Packaging Forecasts for 2018: Applications, Processes, Sales, Tonnage

What will drive innovations in packaging for the next 10 years? Industry analysts at Smithers Pira say emotional engagement, connectivity, e-commerce, anti-counterfeiting, emerging technologies, brand and consumer demands, personalized experiences, and a rapidly evolving retail landscape.

They point to increased automation, short runs, quick response, exceptional graphics, and specialty inks and coatings as essentials when seeking to build new revenue streams and strengthen value adds. The common mission of flexographers and all other printing, packaging and converting professionals: “Make packaging more relevant to the end consumer, who ultimately determines the success or failure of brands and retailers.”

It’s all about shelf appeal, according to both Simon Ford and Dr. Sean Smyth, lead researchers at Smithers Pira. What’s being called for? “More color, as well as a wider range of finishing options that make packaging more interesting, interactive and inspiring.”

Assessing the priorities, the two market watchers and their teams list 10 top concerns—deemed “Disruptive Forces in Packaging”:

• Greater connectivity with consumers—packaging forms the bridge to online interaction
• Premium, personalized packaging
• Meeting tighter brand corporate sustainability targets
• Designing packs for e-commerce
• Adjusting transit packaging to dimension (DIM) weighting
• Integrating the latest generation of sustainable packaging materials
• Customization and co-creation of packaging
• Designing packs for optimal in-store location
• Adapting global brand packaging for transition market opportunities
• Engaging consumers in anti-counterfeiting

Forecasts compiled by Smithers Pira statisticians now indicate packaging demand will grow steadily at 2.9 percent to reach $980 billion in 2022. In 2017, the total value of packaging globally came to $851 billion. “Analog printing will fall globally through 2022, in value terms, in all print product sectors, except for packaging and labels. The strongest growth area for analog printing is in flexography, which is being driven by the growing applications. This print process is forecast to grow at a 2.5 percent compound annual growth rate (CAGR) through 2022 to reach a global market value of $186 billion.” That’s nearly 20 percent of the world’s volume—printed and non-printed combined.

Flexible Packaging

Findings in the full report on the evolving global packaging industry indicate the total market for consumer and industrial flexible packaging was almost $230 billion in 2017. Smithers Pira projects the market will grow at an annual rate of 4.3 percent, reaching a total value of $283 billion in 2022.

Speaking to volume, market watchers calculate consumer flexible packaging consumption will grow at an annual rate of 4.1 percent, increasing from 27.4 million tons in 2017 to 33.5 million tons in 2022.

Folding Carton

Smithers Pira says global demand for cartonboard used in folding carton and micro/mini-flute packaging applications is forecast to reach a market value of $124.1 billion by that same year. The value of the global cartonboard packaging market passed the $100 billion mark in 2016, and consumed more than 40.3 million tons of material in folding carton and micro/mini-flute packaging applications. CAGR is 4 percent.

Four technology advances are reshaping the folding carton market, according to the research team:

• New and innovative materials enabling environmentally friendly packaging
• Advances in printing technologies improving product shelf appeal and print turnaround times
• Anti-counterfeit and security measures—including RFID technology—creating new value-adding opportunities
• The development of coated folding carton grades to meet ongoing concerns over food safety

The continuous push toward eco-friendly materials gave rise to the introduction of non-conventional materials made from edamame beans, hazelnuts and cocoa beans.

Labels

Smithers Pira data shows the label printing market worldwide was valued at $35.7 billion in 2017, and will grow at 4.4 percent year-on-year to reach $43.8 billion in 2022. Across the same period, the volume of labels printed will rise to 1.41 trillion A4 sheet equivalents.

Further analysis of label formats reveals pressure-sensitive labels are the dominant product. These had a 58 percent market share by value in 2017. Above-average growth will see this increase progressively across the next five years. There will also be new demand for sleeves and in-mold labels, while the market share for wet-glue labels will fall.

Digital Print

Digital print for packaging was worth $13.2 billion in 2017 and will climb to $23.2 billion in 2022, according to Smithers Pira. As such, it represents a key growth area for the print industry, as well as opening new market opportunities for packaging converters and their brand customers.

This will see an 11.2 percent annual increase in value across the forecast period and annual 15.4 percent growth in volume output (A4 sheets equivalent)—up from 163 billion A4 sheet equivalents in 2017 to 334 billion in 2022, reflecting the arrival of new, higher-throughput equipment.

Penetration for digital print technology is not uniform. The labels sector is the early adopter and mature in some regions. Consequently, future expansion will rest heavily on less-developed packaging formats principally: corrugated board, folding cartons and flexible plastics.

Corrugated Board

Corrugated board packaging, as a market, will hit a value of $269 billion in 2021, according to Smithers Pira. “For the period 2009-2015, volume consumption of corrugated board grew on average by 4.3 percent annually. In the most recent two-year period, 2016-2017, it decreased to 3.6 percent annually.”

The organization’s report, The Future of Global Corrugated Packaging to 2021, states the actual consumption of corrugated board packaging by end users totaled 128.6 million tons in 2015, worth more than $222 billion to converters. “Ongoing penetration of internet shopping into consumer behavior is seeding a spate of innovation in the corrugated market, with companies taking on the challenge of what they term ‘frustration-free’ packaging, as well as corrugated producers designing clever ways of ensuring the safe transportation of goods via the postal service to reduce the cost of delivery by courier and enable easy returns.”

Analysts maintain, “The highest percentage growth in demand for corrugated board between 2016 and 2021 is expected to occur in the electrical goods industry, while the largest net incremental demand will be in the processed food market, as this has the highest base and will also see the most significant gain in market share over the forecast period.”

Editor’s Note: Information presented in this article was compiled from a host of recently issued Smithers Pira market data reports, namely: The Future of Global Packaging to 2022, The Future of Folding Cartons to 2022, The Future of Label Printing to 2022, Digital Print for Packaging to 2022, The Future of Global Corrugated Board Packaging to 2021, and 10-Year Forecast in Disruptive Forces in Packaging to 2027.