Market Trends of Asia Pacific Beverage Packaging Industry
This section covers the major market trends shaping the APAC Beverage Packaging Market according to our research experts:
Beer is Expected to Account For Significant Market Share
- The consumption of beer has been increasing exponentially in the recent past. India remains one of the largest beer markets, with more than 20 million people entering the legal age for drinking every year. In addition, United Breweries, India's most prominent beer producer that also makes the famous Kingfisher brand, has announced their latest Kingfisher Instant Beer. The product is sold in a box that contains two sachets.
- The traditional packaging material used for beer in the region is the glass bottle sealed with a crown closure. As glass is extensively used for alcohol packaging in the area, the demand is expected to increase during the forecast period. Also, glass prices have a significant impact on the margin profile of the alcohol companies, which fluctuates based on the crude oil price movement.
- Owing to the uncertain margins, manufacturers are gradually incorporating other packaging materials in their production lines. A recent development is the use of PET bottles for the packaging of both alcoholic and non-alcoholic beer. The PET beer bottles used are non-tunnel pasteurized, one-way tunnel pasteurized and returnable/refillable bottles.
- Beer needs high CO2 and O2 barrier performance compared to PET used in carbonated soft drinks (CSD). The level required depends on the type of beer, container size, distribution channels, and environmental conditions (storage time, temperature, and humidity levels).
- Moreover, in this region, consumers are increasingly shifting toward gluten-free beers. Also, beer consumption grows at over 6 percent per annum in China, India, and Vietnam. Hence, the growing innovation in flavors and preparations is likely to drive the demand for beer, increasing beer cans' growth. For instance, Heineken, an Amsterdam-based company, increased its stake in Bangalore-based United Breweries, India's largest beer manufacturer, thereby offering high growth potential for the beer packaging industry in the country, which will raise the usage of beer cans.
- Further, Japanese companies are striding up their business by product innovation in Southeast Asia to cash in on the region's growth. For instance, in March 2021, Toyochem Co., Ltd., the polymers and coatings subsidiary of Japan's Toyo Ink Group, launched a new Bisphenol A non-intent (BPA-NI) internal coatings for metal beer bottles and cans. The new BPA-NI interior sprays and coil coatings for stay-on tab (SOT) ends are formulated to achieve the required performance based on acrylic emulsion and polyester resins. It is also addressing BPA-related health and food safety concerns from regulators and consumers alike. In addition, Toyochem will be marketing its BPA-NI solutions under the new brand name Lionova, as the company also seeks to expand its position in markets overseas.
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India to Expected to Witness Significant Rate of Adoption
- In terms of India's beverage packaging, glass and rigid plastic hold a prominent share of the market. PET is the material that is used for packaging water, which accounts for around 55% of India's packaged water sector.
- The growth of the packaging market in India is primarily driven by the food and beverage industries. According to IBEF, the Indian food and grocery market is the world's sixth-largest, with retail contributing to 70% of the sales.
- The increase in the spending capacity of the middle-income group, the rapid expansion of organized retail and exports further facilitate the growth of the market. This has led to the need for standardized packaging, which can improve shelf-life, maintain production speed, and simultaneously ensure quality.
- Thus, adopting advanced packaging methods to ensure quality has become critical for India's food and beverage industry. According to the National Packaging Conference held by the Confederation of Indian Industries in January 2020, the food and beverage industries and e-commerce accounted for 50% of the packaging industry.
- Further, in July 2020, Fabonest Food and Beverages has launched spring water beverages in sustainable and endlessly recyclable aluminum cans in India to keep up India's sustainable development goals.
- According to the Indian Institute of Packaging (IIP), packaging consumption in India increased by 200% in the past decade, rising from 4.3 kg per person per annum (pppa) to 8.6 kg pppa. However, despite this growth, the per capita consumption of India is the lowest among the large economies of the world. This further emphasizes the future growth potential of the market.
- Further, in June 2021, Del Monte, the premium packaged foods brand from FieldFresh Foods, has announced its packaged King Coconut Water launch, renowned for its superior health and taste benefits. Del Monte is the first brand in India to offer King Coconut Water. It raises the bar in the fast-growing packaged coconut water segment as consumers increasingly adopt healthier lifestyles.
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