Market Trends of Solid Board Packaging Industry
Rising Demand From the Ecommerce Sector Boosts the Top-Line
- Packaging plays a pivotal role in e-commerce, influencing everything from goods protection and environmental considerations to transportation, storage, marketing, and advertising. As e-commerce packages can be handled 20 times or more during standard distribution, the logistics chain for direct-to-consumer delivery has grown. This heightened complexity has spurred a demand for cost-effective secondary solid board packaging material.
- Since the onset of the COVID-19 pandemic, the demand for solid boards in online secondary and tertiary packaging has surged. Amazon's recent Prime Day underscores the pivotal role of online retail sales in today's economy. Shipping boxes from Amazon and other retailers not only symbolize the e-commerce boom but also stand as a primary driver for the global demand growth of containerboard and solid board.
- As reported by the US Census Bureau, retail e-commerce sales in the United States hit an estimated USD 275 million in 2023, a substantial rise from USD 142 million in 2019. The growing incorporation of technology into everyday activities has propelled e-commerce's soaring popularity. It can be expected that a notable increase in e-commerce users in the United States will bolster the demand for robust secondary and tertiary packaging solutions for solid boards.
- With the rising demand for eco-friendly material, e-commerce sales have surged, outpacing projections by over two years. In contrast, the paper board industry is grappling to match this pace. While paper mills are running at full throttle, certain producers are not only capping orders but also turning to smaller firms for outsourcing. As consumers increasingly gravitate toward e-commerce, sidelining traditional brick-and-mortar stores, the demand for solid boards is poised to keep climbing.
- Several manufacturers across the globe are innovating several solid board packaging options for online end-users. For instance, in the recent past, Kite Packaging launched e-commerce solid board boxes and food boxes that are perfect for packing moist and chilled solutions, even in humid conditions. Such developments across the market may propel the demand for solid board packaging in the coming years.
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Asia-Pacific To Hold Strong Position in the Market
- Asia-Pacific is poised to dominate the solid board market, driven by surging demand for packaged food products in nations like China and India. This trend is expected to position Asia-Pacific as the leading player in the market during the forecast period.
- As per the Retailers Association of India, the value of packaged food in India is expected to grow consistently from INR 3,615 billion (USD 43.05 billion) in 2020 to an expected value of INR billion 5,798 (USD 69.05 billion) in 2026. With the growing market for packaged food, there would be a proportionate opportunity for solid board material for packaging.
- In recent years, developed regions have increasingly embraced gadgets and appliances, while China has emerged as a leading global exporter of electronics. These appliances require robust protection from external damage and shocks due to their heightened sensitivity. This demand creates lucrative opportunities for suppliers of solid board packaging in China.
- According to Shanghai.gov data, the Chinese consumer electronics market was projected to register retail sales of CNH 2.2 trillion (USD 305 billion) in 2023, marking a 4% increase Y-o-Y. The growth rate is anticipated to accelerate to 5% in 2024. Such consistent growth in the consumer electronics sector is expected to propel the demand for solid board packaging in the coming years.
- Moreover, Asian governments, notably in India and China, have been vigorously stepping toward anti-plastic packaging campaigns. These initiatives are likely driving the demand for sustainable solid board packaging materials. For instance, in 2022, India implemented a ban on single-use items, including plastic bags and food packaging. This created a positive impact on the demand for solid board materials for packaging across the country.
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