Market Trends of India Packaging Industry
Food Industry is Expected to Hold the Largest Share in the Market
- Consumers increasingly turn to nutrient-dense dairy products like cheese, milk, and yogurt, seeking heightened nutrition. These products have a longstanding reputation for being rich in vitamins, proteins, and easily absorbable calcium. The presence of numerous biologically functional components bolsters the dairy products segment's outlook for the forecast period.
- In 2023, India emerged as the largest consumer of cow milk globally, with a consumption exceeding 87 million metric tons, as the USDA Foreign Agricultural Service reported. India's dairy sector boasts diverse products, including ghee, butter, lassi, and paneer. Notably, curd and yogurt stand out as the most lucrative segments.
- Flexible packaging, favored by consumers and producers of baked goods and snacks, offers unparalleled convenience. Consumers value its resealability and user-friendly nature, especially for products like cookies and bread, which are commonly enjoyed over multiple sittings.
- According to a survey conducted by LocalCircles, a social research firm, in November 2023, with 10,939 respondents spanning 222 districts in India, a significant majority of respondents reported daily consumption of bakery products. Films play a pivotal role in driving the surge of flexible bakery packaging. They safeguard bulk-packaged bakery items, meeting the rising consumer appetite. Lightweight and adept at ensuring safe deliveries, bakery flexible packaging, especially films, enhances product visibility, propelling the sector's growth.
- Flexible packaging for frozen foods must ensure top-tier product safety from production to consumption. These materials are tailored to withstand extreme cold, ensuring the integrity of the packaging. The rising consumption of frozen fish, chicken, and other meats drives the demand for packaging materials. Flexible packaging, favored for its ability to shield against contaminants, preserve freshness, and provide convenient storage, is particularly well-suited for meat products.
- According to data from the Ministry of Commerce & Industry, in June 2023, frozen fish emerged as a leading export, raking in INR 5,503.18 crore (USD 687.05 million). Notably, a significant surge in frozen fish exports was observed in 2023. Quantities rose by 62.65%, while INR and USD values climbed by 58.51% and 45.73%, respectively. The growth in frozen fish exports would bolster the demand for several flexible packaging formats across the country in the coming years.
- With India witnessing a notable surge in milk production and consumption, the demand for flexible packaging in the dairy industry has soared. These solutions are tailored to meet the specific needs of the dairy sector, offering robust advantages. According to the USDA Foreign Agricultural Service, in 2023, India's domestic milk consumption surpassed 207 million metric tons, which rose from the previous year's 202 million metric tons. This growing trend is expected to continue in the upcoming years, contributing to the demand for flexible dairy pouches, films, and other products across the country.
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Paper Packaging is Expected to Hold Significant Market Share
- The environmental advantages of paper packaging are the primary drivers behind the expanding market for paper flexible packaging. Paper packaging, known for its lightweight, biodegradable, and recyclable nature, provides a flexible and cost-effective means of transporting, preserving, and safeguarding products and plays a pivotal role in the growth of the flexible packaging industry. According to the Department of Commerce (India), during the financial year 2023, India's paper and paperboard product exports reached a valuation of around 3.04 billion U.S. dollars.
- Over the past decade, the Indian paper packaging sector has seen significant growth, attributed to shifts in substrate preferences, the penetration of new markets, evolving ownership structures, and governmental initiatives aimed at curbing plastic usage. The segment is poised for further growth with a continued emphasis on sustainability and environmental concerns, coupled with a wave of innovations in paper packaging.
- The Indian flexible packaging sector utilizes paper in various forms, such as bags, sachets, and wraps. The rising demand for more miniature packs has propelled the flexible pouch market, known for its small-quantity packaging. Compared to traditional packaging, flexible paper packaging stands out for its cost-effectiveness, minimal material requirement, and lightweight nature. Its efficiency and affordability have significantly boosted the popularity of flexible paper packaging.
- According to Indian Pulp & Paper Technical Association (IPPTA), the Indian Paper Industry accounts for 1.6% of the world’s paper and paperboard production. The industry’s turnover is expected to touch the 60,000 mark by 2025.
- According to IBEF, India has 861 paper mills, 526 of which are currently operational. Collectively, they have an installed capacity of 27.15 million tons. From April 2000 to December 2023, the Paper and Pulp sector, encompassing paper products, attracted FDI inflows totaling USD 1.7 billion.
