MARKET TRENDS AND DEVELOPMENTS IN PACKAGING, EMAP, BRUSSELS 2001

Françoise Pardos, Pardos Marketing, February 2006

Packaging is the largest application of polymers, in all countries, at all levels of development, 30 to 40 % of total plastics consumption, boosted by very strong facts and trends.

Past, present, and forecast figures show diversified plastics growth in packaging, and new competition between plastics.

The narrow link of packaging with food products makes packaging a stronghold of resistance, even in recession.

The fast development of emerging countries generates demand for improvement of the food supply and packaging.

Research goes on, for smarter, simpler, thinner packaging, of higher performance and easier on the environment.

Introduction

Packaging is older than history. Back to the most remote times, the first hunters-gatherers needed some sort of packaging to keep the foods for the long winters. In fact the first handicrafts of mankind must have been weapons, ropes and baskets.

Up to this century, packaging was re-used. It is only in the last fifty years, that packaging became a major industry, actively part of all others, particularly in the most industrialized areas, until 1980-1985, and everywhere in the last twenty years.

There are several particularities of packaging, valid everywhere, in various states of advancement

Short of instantaneous and magical availability of goods, in space and time, packaging has been closely associated with the progress of civilization, to preserve perishable crops for increasingly longer periods and permit consuming them in places far remote from where they originated. In the last decades, the role of packaging was further enlarged, developing downstream into ever multiplying outlets, from the field, to the plant, and to the restaurant and the household kitchen, ever widening the division of labor and offering ready meals as an ultimate service to the consumers.

Packaging is also one of the industries with the fastest machine outputs, because of the large numbers involved, and where technical innovations continue to play a determining role, as multiple and diversified as its protean nature.

And yet, packaging is only of second interest to its industrial users, it is less important than "what is in the package", and a packaging change, however momentous, is only a fake product change.

In commercial and sales terms, packaging plays a crucial role, in competition with similar products displayed on the self-service store shelves. While the general message of food products is the reassuring safety of tradition, the message of packaging is the eye-catching flash of novelty.

There are several particularities of packaging, valid everywhere, in various states of advancement.

Packaging is four main materials,

• Metals, tin plate and aluminum,
  
• Glass,
  
• Paper and board,
  
• Plastics

Plastic packaging is four main types,  

• Flexible, film, of paper, metal, plastics, sacks, bags, pouches, wraps, lidding, labels
• Rigid, cans, trays, cups, dishes, crates, containers, of metals, plastics, cardboard, cartons
• Bottles and containers
• Other, twine, strapping, cushioning

Packaging is three main applications/functions

The oldest, to carry and store, wholesale, industrial packaging, or tertiary packaging.

The most recent, the unit consumer packaging, primary packaging, in direct contact with the contents, developed with supermarkets and self-service retailing.

The consumer secondary packaging, either on primary packaging, or collating a number of consuming units into sales units as multipacks.

Packaging is part of all industries:

However, because of large numbers and unit multiplication, food products and disposable non food consumer products, household/maintenance, cosmetics, pharmaceuticals, account for the largest share of packaging.

Out of the 600 liters/year of liquids, an average per capita of 350 to 480 liters, other than tap water, for coffee and tea, is sold in a wide range of container sizes and types. With few exceptions, most liquid food products are now sold in one-way packages, ranging from 15 cl to 2 liters. This bulk calls for a theoretical number of unit packages, for the 500 million people of Europe, of over 700 billion units for solid foods and of about 400 billion units for liquids, plus the secondary packaging needed for these numbers of unit containers.

There are few other end-use markets for packaging which can compare with these numbers. Industrial products account for much fewer packaging units and non food, non durable consumer goods are not as much a daily, universal consumption as foods and beverages are.

All in all, the very large packaging markets are those of non-durable products regularly purchased, foods, pharmaceuticals, cosmetics, various chemicals, packaged into small, from 20 grams to 5 kg, consuming units, the tonnage of the packaging demand originating from their overall volume and their fragmentation into small size containers.

Share of food packaging in the total market of main packaging materials in % of total packaging material tonnage

Total consumer disposable product packaging split

Except for a few food products, the most elaborate, high added-value and newest types, the overall growth of food products is limited, often stable or declining for all large volume basic products like bread, pasta, meat, vegetables, potatoes, preserves, oils and fats, sugar, milk, beer, wine and spirits. These trends indicate both the decrease of raw, traditional foods, those considered less "dietetic", in favor of more sophisticated and prepared foods, increasingly elaborated upstream at the factory rather than at home from basics.

About the globalization of food habits, in Europe and elsewhere, food still is one of the last strongholds of market nationalism tied to national diets, cooking and eating habits. But the new successful products outside of basics are becoming global at least in the richer world:

• Soft drinks.
• Frozen and chilled ready dishes.
• Ethnic recipes.
• Snacks.
• Fresh/chilled prepacked fruit and vegetable salads.
• Breakfast cereals.
• Fresh desserts.
• Ice-cream.

Altogether, the very market for packaging, food and drink, is not to grow much in volume terms, in the industrialized countries, where the average food intake is already too much. Among the dire forecasts, some will say: "The future of packaging? People should cut their average food and drink intake by at least 30 % to stay in good health!".

But there is a silver lining. Packaging industries and package value will continue growing, because of more sophisticated packages, and higher value. This is where the new materials come in.

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