Market Trends of India Paper Packaging Industry
Corrugated Boxes to Dominate the Market
- The expanding e-commerce sector primarily drives the Indian market for corrugated boxes. In addition, the widespread use of fast-moving consumer goods (FMCG), such as household goods, beverages, medications, and toiletries, further accelerates market expansion. In addition, the leading manufacturers have designed corrugated boxes in various sizes and shapes in response to consumers' growing preference for lightweight and innovative packaging materials.
- Further, the growing sales of the retail industry are creating a demand for corrugated boxes to transport and store goods in a cost-effective and durable way. The diverse range of products sold in retail stores necessitates various sizes and shapes, which corrugated boxes readily provide. For instance, according to the Retailers Association of India, in June 2023, the retail trade industry in India registered its highest sales growth of 15% in the footwear and food categories. In contrast, apparel and clothing registered a 7% sales growth during the same period.
- The government launched the production-linked incentive (PLI) scheme to incentivize businesses in 10 industries to boost domestic manufacturing and exports to control the disruption in the supply chain scenario. Atmanirbhar and structural changes are other factors expected to increase the demand for corrugated box packaging.
- Direct-to-consumer (D2C) brands in food, cosmetics, fashion, and consumer electronics have also contributed to this rise in demand. By using a D2C approach and interfacing clearly with the expanding number of digital shoppers, these new-age digital-first brands are now challenging established brands. Such instances are expected to drive market growth in India.
Understand The Key Trends Shaping This Market
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Food Industry Holds Major Market Share
- Paper and paperboard stand out as prevalent solutions in the realm of food packaging, owing to their eco-friendly nature, which not only aligns with current sustainability trends but also positions them as key solutions for food packaging. The paper finds extensive use in direct food contact as well as in the transportation and storage of primary packages. Moreover, it plays a pivotal role in crafting items like microwave popcorn bags, baking paper, and even fast-food containers. These factors collectively highlight the anticipated growth of the paper packaging sector in India. India's market growth in paper packaging is anticipated to be driven by high consumer awareness of packaged food and exceptionally packaged food delivery.
- With consumers increasingly embracing on-the-go lifestyles, the demand for convenient, easy-to-handle foods is surging. In response, brands are innovating, making food packaging more portable. Paper packaging has emerged as a preferred among packaging manufacturers due to its lightweight nature. Notably, the Indian food packaging landscape has witnessed a considerable shift towards eco-friendliness. Major players are pivoting away from single-use plastics, opting instead for biodegradable, recyclable, or reusable alternatives, aligning with their eco-friendly solutions.
- In addition, the growing number of quick service restaurants is further augmenting paper packaging market growth in India, creating demand for food bags, folding cartons, and corrugated fibreboard and boxes to offer convenient and perceived hygienic solutions for serving and transporting QSR food items. For instance, according to Restaurant Brands International, the number of Burger King outlets in India increased from 315 in FY 2022 to 391 in FY 2023.
- The robust export activities of the country also created a need for storing processed items of foods such as fruits and several others. For instance, according to the Directorate General of Commercial Intelligence and Statistics (DGCI&S) and Agricultural & Processed Food Products Export Development Authority (APEDA), the value of fresh fruit exports from India reached nearly USD 863.7 million in FY 2023, increasing from USD 876.4 million in FY 2022. This growth in the export of food products is expected to drive demand for corrugated boxes.
