- Global packaging industry by packaging material type
- Emerging trends in the paper and board packaging industry
Global packaging industry
The global packaging industry has a significant value addition to the global supply chain and the current industry size is estimated at ~$850 billion (2017). The industry is classified into two major types, which is based on the structural properties of the packaging material, that is, rigid and flexible packaging. The industry has evolved over the years and the earliest use of packaging was estimated to have begun as early as 1200 BC. The global packaging industry has four major material types, which are paper and board, plastic, glass and metal packaging. The types of packaging are also differentiated on the basis of their interaction with final consumers and the purpose of the packaging products, which includes primary, secondary and tertiary packaging.
Packaging demand by end-user industries
The largest end-user industries for the global packaging demand arises from food, beverages, consumer products and industrial/bulk packaging. The largest consumption demand for both the primary and secondary packaging emerges from food, beverages and consumer products packaging, whereas industrial and bulk level packaging (tertiary packaging) is consumed by all the major manufacturing industrial sectors globally and thus, forms the largest demand consumption for packaging in the global economy. In 2017, the food packaging industry had a significant market size of ~$243 billion, while the beverage packaging industry had a market size of ~$84 billion. The consumer product packaging, which includes products that are for direct use by the end-users excluding food and beverages can be segmented into four major groups, which are personal care, health care, tobacco and other consumer products. The packaging market size of these combined consumer product industries was estimated at ~$159 billion in 2017. Further, industrial/bulk packaging is the largest segment of the packaging industry, which had a total packaging consumption demand of ~$375 billion in the same year.
In Televisory’s report titled the ‘Global Paper & Board Packaging Industry’, an in-depth analysis was conducted on the present demand-supply balance in the paper and board packaging industry and an assessment of the projected demand from the key end-user industries was performed. The industry structure was also analysed and the emerging industry dynamics, which has the potential to disrupt the currently established packaging value chain was assessed for their impact on the outlook of paper and board packaging industry.
Global paper and board packaging industry
The paper and board packaging industry form ~43% of the total packaging industry, with a market size of $369 billion (2017). The share of paper and board packaging against the total packaging consumption has throughout been maintained at or above 40% in the recent history and has remained resilient despite the emergence of other packaging materials. This is attributed to certain properties of paper, for example; premium appeal, recyclability, lightweight, cost-effectiveness, etc. Although paper packaging serves both the rigid and flexible segments including products like paperboard, carton board, paper bags, liquid carton, etc. However, the majority of demand share is contributed by rigid packaging.
The global paper packaging industry is a sub segment of the pulp and paper industry, for which the key raw material is fibre. This is primarily sourced from wood and recovered paper and the demand for fibre furnish has reached 415 million tonnes, which grew at a CAGR of 0.6% over 2017-17. The demand for fibre has been increasing on account of the ongoing shift in the global paper industry, which has been undergoing a transition towards a high use of paper in packaging and sanitary uses, with a declining trend in the demand for newsprint and printing and writing paper (P&W). The P&W paper and newsprint contributes around 30% of the total paper demand, in contrast, the packaging and sanitary paper demand contribute 70%. Furthermore, the demand for packaging paper stands at 235 million tonnes and achieved a CAGR of 2% during 2007-17. Asia Pacific is the largest consumer of packaging paper since China overtook the US in terms of the total packaging paper demand in 2008.
The growth story of the paper packaging industry has seen different dynamics in the large economic regions of the world. The Asia Pacific region has been the major growth driver during the 2000-17 period due to its rapidly growing consumer demand. The dynamics of the Asia Pacific region were highly supportive for the growth of the paper packaging industry as the region houses more than 60% of the world’s population accompanied by a relatively low base of per capita consumption.
Emerging trends in the paper and board packaging industry
However, the paper packaging industry has seen some major regime shifts during the recent periods that are creating opportunities and threats in the industry. These include the waste paper import ban in China, global restrictions on single-use plastic, deforestation and the emergence of e-commerce. Moreover, rising awareness among consumers towards eco-friendly and sustainable packaging options along with growing hostility towards plastic has led to a sustainable demand for paper and board packaging. The conclusions drawn are therefore supportive of a continued expansion of the paper packaging demand globally, especially in the high growth regions of the world.
Televisory has projected the growth outlook of the paper packaging industry on a global and a regional level. We followed a multi-factor approach to project the demand outlook for paper packaging since the consumption of packaging is dependent upon the growth in the end-user industries. Televisory also incorporated qualitative factors that are emerging in the global packaging industry, which include consumer lifestyle factors and supply-side trends. Thus, based on the above factors, a conclusion was drawn that paper and board packaging will outperform the global packaging industry during the forecast period of 2018-22.
The company section of the report covers some of the world’s largest paper and board packaging companies, which are as follows:
1. Mondi Plc
2. International Paper
3. DS Smith Plc
4. Oji Holdings Corporation
6. Smurfit Kappa Group Plc
7. Nine Dragons Paper Holdings Ltd.
8. Asia Pulp and Paper (PT Indah Kiat Pulp & Paper Tbk)
9. Mayr-Melnhof Karton AG
10. Packaging Corporation of America
In order to gain a deeper understanding of the global paper and board packaging industry dynamics, please subscribe to Televisory’s report on the ‘Global Paper & Board Packaging Industry – Outlook 2022’, on its website: https://www.televisory.com/specialReports