North America’s flexible packaging market grew by 3.9% in 2018
June 9, 2019North America’s market for value-added flexible packaging increased by 3.9% to US$25.3 billion in 2018, according to a new report from Wood Mackenzie Chemicals.
Sales in the North American region, consisting of the US, Canada and Mexico, accounted for almost 30% of total global sales of around US$90 billion.
Commenting on the report, Wood Mackenzie analyst Paul Gaster said: “Despite environmental concerns over packaging sustainability, particularly with regard to the use of plastics, flexible packaging demand in North America will continue to grow at above GDP over the next five years.”
“While the industry continues to steadily consolidate, the top 25 converters still account for less than 50% of North American value-added flexible packaging sales compared to 70% in Europe.
“North America’s flexible packaging market is predicted to achieve a compound annual growth rate of 3.8% over the next five years, to reach over US$30 billion in 2023. The industry is likely to come under increasing margin pressure as competition intensifies and brand owners continue to drive down their costs.
“Rising concerns by consumers and environmental pressure groups regarding the recyclability of flexible packaging is driving the development of sustainable alternatives to traditional forms of plastic packaging. However, this will take time – there are no quick fixes.”
As noted in the report, the industry continues to be a hotbed for mergers and acquisitions, which is changing the structure of this still fragmented and over-supplied industry.