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Global growth to spur sales of machinery

John Kalkowski, Editorial Director -- Packaging Digest, 7/1/2010 8:45:00 AM


Packaging lineAs large as this country's economy is, it is just a microcosm of the global market for packaging machinery. Two recent studies highlight the fact that although the U.S. packaging market is the largest in the world, it has reached a level of maturity in which growth here will be slow.

Still, according to a study by Global Industry Analysts Inc., (GIA) the worldwide packaging machinery market is likely to exceed $40 billion annually by 2015. Current annual packaging equipment sales worldwide are about $38 billion, according to the Confederation of Packaging Machinery Associations, while the most recent report by the Packaging Machinery Manufacturers Institute (PMMI) placed the size of the U.S. equipment market at just under $6 billion for 2008.

Meanwhile, a Freedonia study says that China's packaging equipment market alone should grow about 8.7 percent annually over the next four years. As both studies point out, packaging industry growth can be attributed primarily to increasing consumption and higher disposable incomes in developing countries. Even in countries with very low labor costs, packagers are installing equipment with enhanced automation and integration, remote diagnostics, and modularity. GIA reports that increasing use of servos, networking architectures and robotic applications are growing trends as companies worldwide work to reduce lead times and curtail frequent replacement of equipment.

At least for the China market, filling and form/fill/seal equipment will remain the largest product segment for packaging machinery. However, strongest growth will be in the labeling and coding equipment, with this demand created by increasing requirements for transparency and traceability throughout the supply chain due to concerns about the safety of food, beverage and drugs originating there.

Paula Feldman, research director of PMMI, points out that German and Italian machinery makers are aggressively pursuing these developing markets in Asia, Latin America and the Middle East. She adds that the opportunity is not lost on hometown manufacturers, either. Equipment builders in China, India, Korea and Thailand are grabbing shares not only of their own country's business but they also are exporting to other countries.

U.S. packaging equipment manufacturers would be wise to grasp this opportunity, too. There is an old business maxim that says, "A business that is not growing is dying." As Ryan Oklewicz, PMMI global marketing manager, points out, PMMI has several programs to help U.S. manufacturers extend their sales in other countries and keep their own trajectory moving upward.


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