IKEA’s biggest retailer funds Chinese food packaging recycler

Ingka Group is backing Shanghai-based plastics recycler Re-mall as part of a planned $1.16 billion investment in companies that can help IKEA’s largest retailer meet its goals of repurposing and reusing more materials in the products it sells.

The move is Ingka’s first in support of a circular economy infrastructure company in China, one of the world’s largest markets for plastic waste. 

Re-mall, founded in 2015, specializes in producing high-quality post-consumer recycled propylene from food packaging, which is notoriously difficult to process because of the organic residue left on it. Its production facility is in Jiangxi province, a hub for plastic waste streams from Shanghai and Guangzhou.

The plastic pellets and materials Re-mall creates can be used in many products, including toys, tableware, cosmetics packaging and woven textiles. The company is building closed-loop relationships with its biggest customers — collecting materials from those brands before feeding recycled materials back into their supply chains. 

“Re-mall’s strong supplier network and partnerships with leading Chinese food delivery service providers are already allowing it to create impact at scale in the local recycling market,” said Lukas Visser, head of circular economy investments at Ingka Group.

Ingka’s backing — the amount of which is undisclosed — is characterized as growth capital that will expand its commercial capacity.

Source: Ingka Group

The bigger picture

Ingka’s climate transition strategy includes cutting the carbon footprint of product end of use, which accounted for 1.6 million metric tons of greenhouse gas emissions in 2024 — 7 percent of the total. 

The absolute amount is down 15 percent from 2016, the year Ingka uses as the baseline for its goal of halving emissions by 2030. Ingka also intends to become “fully circular” by the end of the decade.  

Ingka Investments announced its $1.16 billion (1 billion euros) investment plan in January. Re-mall is the fourth publicly disclosed company in its portfolio. The others, all European, are:

• RetourMatras, a mattress recycler that processed more than 1 million mattresses in four facilities in 2024, avoiding an estimated 90,000 tons of carbon dioxide equivalent emissions (tCO2e). RetourMatras sells recycled material to customers such as IKEA to use in new production. 
• Morssinkhof Rymoplast, which handles high-density polyethylene, low-density polyethylene, polyethylene terephthalate and polypropylene plastics. Ingka acquired a 17 percent stake, helping to double Morssinkhof’s capacity.
• Next Generation Group, which provides equipment to the plastics recycling industry. 

In its latest environmental progress report, Ingka estimated that these ventures have so far recycled approximately 1.9 million metric tons of materials, avoiding 5 million metric tCO2e.