Market Trends of India Metal Packaging Industry
This section covers the major market trends shaping the India Metal Packaging Market according to our research experts:
Cans are Expected to Hold Significant Share
- The metal cans industry in India is coming up with some interesting and captivating packaging concepts. However, the key component is the sustainability and recyclability of the packaging material. There are contemplations of a major role of metal packaging, including metal cans and containers, in the future, as it is manufactured out of sustainable material - tinplate or tin-free steel, and follows the principles of reduce-reuse-recycle.
- Increased urbanization is one of the major reasons that are prompting companies to increase metal cans and container production capacity. Moreover, the penetration of organized retail is also compelling market players to ramp up their capacity. To cater to the growing demand for metal cans and containers in the country, companies such as Ball Corporation are expanding their packaging offering to various other segments such as wine, sparkling water, and alcoholic drinks such as rum, whiskey, and vodka.
- Despite India being the third largest producer and consumer of aluminum globally, the penetration of aluminum in the packaging segment is lower than the global average owing to high costs. There could be a potential proliferation in the packaging sector with growing health consciousness owing to aluminum's hygienic properties and the boom in the pharmaceutical industries. According to CRISIL, the demand from the packaging segment for primary and secondary aluminum (i.e., recycled aluminum) volumes were anticipated to be 6-8% and 6-7%, respectively.
- Moreover, Tinplate Company of India Ltd (TCIL) has been planning to double its capacity at its tinplate production line by 2025, following strong demand for its products. TCIL's three-year expansion project will begin in 2022 and will increase the capacity at Jamshedpur from 379,000 tons to 679,000 tons. Following this, TCIL aims to reach a 1 million tons capacity by 2030. At the same time, JSW Steel is increasing its capacity from 3,50,000 tons to 6,20,000 tons.
- According to the Agricultural and Processed Food Products Export Development Authority, The export value of alcoholic drinks from India in the fiscal year 2022 was 278 million US dollars. The vast majority of the beverages were shipped to the United Arab Emirates. The such huge export value would create an opportunity for the studied market to grow.
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Food Industry is Expected to Drive the Market
- Meat, fish, dairy-based desserts, premium chocolates, dry fruits, and pet food are the preferred food products packaged in metal cans and containers in India. Dairy products such as Gulab Jamun, Rasgulla, etc., are preferred to be packed in metal containers. Indians prefer these dairy-based desserts over other types of desserts. According to the Swiggy Survey , a total of 2.1 million orders of Gulab Jamun were placed from the Swiggy food delivery platform last year, which was the most ordered dessert. Ras Malai was in the second position with 1.27 million orders.
- Furthermore, the growing pet food demand is also triggering the market's growth. For instance, the Animal Welfare Board of India (AWBI) announced a pet food shortage and urged India's government to boost local production. The country has an estimated pet animal population of 29 million and requires 30,000 tons of pet food.
- The food sector is one of India's major sectors using metal cans and containers. Steel is used primarily to make rigid cans, whereas aluminum is used to make thin and lightweight cans. Nearly all steel used for cans is coated with a thin layer of tin to inhibit corrosion from the food and is called tin cans. The Indian market is witnessing significant emerging trends catering to the food industry. For instance, India is a major exporter of agricultural and processed food products. According to the Ministry of Commerce & Industry, despite COVID-19 restrictions, particularly owing to the second wave of the pandemic, agricultural and processed food product exports achieved a robust increase of 44.3% in 2021-22 (April-June) compared to the corresponding period in 2020-21.
- The robust export activities of the country also created a need for storing processed items, leading to the demand for metal food cans. For instance, according to the Ministry of Commerce and Industry of India, India's export of final consumer food products, such as Ready to Eat (RTE), Ready to Serve (RTS), and Ready to Cook (RTC), registered significant growth in the last decade. The export of these products registered a CAGR of 10.4% from 2011-12 to 2020-21. This export increased by over 23% to USD 1,011 million from April to October (2021-22) compared to USD 823 million reported from April to October last year.
- According to USDA Foreign Agricultural Service, in 2021, the consumption value of organic packaged food in India will be USD15 million. This is an increase over the previous year's consumption value of 14 million US dollars. In 2022, the consumption value was expected to rise to 17 million US dollars. Such huge consumption of organic packaged food is expected to drive the studied market.
