Market Trends of Latin America Soft Drinks Packaging Industry
This section covers the major market trends shaping the Latin America Soft Drinks Packaging Market according to our research experts:
Plastic is Expected to Hold the Significant Share
- Plastic bottles are usually preferred for packaging soft drinks as they are cheaper, easier to transport, and safer. Also, plastics are energy efficient to manufacture, and they are also lighter than alternative materials.
- The adoption of PET plastic bottles helps in weight reduction as compared to glass, allowing for a more economical transportation process. Additionally, better mechanical qualities reduce weight compared to PE and PP bottles. Further, the availability of recycled plastic in the region is considered among the cheapest. This has also helped increase the rate of recycling PET in the region.
- With the expansion of the soft drinks market in Latin America, it is clear that nutritional product demand, such as juices, energy drinks, and sports drinks, is increasing and driving the soft drinks packaging market. For example, in September 2021, Pepsi Cola said it would invest USD 64 million to increase production in the Colonia del Sacramento free trade zone in Uruguay.
However, because of the growing environmental concern about the use of plastic for soft drink packaging, which is hazardous, manufacturers and consumers in Latin America are turning to environmentally friendly alternatives to plastic. For instance, in May 2022, SIG launched combistyle carton packaging with Frimesa, one of Brazil's largest milk companies.
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Brazil to Contribute Significant Market Share
- Brazil's polyethylene terephthalate (PET) stretch blow molding industry is significantly growing, propelled by carbonated soft drinks, health drinks, and most recently, aseptically filled products like milk beverages, fueled by rising incomes for large segments of the world's fifth-most populous nation that are making things like bottled water and soda newly accessible to everyday Brazilians.
- The companies are investing in Brazil to maintain a better position to serve their customers' growing needs for beverage cans for soft drinks. For instance, in July 2022, Canpack S.A. announced that it would increase its manufacturing capacity of aluminum beverage cans with a new production plant in Pocos de Caldas, Brazil, with an investment of approximately BRL 710 million (USD 140 million), which will be operational in 2024. The capacity of the plant will initially be around 1.3 billion cans per year.
- Furthermore, in February 2022, metal packaging leader Trivium Packaging announced an investment in two of its new manufacturing plants to expand the production of aluminum impact-extruded cans and bottles. In 2023, new lines will be added to the facilities in Youngstown, Ohio, and Itupeva, Brazil. This will give the facilities new capabilities and a lot more space.
- Coca-Cola's report for the second quarter of 2022 says that sales of soft drinks have gone up by 8%. This is due to growth in all geographic operating segments, but Mexico and Brazil have led the way. In addition, nutrition, juice, dairy, and plant-based beverages grew by 6%, led by Del Valle in Latin America.
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