Latest data shows global packaging and industrial paper production lifted 6.2% or 15.3 million tonnes in 2021, as the pandemic raged strong across the world. The delayed data from the UN Food & Agriculture Organisation shows corrugated packaging production lifted 7.0% or 11.9 million tonnes to hit 183.6 million tonnes, just short of 70% of total packaging production. Source: IndustryEdge
Over the course of the decade, total global packaging and industrial (P&I) paper production lifted 25.1%, growing at an average annual rate of 2.3% per annum.
Although these are very broad definitions of the P&I grades, it is instructive that ‘Other’ forms of packaging are in decline, as Cartonboard, Case materials (corrugated packaging) and Wrapping papers grow their share.
One factor to consider is that within ‘Other packaging’ most analysts concur that the products are also changing. The rise of moulded fibre and laminated packaging (like liquid packaging boards) is being offset by declines in heavy grade boards and significant multi-plys, for example. The following material breaks the total production down, for each grade, by region.
Production of Cartonboard has increased an average 1.9% per annum over the last decade, after seemingly sliding in North America as plastics took hold. Recovery in 2021 saw production leap 6.9% to 50.3 million tonnes, marginally below the peak of five years earlier.
Always the dominant grade of P&I paper production and use the world over, corrugated packaging has barely skipped a beat over the last two decades, growing at a very solid 2.8% per annum over the last decade alone. Over the same period, global economic growth has averaged 2.1% per annum, meaning corrugated packaging demand is expanding faster than total economic activity.
Potent drivers, including e-commerce and of course most recently, the pandemic, assisted growth of 7.0% in 2021, on top of 4.5% growth a year earlier. For corrugated packaging, the pandemic was a boom time.
Seeming to languish, this omnibus of many fibre-based packaging substrates is also, as discussed earlier, in the process of changing. Squeezed by higher and better value uses of fibre, and also by packaging innovations, we can expect this grouping continue to decline, but some of the materials to flourish.
Our continually bullish assessment of the future for moulded fibre products, and our strong expectation of brand and consumer preference for liquid packaging boards are the obvious examples.
Mainly used in food packaging – but gifts as well! – wrapping papers continue to experience soft growth. The total volume of wrapping papers lifted to 19.9 million tonnes in 2021, but with growth at just 1.2% per annum over the last decade, the suspicion must be that the average grammage is declining at a reasonably fast rate. The likelihood is that a lot more square metres of wrapping papers are being used each year.
This is another sector likely to experience growth as sustainability concerns see plastic-based wrappings come under particular scrutiny.
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