AKRON, OH—Flexible plastic, paper and foil packaging will continue to see a steady rise in demand across the next five years, according to the latest dedicated market analysis from Smithers, The Future of Global Flexible Packaging to 2026.
It pegs worldwide consumption at a projected 31.5 million tons in 2021. This follows a 5.5 percent drop in overall value in 2020, a response to the global pandemic.
Smithers forecasts that demand will return through 2021, as lockdown (shelter-in-place) orders are lifted and international trade flows resume. Flexible packaging will benefit directly from this, and analysts forecast a compound annual growth rate (CAGR) of 3.4 percent, by volume. This will see total consumption reach 37.5 million tons in 2026.
Consumer packaging applications remain the bright spot, led by food packaging, which represents approximately 75 percent of consumption and has previously shown itself resilient in times of economic downturn. Moves to control the virus support wider calls for medical device and pharmaceutical packaging.
“Flexible plastics (BOPP, CPP, BOPA, BOPET, PE, PVC, EVOH, RCF) remain the largest segment and will see the fastest growth,” market watchers explain. “These have come under scrutiny as governments and consumers show a greater interest in the environmental impact of packaging.”
Flexible polymer constructions—especially multi-layer laminates—have been identified as among the hardest formats to recycle efficiently, according to Smithers researchers. “In response, material suppliers and converters are introducing more monomaterial packs, designed to be recovered in existing waste streams.” They continue, “This is driving R&D on delivering performance characteristics previously only possible with multi-layer constructions, such as improving high-speed heat sealing, withstanding retort cooking, and home ovenable pouches.”
Emphasizing another point, the team says, “In parallel, the industry is investigating how to use more recycled post-consumer resin in polymer packaging films, and in particular investigating the wider use of feedstocks, sourced from the first generation of chemical recycling processes.”
Turning to retail packaging, it notes, “There is more interest in flexible paper concepts, including new barrier concepts and designs. These are allowing brands to demonstrate their green credentials to customers.”
While maintaining production and safety during COVID-19 was the top priority for 2020, sustainability has not disappeared from the medium-term agenda.
Smithers acknowledges, “Many food marketing consumer group companies are maintaining corporate citizenship commitments to improve the sustainability of their packaging by 2025 or 2030, and many state government recovery strategies are looking to match spending to projects that minimize environmental impact.”
Elaborating on the point, researchers state, “Elements of these have the potential to benefit flexible packaging, especially those focused on minimizing food waste, where the ambient barrier performance of the latest flexibles can be a key tool to minimize spoilage of perishable foods in transit.”
Trends + Impact
Threats and opportunities prompt comment from analysts. Specifically, the team says that should any country or region experience an economic recession stemming from lockdown, it will cause a decrease in demand for more premium products, as disposable income decreases. “Duration will depend on the success of national virus control and vaccination programs, as well as the effectiveness of government stimulus spending.”
While Smithers indicates that population growth should exert a large impact on packaging demand to be able to meet growing population numbers, it maintains that the aging population will carry a medium impact, as the senior demographic increases. The expected result: increased demand for health care and easy-open packaging.
Urbanization, Smithers observes, is starting to impact the packaging market with demand for convenience packaging and smaller pack sizes. Similarly, single-person living continues to drive calls for convenience packaging and smaller pack sizes. Urbanization and busier lifestyles are increasing the need for on-the-go consumption. This will result in demand for packaging that meets it.
Other points of note:
- Safety was a priority over the sustainability of packaging in 2020
- The packaging market is focusing on consumer understanding of food waste and expiration dates
- More products are being purchased online, increasing e-commerce packaging
- Financial insecurity and more online shopping are resulting in fewer premium products being purchased
- Consumers are becoming more focused on health and wellbeing, resulting in an increase in demand for health care products
- Potential for material shortages and uncertainty, due to COVID-19, is causing fluctuation in prices, and demand for resin
- Legislation increasing restriction on use of chemicals, solvent recovery, single-use and producer responsibility continues driving pack substitution:
- Pouches are replacing glass jars
- Secondary packaging is moving to carton board
Editor’s Note: The Future of Global Flexible Packaging to 2026 quantifies the market (by value and volume) for 10 different flexible packaging materials across 2016-2026. Market data is presented in unparalleled detail, segmented across 19 end-use applications, and more than 20 regional and leading national markets. Comprehensive forecasts for the post-COVID-19 recovery are supported with critical analysis of how the virus’ impact and other economic, demographic and technical factors will reshape the market over the next five years.