The reducing poverty rate from 42% in 2000 to 25% in 2012 and increasing middle-class population has resulted in higher income for the people and also increase in urbanization. This increase in the retail market is compounding the growth of the economy of this region causing the active and intelligent packaging market to grow rapidly.
The Latin America active and intelligent packaging market is estimated to grow from USD 0.96 billion in 2016 to USD 2.56 billion by the end of 2021 at a CAGR of 17.79%. This rapid growth is attributed to the growing economies of the Latin American countries along with the increasing awareness among consumers.
Traditional packaging products cannot meet the requirements of food products such as meat and other frozen foods. These constraints have given rise to new technologies like active and intelligent packaging which promote longevity and freshness in the food products being consumed. Traditionally, these countries have had conservative habits like home cooked food and consuming fresh produce, however altering lifestyle of people has resulted in the shift from home cooked to ready-to-eat products. Increasing consumer awareness on issues like food safety and hygiene are the core drivers in the Latin American region and are expected to spur high growth in the coming years.
Packaging also plays a very important role in tackling the issue of counterfeiting, the advent of intelligent packing with the integration of technologies like radio frequency identification tags and near field communication devices has enabled manufacturing firms to keep track of their shipments and prevent any attempts to sabotage or counterfeit the products.
The major problem with this market is the striking socio-economic difference across various countries. The regions close to the urban areas have high GDP per capita which is very much different from the other regions. Also, Brazil, Mexico and Argentina are the major driving force of the region and the other countries are still not the major drivers in terms of economy and FDI. With this region getting a lot of investment and support from countries like the USA, the economic situation will improve and create more economic hubs across the region.
Some of the vendors mentioned in the report are BASF, Amcor Limited, Landec Corporation, Bemis, Rexam Plc and Sonoco.
Changing lifestyle of people, demand for packaging solutions with longer sustainability, demand for fresh and quality food are the major drivers for the growth of this market. Further, increase in counterfeit products in developing countries has also compelled companies to use technologies like RFID during packaging.
Issues regarding the effect of packaging materials on the human body, security and privacy issues in case of intelligent packaging systems are expected to be major challenges for the market’s growth over the next five years.
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