Exploring The Environmental Implications Of Potential Tariffs BY RACHEL KAGAN
As discussions continue around the United States proposed 25 percent tariffs on Canadian imports—including paperboard and cardboard—it’s important to consider not only the potential economic implications, but also the possible environmental implications. While these tariffs are still
under review, they raise questions about how trade policy may influence packaging decisions and busi- ness sustainability planning.
In this blog, the Paper and Paperboard Pack- aging Environmental Council (PPEC) explores the unintended environmental consequences of tariffs. While we do not take a position on trade policy it- self, we believe it is important to consider how such policies could impact sustainability efforts. So, what could all this mean for packaging, recycling, and sustainabil- ity planning? Could potentially higher costs for some types of packaging materials push businesses toward other materials that may be less recyclable? Could this uncertainty cause companies to delay or adjust their sus- tainability plans? If tariffs were to make certain materials—such as Canadian-produced recyclable paperboard and cardboard—more expensive compared to other materials, businesses may seek alternative materials. On a recent earnings call, Coca-Cola’s CEO James Quincey said that the beverage company could move to PET bottles for some products if aluminum cans were to become less affordable due to tariffs (on March 12, the United States started applying a 25 percent tariff on imports of steel and aluminum products from all countries, including Canada). It is worth noting that Quincey also said “we’re in danger of exaggerating the impact of the 25 percent increase in the aluminum price relative to the total system.” And when it comes to corporate sustainability goals, there has already been a slowdown in progress on various sustainability targets, with some North American companies highlighting difficulties in sourcing sustain- able feedstock and materials, and a lack of infrastructure for sorting and recycling. At a time when policymakers and businesses are working to improve recycling systems through Extended Producer Responsibility, with par- ticular efforts to reduce plastic, the unintended environmental impacts of tariffs should be considered. Our intention is not to exaggerate, but rather to explore potential implications from a sustainability perspective. It is possible that cost pressures could drive shifts in packaging materi- als, which could undermine efforts to reduce waste, particularly as they relate to Canada’s Zero Plastic Waste Agenda, the US National Strategy to Prevent Plastic Pollution, and the work being done to develop an inter- national legally binding instrument on plastic pollution. Additionally, the potential threat of tariffs creates an uncertain busi- ness climate that may make it more difficult to plan, which could impact or even delay progress or investments in corporate waste reduction and sustainability initiatives. While the US tariffs on Canadian paperboard and cardboard remain under review, the Canadian government has also identified potential CONTINUED ON PAGE 14 Rachel Kagan
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April 7, 2025
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