Market Trends of Russia Plastic Packaging Industry
Flexible Plastic Packaging Drives Market Expansion
- The demand for flexible plastic packaging is increasing for food, beverages, and pharmaceutical applications for product packaging. Daily orders of staples and fresh food online are increasing the demand for flexible plastic packaging. The Russian government informed food industry players to ramp up production to avoid shortages and maintain uninterrupted supply. FMCG companies are responding by demanding more flexible plastic packaging products.
- The demand for flexible plastic packaging from the pharmaceutical industry will remain strong as hospitals, pharmaceuticals, and PPE manufacturers respond to the crisis. The demand for household, healthcare, and medical products is not expected to decline dramatically, and retail distribution of these products through online distribution is expected to increase. This will increase the demand for flexible plastic packaging solutions for timely raw materials and finished products to their respective end users.
- The demand for pharmaceutical packaging is expected to continue to rise. The government plans to increase export volumes by 2030 and use more internally produced preparations in Russia. Since January 2020, all medication packaging has been labeled with a crypto code and a data matrix code or RFID tag for each saleable unit to end the black market for counterfeit medications.
- According to the Russian Federal State Statistics Service, the production volume of polyethylene polymers in 2020 was 3.2 million metric tons, which increased to 3.54 million metric tons in 2023. A rise in plastic resins over the forecast period would create more opportunities for the plastic packaging market in the country.
- In July 2023, Sibur introduced its new polypropylene production facility in Tobolsk, Russia, with a capacity of 570,000 tonnes. The company anticipates the project to be completed by 2026. Starting in 2027, Russia and Sibur are expected to benefit from the increased capacity, providing consumers with a greater polypropylene supply.
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The Food Industry is Expected to Drive the Market
- Food production and processing play a pivotal role in Russia's economy. The food industry stands out as one of the most lucrative in Russia, holding a prominent position on the global stage. Over the past few years, grocery sales in Russia have shown a consistent upward trajectory, with online food retail emerging as a critical driver of market revenues.
- As food demand surges, so does the need for packaging and rigid plastics. An increasing number of Russian households are opting for takeaway meals delivered by services, further amplifying the demand for packaging.
- Additionally, with the rise of online trade, there is a growing requirement for packaging. According to the Federal Customs Service of Russia, the import value of food products and agricultural raw materials in 2019 was USD 29.8 billion, which was expected to reach USD 35.1 billion in 2023. The rise in the import value of food products drives the demand for packaging in the country.
- As per the Agriculture Ministry, Russia is actively seeking packaging suppliers for baby food and dairy products. This move came in response to supply disruptions caused by Western sanctions on Moscow. Despite being a significant player in global agriculture, Russia faces challenges due to these sanctions, especially with some foreign suppliers exiting the market.
- Organizations such as the Flexible Packaging Association are rapidly adopting barrier films in secondary recycling. This came in light of new taxes imposed on non-recyclable packaging. Concurrently, the focus is increasing on broadening the scope of reusable packaging in food and other industries.
