The global packaging sector is going through a period of transition with shifts toward:
- more personalised packaging
- a keen focus on sustainability
- a greater emphasis being placed on certain market segments such as food and beverage.
We’ve decided to provide a snapshot of the growth forecasts for global packaging and identify the main growth drivers.
In 2017, the global packaging sector was valued at $851 billion and is expected to reach $975 billion by the end of 2018.
Various reports show that the global packaging sector is expected to grow at a CAGR of approximately 3-4% through to 2022.
Key Growth Drivers
A shift in consumer preferences towards e-commerce is lowering the barriers to entry for new players within the packaging sector. The global e-commerce market has witnessed a substantial growth since 2014 and is expected to witness a high growth rate through to 2020 which will fuel further demand for packaging.
The food and beverage segment is expected to dominate the packaging market in the coming years, growing at a CAGR of approximately 6% through to 2022. The glass bottles segment, which increased by 6% in 2017, is expected to be the most attractive segment, with 90% of consumers favouring glass to preserve the flavour and taste of products.
Emerging markets in Asia and Africa continue to present medium-term, top-line growth prospects. Global packaging sales are concentrated in Asia, North America and Western Europe, each accounting for around 25% of all sales. However, within the food and beverages segment, a large number of emerging economies such as China, India and South Korea have been witnessing increased consumption of food and beverage products which is driving demand for packaging.
The trend around personalised packaging is revolutionising the customer experience across a whole host of channels and sectors. The global personalised packaging market was valued at just over $25 billion in 2017 and is expected to experience strong growth of CAGR 5.1% through to 2025.
M&A activity in 2018 is expected to be in line with 2017 volumes, helping to offset the drag being created by fiercer pricing competition. Consolidation is expected to continue in Europe where the market is significantly more fragmented than in the USA. However, given the state of the packaging market, there is a need to look to combine M&A with new ideas which will enable firms to thrive in the longer term.
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