Market Trends of Vietnam Plastic Packaging Films Industry
Polyethylene Segment Is Expected to Witness Significant Growth
- ChemOrbis reported that for the week ending January 19, 2024, LDPE film import prices in Vietnam were assessed in the range of USD 1020-1100/ton. Meanwhile, HDPE film prices ranged from USD 1010-1070/ton, and LLDPE film prices stood at USD 970-1050/ton, all on a CIF basis. Compared to the prior week, LDPE film prices surged by USD 50-100/ton, HDPE film saw an increase of USD 20-50/ton, and LLDPE film remained stable or rose by up to USD 20/ton.
- The price increases, especially the significant spike in LDPE film prices, indicate strong demand for polyethylene films. Rising consumption in sectors such as food, agriculture, and consumer goods could drive this demand. Strong demand supports market growth as manufacturers ramp up production to meet it.
- The rise in plastic imports suggests a greater availability of raw materials, such as polyethylene, necessary for manufacturing packaging films. This increased supply can support the production capacity of local manufacturers, enabling them to meet higher demand and explore new markets.
- An article by the General Statistics Office of Vietnam, published in June 2023, reported that in 2022, Vietnam's imports of plastic in primary form were valued at around USD 12.4 billion, marking a notable surge from USD 7.58 billion in 2017.
- The significant import value may also reflect investments in higher-quality or more advanced forms of plastic. Access to better raw materials can lead to improvements in the quality and performance of polyethylene packaging films, making them more attractive to various industries, such as food, pharmaceuticals, and consumer goods.
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Food Segment to Show Significant Growth
- The surge in retail sales indicates a rise in consumer spending. With higher disposable incomes, consumers are more likely to purchase a variety of products, including packaged goods. This, in turn, increases the demand for plastic packaging films used in food, beverages, and other consumer goods.
- Vietnam’s General Statistical Office reported in its July 2023 publication that Vietnam's total retail sales surged by 13% in 2022, reaching USD 192 billion. This growth was propelled by a resurgence in domestic consumption, buoyed by the country's record-high GDP growth of 8.02%.
- This transition is chiefly propelled by two factors: the swift growth of the middle class and the country's predominantly youthful population. With convenience stores, coffee shops, snack outlets, and the more comprehensive retail and hospitality landscape thriving, the demand for plastic packaging films is poised for a significant upswing.
- The rising consumption of food in the country has directly influenced the growth of the retail industry, presenting a lucrative opportunity for plastic packaging film manufacturers to view Vietnam as a significant market in Southeast Asia.
- The country's increasing consumption of food is the primary driver behind the significant demand for various packaging modes, notably plastic packaging films. For instance, according to the General Statistics Office of Vietnam, the country's food and beverage consumption was USD 26.07 billion in 2019, and it is forecasted to increase to USD 51.36 billion by 2024.
