World Economic Forum 2026: Collaboration launches US$2B next-gen packaging initiative

At this year’s World Economic Forum in Davos, Switzerland, non-profit Canopy and partners introduced a new finance model designed to accelerate the growth of low-carbon materials, aiming to transform the paper, packaging, and textile supply chains. 

Valerie Langer, strategic lead for Next Generation Solutions at Canopy, tells us how the investment model drives sustainability in the packaging industry and how companies can overcome challenges in supply chain decarbonization. 

“The US$2 billion investment program is a blueprint for scaling up the manufacturing capacity of pulp for paper in India, using lower carbon alternatives to trees as the input,” Langer tells Packaging Insights. 

“A huge share of packaging today is still tied to conventional wood pulp — and the scale is staggering. Around 3.1 billion trees are logged every year for paper packaging, with too much of that coming from forests that are critical for climate stability and biodiversity.”

“When these landscapes are logged, it releases massive emissions and removes one of our most effective carbon sequesters: standing, living trees.”

Next-gen packaging 

Low-carbon packaging materials can be made from agricultural residues. These materials, like wheat straw, and sugar cane bagasse, are often burned on the field or dumped, creating methane pollution.

Langer notes that these low-carbon materials can be an alternative source of cellulose fiber.

Langer (in the center) met with industry experts to launch the biomaterials project in Davos.“Scaling next-gen pulp for paper delivers multiple benefits: it diversifies the fiber options for paper mills, which strengthens supply chain resilience in a world where climate change is increasing forest fires in plantations and natural forests.”

“Additionally, it cuts Scope 3 carbon emissions for brand customers, and it has a lower footprint than forest fibers for biodiversity, land use, water, and energy.”

“The investment program, anchored by a blended finance platform that will attract additional co-financing, will bring those much-needed solutions to market at scale.”

Mitigating sector risks 

The investment program is being structured with the input from a range of stakeholders and experts, with the aim of bringing the first round of funds within 24 months.

While the project starts in India, Langer says the impact of the investment program is designed to go beyond one country. 

“Canopy is starting in India because it has the ingredients to scale quickly — abundant feedstocks and industrial capability to move from concept to large commercial volumes. But the intention from day one is to build a replicable blueprint that other regions can adopt and adapt for their context.”

“For packaging, that matters because today reliance on a single virgin feedstock input — wood — exposes the sector to several risks — supply risks from forest fires and emerging regulations forbidding imports of products made with wood from deforestation or forest degradation, and increasing competition for the limited supply of wood that meets sustainability requirements and price increases as these factors play out over the next decade.”

“Scaling next-gen and circular fiber expands the fiber basket, reduces concentration risk, and gives brands and converters more stable sourcing options as regulation tightens and climate disruption grows. The long-term effect is a faster, more credible pathway to lower carbon packaging materials — not as a niche product line, but as part of the mainstream supply mix.”

Harnessing pulping tech 

India is well-positioned to build up next-gen pulp and paper capacity as it has abundant crop residues and paper engineers comfortable working with these inputs, according to Langer. 

“The investment of US$2 billion will enable approximately 1.5 million metric tons of next-gen pulp mill capacity to be built or retrofitted. This will fully establish the feedstock supply systems and confidence the market needs to kickstart further investment to achieve more than 10 million tons of capacity within a decade.”

Canopy has calculated that around 60 million tons of pulp currently originates from high-carbon and biodiversity value forests around the world. 

Although wood will continue to be a significant part of the paper supply, Langer suggests that substituting that pulp with a lower environmental impact alternative will have significant environmental benefits, alongside positive health benefits by reducing the burning of millions of tons of crop residues. 

“Approximately 150 people die each day in India from the impacts of this pollution. Additionally, there are rural economic development benefits — farmers can sell to mills what they otherwise would burn on the field, and mills provide rural manufacturing jobs.”

“Globally, some 500 million tons of crop residues are burned annually. The program in India will provide proof of concept at commercial scale, using some tried and true pulping tech with a few cleaner and greener processing elements added (for example, for energy and water efficiency) and bringing some of the new biorefinery technologies into commercial scale production as well.”