Market Trends of United Arab Emirates Metal Packaging Industry
This section covers the major market trends shaping the United Arab Emirates Metal Packaging Market according to our research experts:
Increasing Urbanization and Rising Disposable Income May Drive the Market Growth
- Increased urbanization in the country is a driving factor for businesses to expand their capacity for producing metal cans and containers. Market participants are also being forced to increase their production capacity due to the spread of organized retail.
- Increased economic activity, a growing population, and growth in different socioeconomic engagements all affect the urbanization process in the country. Therefore, the country's socio-ecological initiatives are motivated by the urge to explore green packaging solutions such as metal packaging.
- Compared to the previous year (2020), which recorded 87.05%, the percentage of people living in the United Arab Emirates' urban areas increased slightly in 2021 to 87.3%. Nevertheless, the share rose to its maximum level throughout the year.
- Further, significant population shifts from rural to urban regions have occurred, and foreign labor has also been brought into Dubai. Dubai has become a dream city for international investors, businesspeople, and employees across all economic sectors because of government policies that support free trade and globalization.
- Furthermore, people in the UAE are spending more money due to the rising GDP and disposable income, driving the adoption of premium and eco-friendly packaging materials like metal packaging products. The convenience food and beverages market has shown remarkable growth as incomes and young consumers have grown due to rapid urbanization. Additionally, the buyer is encouraged to look for convenience in regular products like food due to working professionals' hectic schedules.
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Beverages Segment to Hold Significant Market Share
- Metal packing containers in the country are increasingly used in packaging due to their durability and portability. Nowadays, many beverage cans feature easy-open lids, which makes them more comfortable to use and better fits the fast-paced lifestyle of modern civilization. They are also commonly utilized in tourist locations. Beer, soda, and even wine are frequently packaged in aluminum cans.
- Owing to the increasing consumption of both alcoholic and non-alcoholic beverages, such as energy drinks and carbonated drinks, in GCC, there is significant demand for metal cans in the region. According to a new Dubai Chamber of Commerce report, the UAE's food and beverage trade grew steadily to more than USD 20 billion in the first nine months of 2021.
- Moreover, consumer trends, such as a preference for small-size and multi-pack packaging formats, are also supporting the volume growth of the metal cans market in the region. For instance, the Arab Beverages Conference stated that the beverage industry is one of the Arab world's rapidly growing industries. The vast majority of products offered at UAE marketplaces include juices, malt, non-alcoholic beverages, soft drinks, water, sports drinks, and cordials. Moreover, the beverage market was estimated significantly expand by June 2022, with the UAE markets reaching USD 1.2 billion.
- According to ITC, in 2021, UAE exported beverages, spirits, and vinegar valued at around USD 678.52 million, a 13% increase in exports from the previous year (2020), valued at about USD 600 million. The significant rise in exports of beverages increases the demand for metal packaging companies to increase their production capacities in the country.
- Further, the market for metal cans is expected to develop rapidly due to rising consumer awareness of using non-carcinogenic materials and increasing demand for lightweight packaging. However, the use of metal cans is being challenged by the prospect of replacing them with polymer-based packaging materials, such as polyethylene and polyethylene terephthalate.
