AF&PA demands California pause SB 54 implementation to protect established recovered fiber markets

A New Chapter in the Regulatory Battle

The American Forest & Paper Association (AF&PA) has significantly escalated its opposition to California's sweeping packaging legislation, SB 54. Following the initial legal challenge launched earlier this month by a coalition of 21 industry associations, the AF&PA is now pushing a highly specific narrative: the state is fundamentally misclassifying paper and corrugated cardboard by subjecting them to the same regulatory burdens as hard-to-recycle materials.

Julie Landry, Vice President of Government Affairs at AF&PA, has drawn a clear line in the sand. The association is formally urging California to pause the implementation of the Extended Producer Responsibility (EPR) law. The core argument rests on the premise that a one-size-fits-all approach to packaging regulation ignores the practical realities of the recycling ecosystem and threatens to disrupt well-established recovered fiber markets across the United States.

The Danger of Equating Paper with Plastics

The central debate surrounding this escalation is whether highly recyclable materials should receive the same regulatory treatment as those with historically low recovery rates. In 2025, the U.S. paper recycling rate hovered between 61% and 65%, while corrugated cardboard achieved recovery rates exceeding 70%. Despite these figures, SB 54 imposes new compliance costs and design mandates that fail to differentiate between a highly circular paper mill infrastructure and the struggling systems managing alternative substrates.

According to Landry, the legislation "gets paper wrong" by imposing new costs without actually improving paper recycling. The industry has spent decades investing billions of dollars into mill infrastructure capable of processing recovered fiber, optimizing product design for recyclability, and supporting nationwide collection systems. By ignoring these established frameworks, SB 54 risks creating severe market uncertainty for both manufacturers and consumers.

Market Implications for Recovered Fiber

For the corrugated and packaging sectors, the implications of SB 54 extend far beyond compliance paperwork. The recovered paper market relies on a delicate balance of supply, demand, and efficient collection infrastructure. If California enforces opaque product and packaging design requirements without acknowledging the existing efficiency of Old Corrugated Containers (OCC) and mixed paper recovery, it could artificially inflate the cost of fiber-based packaging.

• Cost Increases: Unnecessary EPR fees applied to already highly recycled materials will likely be passed down the supply chain.
• Infrastructure Disruption: Mandates that conflict with current mill processing capabilities could force costly, non-value-added operational changes.
• Market Uncertainty: Ambiguous definitions of "recyclable" under the new legal framework threaten to destabilize the steady flow of recovered fiber required by domestic mills.

The AF&PA's demand to pause the law is a strategic move to force regulators to scrutinize the unintended consequences of SB 54. The association advocates for a policy framework that is practical, fair, and focused on actual environmental outcomes rather than blanket penalization.

The Paper Angle: Rewarding Circularity

The ongoing litigation, specifically the efforts to add SB 54 challenges to the existing CLFP v. Bonta lawsuit, highlights a critical friction point in modern environmental policy. Regulators are increasingly eager to pass comprehensive packaging laws, but they often lack the nuance required to protect industries that have already achieved circularity. The paper industry's frustration is palpable and justified: why should a material that forms the backbone of the global recycling system be penalized to subsidize the recovery failures of competing materials?

As the legal proceedings unfold throughout 2026, the outcome will likely set a precedent for how other states draft their own EPR frameworks. If California is forced to amend SB 54 to recognize the distinct advantages of paper and corrugated packaging, it could pave the way for tiered regulatory systems that reward historical investment in recycling infrastructure.

The AF&PA's proactive and firm stance is a necessary defense of the industry's proven circularity, ensuring that future EPR frameworks reward rather than penalize successful recycling models. Will regulators eventually design tiered EPR systems that differentiate materials based on their historical recovery performance? Follow The Paper for daily news, market signals and key updates from the global paper, corrugated and packaging industry. — Sigue toda la actualidad del sector en www.thepaper.ai