PRIMIR Packaging Study Identifies Global Mega Trends

October 1, 2009

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Sustainability, government regulations and high energy costs are three of the 20 trends affecting the North American packaging industry, according to a soon-to-bereleased PRIMIR Study, “Global Trends in Packaging Affecting North American Converter & Supplier Markets.” As with all industry segments, packaging has been impacted by the economy during the past year. Printed packaging 2008 shipments were estimated at $79.7 billion, according to the study.

But in 2009 the picture changed. “Some markets are horrific, some just very bad,” comments Dave Costa of State Street Consultants, who conducted the research.

The PRIMIR study goes on to provide the market estimates to 2013 broken down by the four packaging segments studied (corrugated, flexible, tags and labels and folding cartons). Little growth is anticipated for corrugated with shipments in 2013 estimated to be $26.5 billion, up from $25.8 billion in 2008. Folding cartons also shows little growth during the period, only climbing to $11.58 billion from 2008’s $10.9 billion. In contrast, flexible packaging and tags and labels show moderate growth in the years ahead. Flexible packaging, with industry shipments totaling $28 billion in 2008 is estimated to grow to $31.1 billion by 2013. Tags and labels, with shipments of $15 billion in 2008 are expected to grow the most to $17.5 billion in 2013.

Although factors differ in impact among the four segments studied, just six of the 20 trends identified will have the greatest impact—sustainability, government regulations, high energy costs, retailer involvement, global economics, and offshore manufacturing. We discuss three of these factors in this article.

Sustainability represents the most talked about trend underway. Retailers, with WalMart leading the charge, are touting a “save mother earth” philosophy. And, by the way, let’s make money, cut costs and increase profits at the same time. Retailers’ emphasis on reducing packaging is planned through a number of initiatives:

• A reduced product-topackage ratio strives for packaging inside of the box being reduced, thus allowing for packages with smaller footprints;

• The increased use of recycled content in packaging;

• Cube utilization such as the use of trays and shrinkwrapping around larger quantity products like bottled water and canned goods; and,

• Packaging material sustainability.

Folding cartons and corrugated segments will be most affected by reductions in packaging materials and sizes of the packages. For example, the move from full-boxes to plastic wrapped trays will reduce the amount of corrugated used. On the other hand, flexible packaging will move to thinner substrates (providing a bright spot for press manufacturers as newer presses are better suited to handle these materials). Finally, label use will be negatively impacted as rigid containers convert to flexible packaging.

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