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The North American retail bags market is expected to record a CAGR of 5.57% over the forecast period (2022-2027). The rapidly increasing number of supermarkets, shopping malls, and developed retail sectors has been significantly feeding the global demand for retail bags. The retail bags market is increasing exponentially due to grown retail industries linked with the growing choice for eco-friendly packaging among customers.
- Increasing bans and regulations for plastic material usage in retail bags have incrementally pushed paper material usage, which is expected to drive the retail bag market during the forecast period. Also, increasing bio-based plastic use and recycling is expected to play an essential role in the plastic material segment in the retail bag market.
- As of 2020, nine U.S. states have restrictions or bans on plastic bag use, and 13 states have local ordinances about bag use (Sea Grant Law Center 2020). Recently, Ohio has been in the process of eliminating the local plastic bag ban for Cuyahoga County, which the Governor has currently paused because of the pandemic. The establishment of preemption laws in Ohio is contrary to what has been shown by several studies in Ohio ( Hardy and Bartolotta, 2021). The study reflects that most of the respondents favor the plastic bag ban. This will increase the retail bag industry as a more environmentally friendly option and drive the sector in the near future.
- As per the FDEP 2021 report on retail bags, in the 2021 Legislative Session, Section 403.7033, F.S. was amended to require DEP to review and update the 2010 Retail Bags Report and submit this report to Legislature by December 31, 2021. The Statute directed the report to include an analysis of the need for new or different regulations of wrappings and auxiliary containers. The new report is expected to suggest the use of an alternative method of carrying products from the perspective of benefits of using retail bags being more environmentally friendly, and the use of retail bags will increase, which will further drive the market.
- The covid pandemic has offset the driving factors for reusable bags and has caused a setback in the ban on single-use plastics. With early 2021 concerned about the risks of infection spread, the allied consumers of retail goods went back to throwaway packaging.
- Due to the pandemic in the North American region, many states in the United States and Canada implemented bag ban preemption laws (Sea Grant Law Center 2020), preventing local governments from enforcing plastic bag bans or bans on other single-use plastic items such as Styrofoam or carryout containers. For instance, recently, Ohio has been in the process of eliminating the local plastic bag ban for Cuyahoga County, which the Governor has currently paused because of the pandemic.
Scope of the Report
The North American retail bags market considers the sales of single-use paper-based retail bag products. The study considers only the revenue that is generated at the first point of sale-direct sales to the final end-users, distributors, etc. The study offers the global trends pertaining to the technological innovations, major trends, factors influencing the demand, strategies of the key players, and market size in terms of various end-users, regions, and product types.
Key Market Trends
Increasing Demand for Sustainable Packaging Alternatives in the Retail Sector
- As per the study by the American Forest and Paper Association 2021, the study shows 94% of Americans have access to community paper recycling programs. There has been an increase of about 14 million people since 2014. About 79% of Americans had access to residential-curbside recycling programs in 2021.
- The growing preference toward eco-friendly packaging has led retailers to shift focus toward paper-based bag packaging for general public consumers of today and the future as the consumers view paper to be the most eco-friendly alternative to plastic. According to industry experts, plastic takes approximately 100 to 500 years to decompose and causes pollution. Therefore, paper is considered one of the best biodegradable materials for manufacturing retail bags.
- As per the American Forest and Paper Association and Forest Products Association of Canada, Paper is one of the most recycled materials in North America, with a recovery rate of 68% in the United States and 70% in Canada. These figures reflect the increasing trend and focus has been shifting toward the use of paper for manufacturing of carrying bags in the region.
- Organizations and consumers across the world are favoring recycled paper bags to curb deforestation issues in conventional paper production for retail bags. This recycled paper has a similar quality to conventional paper and can be used for making strong bags to contain various retail products. Also, due to the increasing costs and consumption rates of wood-based paper, consumers are starting to look for alternatives to minimize the impact on the environment.
- As per the American forest and paper association, paper is one of the most recycled materials, which is confirmed by continuously high recycling rates. In 2021, the recycling rate for cardboard boxes was 91.4%, and the paper recycling rate climbed to 68%. The figures reflect the shift in consumer behaviors toward paper bags.
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Government Regulatory Accounted to be the Key to Drive the Market
- State legislatures have considered measures to reduce plastic bags at grocery stores and other retail businesses for carrying products. Reducing plastic bag use can mitigate harmful impacts on rivers, oceans, lakes, forests, and wildlife.
- Some states are focusing on implementing effective recycling programs and imposing fees or bans to discourage the use of plastic bags altogether. It can also relieve pressure on landfills and waste management.
- SUCP bans have been implemented in New Jersey, Colorado, and New York, while states such as Indiana, Arkansas, and Ohio continue to prohibit local governments from banning SUCP.
- Documentation on the effectiveness of SUCP is limited. A California study reported for the San Francisco Bay Area the effects of a SUCP ban (Taylor et al., 2019). The study found that they estimated the ban eliminated GBP 40 million of carryout plastic bags but that this was offset by a GBP 12-million increase in trash bag purchases.
- Other regulatory options that have grown in use in some US states and municipalities include fees on plastic bag use, requiring certain minimum recycled content in SUCPs, and requiring retailers to provide recycling options.
- As per The American Forest & Paper Association (AF&PA) report released on April 2022, total packaging papers & specialty packaging shipments in April decreased two percent compared to April 2021. They were up one percent compared to the same four months of 2021. Many paper products used every day across the US have an 80% or more community access rate, which means things like newspapers, cardboard boxes, pizza boxes, and paper bags are widely accepted for recycling.
- With more states across the United States banning single-use plastic bags, the need for paper shopping bags continues to grow. In fact, the state of New Jersey is set to implement one of the strictest bans in the nation starting on May 4, 2022.
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The North American US retail bags market is highly fragmented with the size is currently growing. Changing policies regarding the use of plastics and paper are driving the market. With the growing demand for retail bags, high competition is due to low entry barriers. Large packaging companies in the market pose a threat to small vendors in the retail bags market. The market comprises small and some principal players such as Mondi Group PLC, El Dorado Packaging, Inc., Novolex Holdings Inc., and Smurfit Kappa Group PLC.
- April 2022 - Kari-Out Company, manufacturer, importer, and nationwide distributor of paper, and recyclable food container ingredients in the restaurant takeout industry, announced that it acquired Paper Bags USA, based in New Brunswick, NJ. With more states across the United States banning single-use plastic bags, the need for paper shopping bags continues to grow. In fact, the state of New Jersey announced to implement one of the strictest bans in the nation starting from May 4, 2022.
- April 2022 - TricorBraun announced an agreement to acquire PBFY, flexible packaging distributors in North America, from retail and promotional packaging supplier Pacific Western Sales (PWS). The acquisition expands TricorBraun's flexible packaging division, TricorBraun Flex.
- February 2022 - ProAmpac, and material science, announced that it acquired Belle-Pak Packaging, a manufacturer of flexible packaging products. ProAmpac is looking to expand its presence in Canada with the addition of Belle-Pak and extends its reach in healthcare, high-growth e-commerce, and logistics end markets.
- May 2022 - Smurfit Kappa developed AquaStop sustainable water-resistant paper as part of Smurfit Kappa’s new TechniPaper portfolio because of a special coating added to it during the manufacturing process without compromising the recyclability of the product.
- May 2022 - Eco-Products part of Novalex introduced a new compostable wrap ideal for swaddling sandwiches and snacks. With more restaurants seeking carryout and delivery options made from wax paper, it is ASTM D6868 compliant and is certified by the Biodegradable Products Institute.
Table of Contents
1.1 Study Assumptions and Market Definition
1.2 Scope of the Study
2. RESEARCH METHODOLOGY
3. EXECUTIVE SUMMARY
4. MARKET INSIGHTS
4.1 Market Overview
4.2 Industry Attractiveness - Porters Five Force Analysis
4.2.1 Threat of New Entrants
4.2.2 Bargaining Power of Buyers/Consumers
4.2.3 Bargaining Power of Suppliers
4.2.4 Threat of Substitute Products
4.2.5 Intensity of Competitive Rivalry
4.3 Assessment of Impact of COVID-19 on the Market
5. MARKET DYNAMICS
5.1 Market Drivers
5.1.1 Increasing Demand for Sustainable Packaging Alternatives in the Retail Sector
5.1.2 Stringent Government Regulations Against the Use of Single Use Plastic bags
5.2 Market Restraints
5.2.1 Fluctuating Raw Material Prices and Supply Chain Disruptions
6. MARKET SEGMENTATION
6.1 By End-User
6.1.1 Grocery Stores
6.1.2 Food Service
6.1.3 Other Emd-users
6.2 By Country
6.2.1 United States
7. COMPETITIVE LANDSCAPE
*List Not Exhaustive
7.1 Company Profiles
7.1.1 Novolex Holdings Inc.
7.1.2 Smurfit Kappa Group PLC
7.1.3 Mondi Group PLC
7.1.4 El Dorado Packaging Inc.
7.1.5 International Paper company
7.1.6 Jet Paper Bags
8. INVESTMENT ANALYSIS
9. FUTURE OF THE MARKET
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Frequently Asked Questions
What is the study period of this market?
The North America Retail Bags Market market is studied from 2020 - 2027.
What is the growth rate of North America Retail Bags Market?
The North America Retail Bags Market is growing at a CAGR of 5.57% over the next 5 years.
Who are the key players in North America Retail Bags Market?
NovolexHoldings Inc, Smurfit Kappa Group PLC, Mondi Group PLC, el dorado packaging inc (ProAmpac), International Paper company are the major companies operating in North America Retail Bags Market.