Plastic Packaging Growth to Continue to Outpace Paper Packaging

In selected packaging markets where paper and plastic compete, plastic’s overall volume share will continue to expand, reaching 49 percent by 2012.  This percentage understates plastic’s share since less plastic is required than paper in most applications due to its lighter weight.  Plastic’s share of the market will expand more slowly than in the past decade, as a number of packaging applications are now fairly mature in terms of the share controlled by plastic.  Nonetheless, material enhancements which enable extended shelf life and increased durability, along with reduced material requirements and the addition of convenience features such as resealability and steam cooking, will fuel continued opportunities for plastic packaging. These and other trends, including market share and product segmentation, are presented in Paper versus Plastic in Packaging, a new study from The Freedonia Group, Inc., a Cleveland-based industry research firm.

Plastic packaging growth is forecast to outpace that of paper packaging through 2012 in all competitive markets covered in this study and is projected to climb 2.4 percent per year through 2012.  Advances will result from plastic’s competitive cost and performance advantages, including light weight, moisture resistance, enhanced barrier properties and puncture resistance.  The fastest market share increases for plastic will occur in pet food and soy beverage packaging, with good opportunities also anticipated in protective packaging, foodservice, dairy product, fruit beverage and frozen food applications.

Slowest volume advances for plastic will occur in relatively saturated markets such as milk and baked goods, though plastic will log more rapid growth in smaller sized milk bottles, driven by conversions from gabletop cartons in schools and quick service restaurants.  Additionally, below-average growth for plastic in retail bags will be the result of environmental concerns and/or legislative restrictions. 

Due to inroads by plastic, paper consumption in most of these 17 markets will post marginal gains or continue to decline through 2012.  In a few markets -- soy beverages, foodservice, protective packaging, frozen food, dairy products, and meat, poultry and seafood -- paper demand is expected to climb above the average pace despite further inroads by plastic.  Despite a sluggish outlook for folding, aseptic and gabletop cartons in a number of these markets, aggregate rigid packaging demand will expand at a pace similar to that of flexible packaging based on above-average growth for tubs and cups, trays and other plastic containers such as clamshells and two-piece high visibility plastic containers. 

The Freedonia Group is a leading international business research company, founded in 1985, that publishes more than 100 industry research studies annually. This industry analysis provides an unbiased outlook and a reliable assessment of an industry and includes product segmentation and demand forecasts, industry trends, demand history, threats and opportunities, competitive strategies, market share determinations and company profiles.