Shifting Trend Towards Flexible Liquid Packaging Bodes Well for Market
The liquid packaging market has evolved to adapt to the sonic pace of changes in the food and beverages and consumer goods industries. The liquid packaging solutions (LPS) industry is estimated to be a US$400 billion market by 2025 and is ranked as an important segment within the broader industrials sector. Within the liquid packaging industry, the players are classified as either packaging converters, producing or providing materials for packaging, or equipment companies. The industry is slightly fragmented with the top 25-30 companies accounting for less than 25% of the market. Several of liquid product manufacturers are making a swift transition towards using flexible packaging solutions rather than rigid one’s to cut production costs, improve production efficiency, and expand sustainability footprint.
The innovation of gable-top milk cartons set the ball rolling for liquid packaging. Over the years, the demand for packaging has been reliant on sales of beverages, processed foods to chemicals, and cosmetics. The packaging solutions for liquid products is determined based on the requirements and specifications such as sizes, weight carrying capacities/volumes, and other finish options as observed through consumer choices.
Rigid Packaging to Dominate Liquid Packaging Market with its Excellent Resistance
Growth in per capita income, changing lifestyle patterns, and improved health consciousness are some of the key factors contributing to the growth of liquid packaging. In addition, greater competition, the need for quality labeling, and increasing preferences for packaged goods have compelled manufacturers to make innovations and technological changes in the liquid packaging solution offerings. Based on customer preferences, the liquid packaging market is segregated into rigid liquid packaging and flexible liquid packaging. Among these the former is the most widely used packaging type.
Rigid liquid packaging comprises of products such as cartons, paperboard, glass, cans, and plastics & PET bottles. Plastics & PET bottles account for the largest segment of the rigid liquid packaging type as they are widely used in the packaging of liquid products such as water, carbonated drinks, alcohol, beverages, dairy products, and others. Rigid liquid packaging is regarded as the traditional packaging type for liquid products owing to its properties such as resistance to impact, moisture, recyclability, and chemicals.
Expansion of Food & Beverage and Pharmaceutical Sectors to Fuel Demand for Liquid Packaging
Food & beverages and consumer products (such as cosmetics, personal care, home care, etc.) are the largest users of flexible liquid packaging products. The purchase cycle for most of the daily used products such as milk, sauce (in sachets and pouches), shampoos (sachets), and dairy items is still very small, leading to a continuous demand for packaging. With increase in consumption of ready-made meals, or foods, and dietary beverages, there is enormous scope for liquid packaging manufacturers to delve into product innovations. In fact, such innovations have already been observed in the market with the use of BOPP films on pouches, plasma coating on films, stand-up pouches, controlled atmosphere packaging, modified atmosphere packaging, and multi-layer films packaging.
Automation in the packaging processes have further contributed to the ease in production, which is attracting more and more packaging manufacturers to make product diversifications. The development in filling machines is one such example, which has helped producers to add efficiency to their manufacturing processes by both speeding up the process and reducing waste.
North America and Europe to have a Substantial Growth
Asia Pacific is leading the global liquid packaging market, in terms of value, and is projected to continue till 2025. Countries in this region such as China, India, Japan, South Korea, Malaysia, Thailand, and Indonesia are witnessing significant increase in the use of liquid packaging in the food & beverage industry. This increase in demand is attributed to the expansion of food & beverage and pharmaceutical sectors, promising government policies for manufacturers, and the shifting of the production facilities by major players owing to the low labor and operating costs.
North America and Europe are also expected to expand at a substantial growth rate during the forecast period. A massive revenue contribution is observed by the U.S., since the demand for nutraceuticals and ready-to-eat meals is on the rise in the country. The increasing usage of paper products in the region are expected to drive the demand for liquid packaging. The demand for plastics & paper liquid packaging products is projected to have stronger growth in these regions as consumers and manufacturers tend to avoid glass & metal packaged products to avoid add-on shipping & operation cost.
Companies are Concentrating on In-licensing and Partnership Agreements to Launch New Products
The presence of well-established market players such as Mondi PLC, Tetra Laval International S.A., Nippon Paper Industries Co. Ltd, Elopak AS, Liqui-Box Corporation, BillerudKorsnäs AB, Smurfit Kappa Group, Klabin Paper, Comar LLC, and International Paper Company has made the market very competitive for small and medium-sized enterprises. However, these companies are concentrating on in-licensing and partnership agreements to launch new products in developing markets such as Asia Pacific, and Latin America.
Some key developments witnessed in the liquid packaging market are expansion of product offerings in America as Smurfit Kappa in February 2020 announced to invest around US$ 36 Mn for paper sack business. Meanwhile, Liquibox acquired DS Smith plc’s plastic division in February 2020, to strengthen flexible packaging and dispenser’s business.
Key Elements Included In The Study: Global Liquid Packaging Market
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