Market Trends of Asia Pacific Paper Packaging Industry
Food Segment to Hold Significant Market Share
- The rise of new food and beverage companies and the significant growth of food delivery giants like Zomato and Swiggy have spurred a heightened demand for paper and packaging in India. As a result, the consumption of food and beverage packaging has surged. Notably, Zomato pioneered the introduction of tamper-resistant packaging in the food delivery realm, underscoring its commitment to food safety and freshness.
- Food packaging has evolved considerably, prioritizing brand visibility while ensuring the food item's integrity and quality. Local manufacturers fiercely compete, not only among themselves but also against multinational corporations (MNCs). To stay ahead, many have established dedicated research and development departments focused on testing and implementing cutting-edge technologies and prioritized their sustainable packaging, creating market growth opportunities.
- In the food processing industry, packaging materials are chosen based on the customized requirements of each food product. Key factors guiding these choices encompass thermal sealability, process capability, printability, strength, and barrier properties (such as resistance to water, oil, and gas). Research and development efforts among stakeholders in the paper packaging market bolster these considerations, aiming to elevate the properties and aesthetics of packaging.
- Furthermore, in China, decision-making is significantly influenced by cost-efficiency, sustainability, and adherence to legal regulations. In China, paper constitutes a significant segment of the food packaging market. Leveraging its unique advantages, paper is predominantly employed in food packaging to safeguard food products, enhance convenience during storage and consumption, and convey essential information to consumers, including marketing details.
- The food delivery industry in Japan predominantly relies on paper-based products driven by consumer awareness of sustainable packaging. This trend is part of a broader movement within the packaging sector to embrace paper. Additionally, as online food delivery gains traction in countries like China, food companies prioritise paper-based packaging solutions, further bolstering market growth.
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India is Expected to Hold a Significant Market Share
- The paper and paperboard industry has been registering significant opportunities and challenges during a transition phase to offer more affordable alternatives. The paper mills in India are actively experimenting to produce paper and paperboard tailored for various applications, including carrying, protecting, wrapping, packaging, and serving as containers. Additionally, in recent years, India has witnessed a surge in demand for upstream paper products, including tissue paper, tea bags, filter paper, lightweight online coated paper, and medical-grade coated paper.
- The restrictions on physical movement, social distancing, and the closure of physical stores during the COVID-19 pandemic impacted a significant surge in online orders for the Indian e-commerce industry. Across the nation, individuals increasingly turned to online platforms for groceries, meals, and other essentials. Since the e-commerce and retail sectors are among the country's top consumers of paper and paperboard solutions, this trend is anticipated to drive a heightened demand for sustainable packaging solutions.
- Additionally, India's rapidly expanding industrial landscape, including food and beverage and cosmetics, is witnessing accelerated growth. Government initiatives aimed at curbing plastic waste are further propelling this market's expansion. Consequently, heightened consumer awareness, coupled with India's burgeoning organized food sector, is fueling this market's growth. In FY 2023, India's export value for paper and paperboard products reached approximately USD 3.04 Billion, according to the data reported by the Department of Commerce in India.
- The paper packaging market in India is expanding, fueled by a consistent demand for premium packaging across diverse sectors. These include fast-moving consumer goods (FMCG), pharmaceuticals, textiles, organized retail, and the surging e-commerce landscape. Moreover, the rising demand for paper and paperboard packaging is driven by products like fruit pulp, juices, concentrates, sauces, and ketchup bottles. Notably, the Indian industry has embraced sustainability and has made significant technological advancements.
- The Indian Paper Manufacturers Association (IPMA) projected that India's paper consumption would grow from 6% to 7% annually, reaching 30 million tonnes by FY 2026-2027. This growth is mainly fueled by a heightened focus on education and literacy, alongside a surge in organized retail. Additionally, given that India's per capita paper consumption is among the lowest globally, the paper industry in the country showcases vast growth potential.
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