goals faster!

APCO leads the charge, 2025 is tricky to hit, but progress continues—and your eco-choices matter too!

APCO MATERIALS COMPATIBILITY

Under the APCO (Australian Packaging Covenant Organisation) framework, “materials compatibility” refers to the recyclability of packaging materials within Australia’s recycling system—specifically, whether packaging materials and their combinations can be effectively recycled by existing sorting, processing, and recycling infrastructure.

• Compatible Materials:
  1. Widely accepted by recycling facilities across Australia;
  2. Correctly identifiable by standard sorting equipment;
  3. Supported by a mature recycling market.
• Incompatible Materials:
  1. Excessively composite structures or multi-layer materials that cannot be separated;
  2. Additives that are difficult to identify or contaminate the recycling stream (e.g., carbon black);
  3. Partial components (e.g., metallized coatings, PVC, PS) are not accepted by recycling facilities.

Assessment Tool: PREP (Packaging Recyclability Evaluation Portal)

APCO provides the PREP tool to test the recyclability of packaging.
Evaluation parameters include:

• Material type and combination;
• Impact of adhesives, inks, and coatings;
• Separability of labels and lids;
• Accessibility of recycling facilities.

Australasian Recycling Label (ARL)

Through PREP assessment, packaging can obtain the Australasian Recycling Label (ARL), which indicates on the packaging:

• Recycle;
• Conditionally Recyclable;
• Not Recyclable.

Materials that comply with APCO guidelines are typically single-material, easy to separate, and free of hard-to-process additives.

The Australasian Recycling Label (ARL) is a packaging labelling system used in Australia and New Zealand, designed to provide consumers with easy-to-understand information about packaging recyclability.
This system eliminates confusion around recycling, saves time, and reduces contaminants in the recycling stream.

2030 Strategic Plan

The APCO 2030 Strategic Plan was unveiled on August 19, 2024.

Key Goals

The core goals of the APCO 2030 Strategic Plan are to drive the transformation of Australia’s packaging industry toward a circular economy through economic incentives and systemic reforms.

• Increasing recycling: It directly supports high-quality collection, recycling, and packaging stewardship activities to help achieve recycling targets and produce high-quality Australian recycled materials.
  1. Directly supporting recycling system upgrades:
     The plan invests in strengthening high-quality collection, sorting, and recycling capabilities—for example, funding recycling infrastructure and optimizing sorting technologies—to achieve a 70% plastic packaging recycling rate and 50% recycled material usage in packaging by 2030.
  2. Eliminating economic barriers to recycling:
     The newly introduced eco-modulation membership fee model will tier fees based on packaging recyclability—with higher fees for harder-to-process packaging (e.g., multi-layer composite plastics). This mechanism directly pushes brands to redesign packaging, such as switching colored caps to transparent HDPE to improve recycling purity or adopting biodegradable alternatives.
• Reducing landfilled materials:
  1. Setting clear reduction targets:
     In addition to the national packaging targets, new indicators will be used to track the goals of the covenant, aiming to reduce the amount of materials sent to landfills by 1 million tonnes by 2030.
  2. Promoting the phase-out of single-use plastics:
     The plan collaborates with governments to accelerate the elimination of problematic single-use packaging (e.g., polystyrene food containers) and uses economic levers to encourage brands to shift to reusable models.
     For instance, Woolworths’ B2B reusable crate system has demonstrated that such designs not only reduce waste but also optimize costs through RFID tracking.
• Meeting social expectations:
  Ensure that brand owners have a supportive system to meet the community’s expectations for packaging design and disposal, and obtain a “social licence” to operate in Australia.

   

  1. Building a social license support system:
     The plan requires brands to disclose full-lifecycle packaging data (e.g., carbon footprint, recycling rates) and enhances consumer transparency through tools like the ARL label.
     It also establishes community engagement mechanisms, such as incorporating the needs of vulnerable groups (e.g., people with disabilities) during the design phase to ensure packaging aligns with social ethical expectations.
  2. Aligning with national policy frameworks:
     The strategy is highly synergistic with Australia’s National Plastics Plan and National Waste Policy.
     For example, it supports the government’s implementation of Extended Producer Responsibility (EPR) legislation, requiring businesses to shift from a “produce-and-discard” model to “full-lifecycle responsibility,” including compensation mechanisms for recycling failures.

Fund Use

The funds raised through the new fee model will be invested in the downstream system, used to support end-markets, build reprocessing infrastructure, and strengthen collection networks, so as to overcome the economic barriers that have hindered the progress of national packaging targets.

• Economic incentives and resource redistribution:
  Funds raised through the eco-modulation fee model will be directed toward recycling technology R&D, recycled material market development, and regional recycling network expansion.
  For example, investments in flexible plastic recycling facilities have helped Australia increase its recycling rate from 20% in 2022 to 35% in 2025, with a target of 70% by 2030.
• Cross-industry collaborative innovation:
  The plan promotes the establishment of “Collective Action Groups (CAGs)” comprising brands, manufacturers, and governments to jointly develop material-specific roadmaps (e.g., for fiber, glass, and metal) and unify design standards through Sustainable Packaging Guidelines (SPGs), ensuring packaging is recyclable from the source.

Guiding principles

According to the relevant roadshow, the strategy of APCO is based on four basic principles, namely, transforming the packaging value chain, closing economic gaps, encouraging brand owners to take fair and efficient responsibilities, and enhancing the government system with a single administrator.

How can KDW help you?

In the global shift towards a circular economy for the packaging industry, we recognize that you face dual challenges: meeting consumers’ expectations for eco-friendly packaging while complying with mandatory requirements, such as APCO 2030, which call for increased recycling rates and reduced landfill waste.
As your flexible packaging partner, we are committed to breaking the dilemma between “environmental protection and performance” through material innovation.

The primary pain points of recycling flexible packaging often stem from its complex, multi-layered structures.
We have reconstructed material systems from the source to ensure that eco-friendly packaging no longer compromises functionality:

• Single-Material Alternative Solutions:
  For high-frequency use scenarios such as snack bags and sauce packaging, we offer all-PE / all-PP single-layer flexible packaging.
  This packaging is fully compatible with Australia’s existing plastic recycling and sorting systems and can obtain the “Recycle” label through PREP assessment.
  Compared with traditional PET/AL/PE composite films, the recycling rate of this material has increased by over 60%.
• Recycled Material Integration Technology:
  Leveraging a stable post-consumer recycled material ( PCR ) supply chain, we can provide flexible packaging solutions containing 20% – 50% recycled content, directly helping you meet APCO’s target of “50% recycled material usage”.
  All recycled materials have passed food contact safety certification, and we provide complete traceability reports to support your ESG information disclosure.
• Scenario – Specific Degradable Options:
  For scenarios where packaging is difficult to enter the recycling stream, such as fresh food preservation bags and disposable takeaway bags, we offer compostable flexible packaging compliant with ASTM D6400 standards.
  It is clearly labeled as “degradable under industrial composting conditions” to avoid polluting the recycling system.

Driven by policies such as APCO 2030, the sustainable transformation of flexible packaging is no longer an option but a must for long-term business development.

We are ready to be your solid partner in achieving environmental goals with professional material technology, customized design solutions, and full-chain collaboration capabilities — ensuring that every packaging product not only protects product quality but also integrates into the circular economy, helping your brand gain policy recognition and consumer trust.

Looking forward to joining hands with you to turn flexible packaging from an “environmental burden” into a “resource asset”!