Market Trends of Europe Food Packaging Industry
The Foodservice Industry is Growing Rapidly
- The expansion of urban areas, evolving dietary preferences resulting from limited leisure time, and rising disposable incomes are key factors propelling the growth of the foodservice industry, thereby increasing the demand for food packaging solutions. Additionally, there has been a notable shift toward online food deliveries and take-out services, further amplifying the need for diverse food packaging products. Furthermore, numerous companies are actively strengthening their market presence through product launches.
- Snack foods have increasingly become a substitute for traditional meals, leading to a rise in the snack food market across European nations, primarily due to their convenience and rapid provision of nutrition and energy. According to the Glanbia Nutritionals report published in May 2024, savory snacks represented the leading subcategory in Europe, with 57% of consumers having made purchases in the previous year. This remarkable growth is poised to create substantial opportunities for packaging suppliers.
- Similarly, the increasing demand for other food products is driving investments in the region, which is expected to enhance the market's growth significantly. The European Commission forecasts that the domestic market will continue to be the main destination for EU milk production, representing 88% by 2035. There is a noticeable shift in consumer preferences, particularly among younger individuals who are increasingly favoring dairy products that have lower fat and sugar levels, as well as those designed for individuals with food intolerances. The health requirements of the aging population and changing lifestyle choices are expected to enhance demand for plant-based alternatives.
- In August 2023, a study conducted by the University of Hohenheim in Germany aimed to identify the determinants and drivers influencing the demand for plant-based dairy products across various EU countries with initially differing sales levels. Among the six countries examined, Germany had the highest sales and the greatest market potential for plant-based dairy products. Furthermore, the Good Food Institute reported that sales of dairy alternatives in Europe increased by over 45% from 2020 to 2023. These substantial factors are anticipated to drive market opportunities.
- Increasing investments by the major vendors to drive the foodservice industry across various countries, like Germany, France, and the United Kingdom, is further expected to drive the market's growth. As reported by GTIA, Germany's food and beverage industry remains a focal point for new investments from global investors eager to enter a market characterized by its diversity and profitability. The rise in individuals adopting vegetarian and vegan diets is contributing to the swift growth of the plant-based food industry in Germany. International firms, such as Switzerland's Planted, are capitalizing on this trend. These notable developments are anticipated to significantly increase the demand for packaging solutions.
- As reported by the Statistisches Bundesamt, the meat processing and preservation industry constituted the largest portion of the food manufacturing industry in 2023, generating a total revenue of around EUR 49.97 million (USD 55.24 million). Dairy products followed with a turnover of EUR 38.34 million (USD 42.39 million). Additionally, the rising popularity of online food delivery services is a key factor propelling the growth of the food packaging market. With a growing number of individuals opting for online food services, the demand within this market is anticipated to increase substantially.
- In November 2023, the German government announced an investment of EUR 38 million (USD 42.01 million) to promote alternative proteins. The 2024 budget included this allocation specifically for the advancement of precision fermentation, plant-based, and cultivated meat and dairy alternatives. Additionally, in January 2024, the German Ministry for Economic Cooperation and Development (BMZ) contributed EUR 1.95 million (USD 2.16 million) to the Standards and Trade Development Facility (STDF) to support developing countries in meeting international food safety standards. These governmental initiatives are anticipated to significantly boost market growth.
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The United Kingdom is Expected to Hold a Significant Market Share
- The UK government stated that by integrating premium produce with advanced technology, the United Kingdom will lead in terms of innovation within the food and beverage industry. This industry represents the largest in the country by revenue, amounting to GBP 104.4 billion (USD 136.5 billion), surpassing the combined value of the automotive and aerospace industries. The United Kingdom offers numerous prospects for exporters, investors, and international purchasers, showcasing essential strengths in the food industry. These substantial market capabilities are expected to stimulate demand within the packaging market.
- The United Kingdom has positioned itself as a leader in innovation, merging high-quality products with technological advancements to meet consumer demands. According to gov.uk, in 2023, 58% of the domestic food consumed in the United Kingdom originated in the country. The rise in popularity of vegetarian and vegan diets represents a significant opportunity for the food industry, prompting manufacturers to develop plant-based and alternative protein sources. The UK government unveiled its Research and Development Roadmap, which aims to boost public investment in research and development to GBP 22 billion (USD 28.99) annually by FY 2024-25. These initiatives are anticipated to boost market growth for diverse packaging technologies.
- The market is witnessing a growing demand for sustainable and environmentally friendly packaging solutions, with funding opportunities available in the United Kingdom to support the development of such products. The government's Smarter Innovation Programme promotes innovations aimed at enhancing manufacturing sustainability by minimizing material waste and energy usage. For example, companies in Greater Manchester are well-positioned to assist the Waste and Resources Action Programme (WRAP) in achieving the goal of making all plastic packaging recyclable, reusable, or compostable by 2025. These advancements in sustainable packaging technologies are anticipated to significantly enhance the market's potential.
- In July 2023, five innovative projects were unveiled aimed at significantly enhancing the sustainability of plastics. With a funding allocation of GBP 6 million (USD 7.87 million), these initiatives seek to mitigate the substantial environmental harm caused by plastics while also extending their usability and increasing their economic value. These multidisciplinary projects, spearheaded by UK universities, will focus on improving the recyclability of multilayer food packaging over a three-year period.
- Several companies are investing significantly in sustainable packaging solutions in the country, which is one of the factors helping the market gain traction. For instance, in November 2023, Nestlé UK and Ireland announced that they would commit GBP 7 million (USD 9.18 million) to the Impact Recycling facility located in Durham. This state-of-the-art plant is dedicated to tackling the challenge of hard-to-recycle flexible plastics and utilizes the Baffled Oscillation Separation System (BOSS) to effectively sort plastics according to their density. Furthermore, this investment contributes to the circular economy by establishing strategic collection points for packaging materials such as KitKat wrappers and Purina pet food pouches.
- Furthermore, in July 2023, BioPak UK, a provider of plant-based compostable packaging solutions, introduced a new range of eco-friendly food packaging. The sandwich wedges and wrap wedges are constructed from responsibly sourced paperboard certified by the Forest Stewardship Council (FSC), complemented by a waterproof lining and window made from Ingeo bioplastic. The company stated that its takeaway sandwich boxes are suitable for industrial composting and meet EN13432 European compostability standards.
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