David Bellm

January 30, 2014

3 Min Read
Growth in world flexible packaging to slow to 3.2%

A new report from PCI Films Consulting Ltd analyzes the effects of the global recession on the flexible packaging industry and identifies the market trends that will drive growth in the future.  It concludes that there will be a slow down in world growth but that the recession will have only a minor influence on future markets.

PCI forecasts that the US$58 billion world converter supplied consumer primary flexible packaging market will grow more slowly in value terms from an average of 5.9 per cent per annum over the last 3 years, to an average of 3.2 per cent per annum in the period to 2013.  

Their report notes that the economic slowdown caused by the world recession has had an effect on consumer flexible packaging demand in 2008 and 2009 but as food packaging is the main end use, the industry has not suffered as much as others.  More important have been cost-reduction programmes by major end users; the down-gauging of substrates; the reduction in the number of flexible packaging layers used; packaging waste reduction initiatives at local and government levels; and a slowdown in consumption due to ‘healthy eating’ campaigns in major end uses such as snacks, confectionery and biscuits.

However, PCI highlights a number of very positive trends throughout the world which will continue to push up the volume and the value of flexible packaging in use.  In all regional markets, flexible packaging producers are helping to reduce the volume of packaging waste by replacing glass bottles, blown and injection-moulded containers, aluminium and tinplate cans and carton board packages with lighter weight flexible alternatives.  In some cases this also means that packers can reduce their carbon footprint.  

In addition, the on-going development of food processing and retailing industries in countries with currently little packaging use is expected to result in greater flexible packaging to meet the needs of consumers with higher levels of disposable income.  
Overall, in value terms, over the next five years the downward pressures are expected to outweigh the positives, hence a slowdown in the average per annum growth rate.  

As the result of a significant slowdown in the more mature markets, the world will also see the emergence of Asia ahead of North America and Western Europe as the world’s largest regional flexible packaging market by 2013.  The report goes on to suggest that the Peoples Republic of China will on its own account for 10 per cent of global demand while India will become a significant producer and consumer of flexible packaging materials as well.

PCI’s report goes on to investigate trends in the supply chain and notes the emergence of a number of truly global players within the converting industry.  Through acquisitions and organic growth, a small number of companies are fulfilling multi-national customers’ needs worldwide.  

Paul Gaster, report author comments, “We could be seeing the emergence of an industry experiencing slower growth and in the hands of fewer yet larger multinational consumer flexible packaging organisations”.


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