Market Trends of China Plastic Packaging Industry
This section covers the major market trends shaping the China Plastic Packaging Market according to our research experts:
E-commerce Industry is Driving the Market
- To reduce transportation costs, e-commerce enterprises prefer lightweight and flexible packaging solutions. The increased popularity of online shopping for regular fresh foods, FMCG products, electronics, and clothing is likely to propel the plastic packaging market.
- The e-commerce boom in China has compelled packaging companies and resellers to explore sustainable packaging alternatives, including recycled plastics. Such initiatives will likely boost different types of plastic packaging used for e-commerce in the coming years.
- Moreover, with the growing usage of plastic packaging in the e-commerce sector, players like Alibaba and JD.com have launched various recycling efforts. For instance, Unilever and Alibaba Group launched the 'Waste Free World' Initiative in March 2021, a first-of-its-kind AI technology-driven closed-loop plastic recycling system in China. Unilever will merge its packaging technologies with Alibaba's business operating system as part of the partnership to encourage consumers to adopt recycling of waste.
- China has the most online buyers and sellers worldwide, aided by being the world's most populous nation. According to the China Internet Network Information Center, at the end of 2021, it had 842.1 million online consumers, more than twice the US population, which is the next largest e-commerce market. Such rapidly growing sales through e-commerce platforms in the country positively support the market growth with flexible packaging demand.
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Bottles are Observing Significant Increase
- Among the most commonly used beverage bottles, plastic bottles are some of the most common types used by beverage manufacturers. PET is a popular choice for plastic bottles due to its good strength-to-weight ratio, cost reduction, and transportation savings compared to glass counterparts, and its safety and reliability for consumer products. Considering the manufacturing process, PET is engineered to be a strong yet pliable material that enables its use in different plastic bottles. Additionally, its recyclability and the ability to customize it with various colors and designs make it a popular choice.
- Manufacturers are witnessing the expansion in the use of plastic bottles and increasing demand for them in some sectors. Among significant beverage categories, carbonated soft drinks (CSD) and water grew faster than the others, driven by senior consumers and higher income groups. The most growth in beverage servings was seen in entertainment, vendor/drink station, and coffee/bakery channels during 2021.
- The primary beverage producers in China registered double-digit growth in the year 2021. For instance, according to the Ministry of Industry and Information Technology, in 2021, major beverage producers in China saw their output rise 12% yearly to over 183 million tonnes.
- Moreover, beverage manufacturers are expanding their business in China to fulfill the increasing demand for soft drinks. For instance, in October 2021, Swire Coca-Cola Ltd, a bottler of Coca-Cola beverages, announced the investment of more than CNY 5.5 billion (USD 854 million) in factory infrastructure in China in the next five years and planned to expand nearly 20 production lines to cash in on the rapid growth of its businesses in China. Such beverage manufacturing investments are further adding demand for rigid plastic packaging products.
