Market Trends of China Plastic Caps and Closures Industry
This section covers the major market trends shaping the Chinese Plastic Caps & Closures Market according to our research experts:
Food and Beverage Industry to Drive the Growth of the Market
- The population of over 1.41 billion makes the Chinese food and beverage (F&B) industry enormous. According to Eastspring Investments Services Pte Ltd, its food and beverage (F&B) market are fast-growing. In 2021, revenue hit USD 176 billion, making up 63% of the global F&B revenue. The annual revenue growth rate is projected at 8.38% between 2021 and 2025. These three areas drive change and growth in the F&B industry. F&B brands that actively build a high-end image and launch differentiated products have an edge over competitors.
- Additionally, the demand for sports and energy drinks is expected to increase along with the need for bottled water over the forecast period, aided by the growing presence of suppliers across the country and increasing consumer adoption. For instance, according to chinabaogao.com, sales of sports drinks reached CNY 11.7 billion by 2021 from a total of about CNY 11.3 billion in 2016. In the same year, China's energy drink market was worth more than CNY 122 billion. This is expected to promote growth for the caps and closure market.
- The growing disposable income is increasingly considering environmental aspects of the packaging products for the selection of bottled water packaging materials. PET is increasingly being chosen instead of PVC because of its properties, such as lightweight, workability, and transparency. The high demand for bottled water and packaged beverages is driving the market for caps and closures in the beverage industry.
- Moreover, the growing production of non-alcoholic beverages in China is expected to support market growth in the projected timeframe. For instance, according to the National Bureau of Statistics of China, the country produced over 18.85 million metric tons of soft drinks in August 2022, which represented a decline of about 5.3 % from August 2021.
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Growing Demand from the Cosmetic Industry
- The increasing internet penetration among Chinese citizens is contributing to forming a sizeable digital society in the country. According to the China Statistical Report on Internet Development, in June 2021, the internet penetration rate in the country reached 71.6%, and the total number of internet users crossed the 1 billion mark. The increasing penetration will propel the growth of online shopping among the population.
- Additionally, the country is home to some of the biggest e-commerce companies. For instance, according to ITA, Alibaba's Taobao and Tmall, and JD.com are the domestic platforms that dominate China's e-commerce market. Other platforms include Suning, Gome, Vipshop, Yihaodian, Dangdang, Mogujie, and JuMei.
- Caps and closures have been used in almost all industries for products meant for storage and multiple-cycle consumptions. PP and PE are China's most popular materials for manufacturing caps and closures.
- Also, consumers in first- and second-tier cities in China rely on online retailers to buy cosmetics, boosting e-commerce sales. While more basic everyday amenities like soap or shower gel are most frequently purchased at supermarkets and grocery shops, the bulk of beauty goods is sold in specialist cosmetics chain stores, hypermarkets, supermarkets, and department stores offline. All this is expected to bolster the growth of the plastic caps and closures market in China. For instance, according to the National Bureau of Statistics of China, In 2021, the sales of cosmetics by wholesale and retail companies in China reached CNY 402.6 billion, which grew by 18.40% compared to last year.
