Market Trends of Latin America Paper Packaging Industry
This section covers the major market trends shaping the Latin America Paper Packaging Market according to our research experts:
Increase in Demand for Paper Packaging in Food Industry
- Due to the rising incomes, urban lifestyle changes, and modern retail trade, the food packaging market is expanding significantly in categories such as bakery products, processed food, frozen processed foods, meal replacement products, condiments, and emerging categories like dairy products, frozen ready-to-eat foods, diet snacks, processed meat, and probiotic drinks.
- Packaging types such as folding cartons are used for packing requirements of diverse sizes and shapes and can be regarded as a pioneer in the food packaging industry. Packaging plays a dynamic and vital role in passing on a product's various benefits and attributes to the consumer at the point of sale.
- Consumer lifestyles in Latin America are increasing demand for ready-to-eat (RTE) foods. According to Food and Drug Regulatory, the rise of grab-and-go meals and ready-to-eat meals is shaping the future of the food packaging trends in the region. For instance, according to Jones Lang LaSalle IP, the market size of food service in Argentina is anticipated to grow 21% from 2018 to last year, which is three times more than the estimates made for Brazil and Chile for 2018 to 2022. In Peru and Colombia, the food service market size could increase by up to 6%, while food service in Mexico could register a growth of 4%during the same period.
- Flexible packagings, such as sacks, kraft paper, coated papers, and paper pouches in the region, is also growing due to recyclability, affordability, lightweight, and growth in packaged foods overall. The demand for packaged foods is growing, and more multinational companies are entering the market in the region.
- In addition to incremental gains in lightweight board grades and introducing recycled paper content, environmental pressures from brands and consumers push the market toward eco-friendly materials.
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Brazil is Expected to Register a Significant Growth
- Currently, consumers prefer recyclability and biodegradability as important packaging parameters over reusability. This underlines the growing concerns of consumers about the environmental impact of packaging waste in the future.
- According to certain estimates, nearly more than half of all paperboard packaging is used in food product segments, such as beverages and dairy products, candy and confectioneries, dry foods, and frozen foods. Also, international players are entering the region to expand their customer base and market share. For instance, in September last year, Smurfit Kappa, a corrugated packaging company, agreed and acquired the Brazilian packaging plant, Paperbox. The plant is located in Saquarema, 70 km east of Rio de Janeiro, and the 50,000m² high-tech industrial park has its own logistics fleet.
- In the country, industries such as beverages, clothing, accessories, leather, and accessories were highly impacted by the pandemic. However, the demand grew in the industries that use consumer goods, such as food, pharmaceuticals, cleaning, and perfumery. The scope of paper packaging expanded in healthcare and packed food segments, owing to trends like a significant surge in the e-commerce demand.
- According to a survey carried out by the Food and Agriculture Organization of the United Nations (FAO) for the period 2020-2025, the production capacity of wood pulp for paper and paperboard is projected to go up from 23,850 thousand tonnes in 2020 to 29,070 thousand tons in 2025 in Brazil, which will positively impact the demand for paper packaging in the region.
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