Market Trends of Mexico Flexible Packaging Industry
Pouches Expected to Hold Significant Share
- Pouches are extensively used in the food and beverage sector for various applications, including pet food, baby food, and liquid packaging (tea, coffee, and juices). As pouches are widely used and have a large footprint, there is growing concern about the environmental impact of plastic packing. Businesses are working to create a closed-loop economy to reduce plastic waste for the entire lifecycle of plastic packaging.
- Also, pouch packaging is rapidly gaining popularity, as it is a highly convenient and portable solution. Many of today's shoppers prefer flexible, stand-up pouches over traditional, rigid packaging. Consumers have exponentially driven demand for stand-up pouches over the past decade, whether for snacks, beverages, baby food, or industrial oils and lubricants.
- Furthermore, with the packaging industry undergoing a series of transformations to incorporate the best practices and ensure the highest recyclability levels, multi-material packaging structures are expected to be replaced by recyclable mono-material alternatives.
- Players operating in the e-commerce sector are opting for pouch packaging, as it is one of the most efficient and economical packaging solutions. Hence, the growing e-commerce industry in the country is expected to provide significant scope for market expansion. According to Worldpay Inc, e-commerce sales revenue in Mexico is expected to reach about USD 53 billion in 2024.
- The durability and convenience of logistics for products packaged in pouches drive the demand for the studied market. Furthermore, pouches' cost-effectiveness encourages manufacturers to opt for pouch packaging, driving the growth of this flexible packaging format. The lightweight nature of the structure drives the adoption of pouches compared to other traditional packaging formats like PET packaging.
- According to the Ministry of Economic Affairs (Mexico), cosmetic and personal care packaging grew significantly from USD 7.22 billion in 2020 to USD 7.24 billion in 2022, indicating the pouch became an essential aspect of packaging in most industries, especially the cosmetics industry worldwide. This is because it plays a vital role in product protection and privacy. The industry's rapid growth is also due to population growth, technological advancements in the cosmetics industry, and rising consumer demand.
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Pharmaceuticals Expected to Witness Significant Growth
- The developing significance of modern packaging in the pharmaceutical industry has led the brands to utilize the potential of characteristic flexible packaging to stand out from the rest of their competition and increase profitability. Apart from the basic condition of protecting the drug, the pack must also be appealing and sufficient to promote itself. Thus, the aesthetic appeal of flexible plastic packaging has contributed as a driving factor for its usage in pharmaceutical packaging.
- According to the International Trade Administration, Mexico is the world's 11th-largest pharmaceutical market and Latin America's second-largest after Brazil. Patented pharmaceuticals account for 51% of the Mexican pharmaceutical market by value, generics for 35%, and over-the-counter products for the remaining 14%. According to COFEPRIS, generics account for more than 80% of the market in terms of volume; the pharmaceutical industry has been significantly contributing to the growth of flexible packaging in the Mexican country.
- In January 2022, Bayer AG announced an investment of USD 358 million during the next three years in its pharma, consumer, and agriculture divisions under the slogan 'Health for all, no one hungry,' additional events and national campaigns will support this investment. Also, the company announced that it will strengthen its overall investment in its global pharmaceutical divisions to ensure sustainable competitiveness. Such instances are expected to boost the demand for flexible packaging.
- Characterized by the increased focus on child-resistant, tamper-proof packaging and the favorable initiatives for the circular economy, the studied market is expected to grow significantly in the forecast period.
- The demand for pharmaceutical products increased worldwide and will continue to grow in the coming time frame. This trend directly impacted the demand for flexible packaging options, and Mexico also increased the export of pharmaceutical products from USD 1.45 billion to USD 2.18 billion from 2020 to 2022, which was a positive sign for packaging needs in pharmaceutical products.
