Market Trends of Carton Board Industry
Beverage Segment to be the Fastest Growing End User
- Beverages such as fruit juices, alcoholic beverages, and meal replacement shakes require paper packaging solutions. However, beverage quality is affected by pH, storage temperature, pressure, and the presence of contaminants. Changing the fill amount can change the composition of the drink. More and more companies use biodegradable packaging products with high barrier resistance (against heat, moisture, and bacteria) to prevent possible oxidation.
- Solid unbleached sulfate (SUS), or unbleached kraft paperboard, is a strong and printable material commonly used in the packaging industry. It is often used to make beverage boxes and containers, combining Kraft paper's sturdiness with a white finish. One side of the board is typically coated with a clay coating to make it suitable for printing.
- For many years, efforts have been made to increase the ability to recycle beverage containers. This has been achieved through joint investments with recyclers, technology suppliers, and equipment providers to build new facilities. In June 2023, Tetra Pak and Stora Enso invested roughly EUR 29 million (USD 31.5 million) in a new recycling line for beverage cartons in Poland. This line can multiply the country's yearly recycling capacity of beverage cartons - from 25,000 to 75,000 tonnes. It also provides the chance to recycle the entire amount of beverage cartons sold in Poland and those from neighboring countries such as the Czech Republic, Hungary, Slovakia, Latvia, Estonia, and Lithuania.
- This partnership with Stora Enso has resulted in one of the European Union's (EU) biggest recycling facilities for beverage cartons. This exemplifies how collective efforts can help preserve quality renewable materials from recycled cartons, such as paper fibers. As a member of the Alliance for Beverage Cartons and the Environment (ACE), Tetra Pak is dedicated to achieving the industry objective of having a 90% collection rate and a 70% recycling rate for beverage cartons in the EU by 2030. Moreover, liquid carton boards/tetra packs are one of the fastest-growing packaging types, driven by non-alcoholic beverages. According to the United States Department of Agriculture, Canada had the topmost juice market globally, with export volume totaling USD 484.53 million. This is followed by Japan with USD 84.41 Million and Mexico with USD 66.61 Million.
- Coupled with the rising awareness for recyclable packaging material and the robust recyclability feature of cartonboard, in February 2023, Tetra Pak and saveBOARD disclosed one of the first beverage carton recycler facilities in New South Wales, Australia. This is a major accomplishment toward the collective environmental objectives. It is the first of its kind in the country, and it will reuse the cartons to create low-carbon building materials for homes and offices without consuming any extra water, adhesives, or chemicals, thus making it a genuinely sustainable product.
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Asia Pacific is Expected to Hold Significant Market Share
- China's market for carton board packaging is projected to grow due to a growing urban population, an evolving e-commerce package industry, declining pulp prices, and improved awareness of the use of eco-friendly packaging. According to the China Paper Association, the consumption volume of paper pulp in China amounted to around 112.95 million metric tons in 2022, up from 93.87 million metric tons in 2018. This is expected to support the growing and consumption of folding cartons to increase the capacity for carton boards.
- Furthermore, the Chinese packaging sector continues to evolve and become more advanced. For the past few years, most fruit package options have been made of plastic; however, the trend is changing in the region with changing regulations from plastics to paper and carton packages. In addition, given the increasing concern about safety and environmental protection, safe packaging is set to become a significant focus for food packaging over the next few years.
- India's carton board growth is driven by continued demand for quality packaging of various FMCG products, pharmaceuticals, textiles, organized retail, booming e-commerce, and other segments. Additionally, Fruit pulp, juices, and other concentrates drive the growing demand for carton boards in India. The industry in India has gone up the sustainability curve and has become far more technologically advanced.
- The carton board market in Japan could be a valuable partner of the alcoholic beverages industry if it considers the government's objective to increase alcohol consumption and addresses evolving attitudes among young people. Cartonboard producers can take advantage of the increased demand for alcohol packaging and stimulate growth in the market, raise the government's tax revenues, or increase them if they emphasize innovation, sustainability, customization, and effective marketing.
- Australia has witnessed huge demand for corrugated packaging in the e-commerce sector. For instance, according to Australia Post, Year-on-Year sales growth increased for e-commerce industries like home and garden (37%), food and liquor (32%), hobbies and recreational goods (31%), variety stores (30%), fashion (27%), health and beauty (24%). Also, according to National Australia Bank, the distribution of online spending on homeware and appliances, department stores, grocery and liquor, personal and recreational, fashion, games, and toys in August 2021 accounted for 23.8%, 16.3%, 15.3%, 12.45, 10.9%, 8.9% respectively. This has increased the demand for secondary packaging, such as folding cartons, in the country.
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