Page 18 - Packaging News magazine Jul-Aug 2021

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INDUSTRY INSIGHT www.packagingnews.com.au | July-August 2021
Outlook for sustainable flexible
Smithers’ latest market analysis predicts demand for flexible plastic, paper and foil packaging will continue to rise steadily in the next five years, even as industry simultaneously reacts to supply chain disruption due to Covid and the demand for more sustainable pack designs. PKN reports.
Flexible polymer constructions – especially multilayer laminates – have been identified as among the hardest formats to recycle efficiently.
In response, material suppliers and converters are introducing more mono-material packs designed for recovery in existing waste streams. This is driving R&D on delivering performance characteristics previ- ously only possible with multilayer constructions, such as improving high-speed heat sealing, withstand- ing retort cooking, and home oven- able pouches.
In parallel, the industry is inves- tigating how to use more recycled post-consumer resin in polymer packaging films, particularly the wider use of feedstocks sourced from the first generation of chemical recycling processes.
In retail packaging, there is also more interest in flexible paper con- cepts, including new barrier ideas and designs, which allows brands to demonstrate their green credentials to customers.
SUSTAINABILITY STRATEGIES
While maintaining production and safety during Covid was the top pri- ority for 2020, sustainability has not disappeared from the medium-term agenda.
“Many FMCG companies are main- taining corporate citizenship com- mitments to improve the sustainabil- ity of their packaging by 2025 or 2030, and many state government recovery strategies are looking to match spend- ing to projects that minimise environ- mental impact,” explains Smithers.
THE Future of Global Flexible Packaging to 2026 report by Smithers shows worldwide consumption of flexible packaging reaching a pro- jected 31.5 million tonnes in 2021. This follows a – 5.5 per cent drop in overall value in 2020, as several end-
uses dropped in demand in response to the global pandemic.
Industrial formats, which repre- sent slightly over half of the market, have been affected more than con- sumer packaging applications.
Smithers predicts demand will return through 2021 as lockdown orders are lifted and international trade flows resume. Flexible packag- ing will benefit directly from this, with Smithers forecasting a CAGR of 3.4 per cent by volume, which will see total consumption reach 37.5 mil- lion tonnes in 2026.
COVID-19 IMPACT
Overall, the impact of a post-Covid recession will vary from country to country, and the duration will depend on the success of national virus con- trol and vaccination programmes, as
well as the effectiveness of govern- ment stimulus spending.
Food packaging has previously shown itself resilient in times of eco- nomic downturn, and this represents around 75 per cent of all flexible packaging demand, according to the report.
The report warns that luxury goods will be more adversely affected, but these make limited use of flexibles, while moves to control the virus will support wider demand for medical devices and pharmaceuticals.
“The recovery has already begun, in China and elsewhere in Asia, and these regions represent the largest growth opportunities for flexible packaging suppliers through to 2026,” according to Smithers.
FLEXIBLE PLASTICS GROWTH
The analysis shows flexible plastics will remain the largest segment of the market and will see the fastest growth, although this has come under scrutiny as governments and consumers show a greater interest in a packaging’s environmental impact.
Smithers’ latest analysis expects the flexible packaging market to grow 3.4% (CAGR) from 2021-26.
Food packaging represents
75%
of all flexible packaging demand