Rising Demand for Southeast Asian Flexible Plastic Packaging Market

| 26/05/2009 | Reply

SINGAPORE,
May 24 /PRNewswire/
— Packaging is an intrinsic part of food in modern urban life. It is
also vital for export as it protects the contents and ensures that
quality products reach the consumer. Growth in the flexible plastic
packaging market for food is a function of the growth of the food and
food processing industry and growth in food exports. Countries such as
Malaysia and
Thailand have strengthened their position as ‘halal’ food exporters and have gained a share of the export market in the
Middle East, thereby, enhancing growth in this market.

New analysis from Frost & Sullivan, Southeast Asia Plastic Flexible Packaging Market for Food, finds that the market earned revenues of over
$1.41 billion in 2008 and estimates it to reach
$2.22 billion
in 2015. This is due to robust growth in the food processing sector and
the rise in demand for food exports as well as an increase in the
affluence of the urban population who tend to spend more on packaged
food. The countries covered in this research service are
Thailand,
Indonesia,
Malaysia,
the Philippines, and
Singapore.

“There has been a boost in the processed food industry in
Southeast Asia, owing to the modern lifestyle food needs of customers,” says Frost & Sullivan Research Analyst Sushmita Mahajan. “A mushrooming urban population drives demand for packaged food, consequently triggering the demand for packaging.”

Increasingly, rigid packaging is being replaced by flexible
packaging. The traditional benefits of rigid packaging can now be
achieved with flexible packaging with the added advantages of lower
cost and greater flexibility. Stand-up pouches and re-closable packs
offer merchandizing advantages and other marketing benefits to
fast-moving consumer goods (FMCG) manufacturers, similar to other rigid
forms of packaging.

“There are many food manufacturing multinational corporations (MNCs) that have set up their manufacturing base in
Southeast Asia and source their packaging needs locally,” explains Mahajan. “This aids the growth of the packaging industry.”

Flexible pouches with re-sealable closures consume lower energy and
emit less greenhouse gases than rigid packaging. Flexible packaging
also has a cost advantage over rigid packaging, including
transportation, consuming about 17 percent less energy compared to
rigid packaging. Furthermore, flexible packaging scores better than
rigid packaging in terms of solid waste generation. This trend of
favoring flexible packaging over rigid packaging acts as a key driver
for growth.

Growth is likely to be driven by the rise in demand for packaged
food from the affluent, urban middle-class as well as the intensifying
need to meet the changing lifestyles of customers. The growth in demand
for exports is another factor enhancing the food industry, consequently
driving the food packaging industry. Changes in technology and the
replacement of rigid packaging with flexible packaging also act as
catalysts for market expansion.

The highly volatile price of raw materials is a primary concern for
packaging manufacturers. When the price of raw materials escalates, the
higher cost cannot be passed on to food companies completely due to
fierce competition in the packaging market.

Heightened environmental concerns also pose a challenge, motivating
packaging manufacturers to devise improved packaging solutions. This
may lead to more widespread usage of bio-plastics in the future. In
Southeast Asia, bio-plastics are currently perceived as a niche market, while being beset by cost and performance issues.

Polymer resins constitute 60 percent of the cost of production of
packaging materials. Therefore, fluctuations in raw material prices are
a key concern for packaging manufacturers.

A controversial issue concerning plastic packaging is that it is
non-biodegradable and contributes to carbon emissions. Though most
plastics used in packaging are recyclable, it is difficult to separate
plastics by polymer type for recycling, especially the multi-layer film
for packaging.

“Flexible laminates with multilayer packaging made up of similar
polymers such as polyethylene (PE) and polypropylene (PP) or oriented
polypropylene (OPP) and PE have different properties, making it
complicated to recycle,” explains Mahajan. “With improved technology,
wider acceptance and improved economies of scale, expensive
bio-plastics with applications currently only in niche areas will find
wider application in food packaging.”

Currently, rising environmental awareness has resulted in greater
emphasis on the use of green products. Rapid technological strides and
enhanced consumer education will result in the more widespread
acceptance of bioplastics by Southeast Asian consumers.

“Mounting environmental concerns will reinforce efforts to increase
the sustainability of packaging, thereby, opening up opportunities for
degradable films,” concludes Mahajan. “However, these need to be
further developed in order to overcome performance limitations.
Presently, the main obstacle to their widespread usage is their high
price and most current applications for biodegradable plastics are
niche with unique environmental considerations.”

If you are interested in a virtual brochure, which provides a brief
synopsis of the research and a table of contents, then send an e-mail
to Donna Jeremiah, Corporate Communications, at djeremiah@frost.com,
with your full name, company name, title, telephone number, company
e-mail address, company website, city, state and country. Upon receipt
of the above information, a brochure will be sent to you by e-mail.

Southeast Asia Plastic Flexible Packaging Market for Food is part of the Chemicals & Materials
Growth Partnership Service program, which also includes research in the
following markets: Chemicals & Materials, Market Engineering and
Chemicals, Materials & Food, Market Engineering. All research
services included in subscriptions provide detailed market
opportunities and industry trends that have been evaluated following
extensive interviews with market participants.

Frost & Sullivan, the Growth Partnership Company, enables
clients to accelerate growth and achieve best in class positions in
growth, innovation and leadership. The company’s Growth Partnership
Service provides the CEO and the CEO’s Growth Team with disciplined
research and best practice models to drive the generation, evaluation,
and implementation of powerful growth strategies. Frost & Sullivan
leverages over 45 years of experience in partnering with Global 1000
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than 35 offices on six continents. To join our Growth Partnership,
please visit http://www.frost.com.

Category: Asia, Food Manufacturing

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