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Shift to flexible packaging in a big way
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Tuesday, 02 June, 2009, 08 : 00 AM [IST]
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Sabyasachi Samajdar, New Delhi
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Indian market for packaging materials is estimated at around Rs 400 billion per annum. Of this, the consumer packaging market of the country is valued at around Rs 180 billion. Indian packaging sector is expected to grow at 8-10% per annum.
Packaging is the key issue for the processed food industry, thus packaging materials manufacturers can look forward to a growing market. The packaging industry in India is still growing and the market is dominated by flexible packaging formats.
The traditional rigid packaging users are migrating to flexible packaging in a big way. Laminated products including form-fill-seal pouches, laminated tubes and tetra packs are growing at around 30% per annum. There are about 600-700 packaging machinery manufacturing units, 95% of which are in the small and medium sector located all over India.
Indians are becoming more health conscious. There is also a move towards packaged, branded products rather than the unpackaged formats. Even the common man is becoming conscious about the quality of water, the standard of cooking oil, calorie intakes etc.
Healthier living has resulted in a growing demand for PET bottles in the bottled water sector. Similarly, a significant shift away from loose unbranded low-quality cooking oil has translated into increase in demand for PET and HDPE bottles. More and more consumers are also realising the need for nutritive drinks, showing a preference for juice drinks, 100% juices, milk drinks against carbonates or concentrates, thereby pushing up demand for liquid cartons.
Flexible packaging dominates the food packaging being used for a variety of food items ranging from milk, biscuits, vegetable oil to rice. Fresh/pasteurised milk is one of the main end-use applications for flexible packaging.
Glass packaging is believed to add status and value to a product. Consumers perceive glass as a premium material with high quality. This is especially true in sectors like alcoholic beverages and fragrances. Spirits, as a whole, is the largest consumer of glass bottles in India. In the foods market, glass bottles are best suited and hygienic for products that contain reactants like tomato ketchup, herbs and spices. Glass was the second most popular packaging format in the entire packaging industry but glass containers are gradually losing their market. The unpopularity has been mainly due to the high rate of breakage and the inconvenience of returning the empty glass bottles after consumption. As a result, glass containers recorded the lowest growth.
According to D P Tripathi, Senior Advisor, Corporate and Legal Affairs, Aseptic Food Processing and Packaging Association, the Indian retail market is witnessing a massive boom, with many well-established business houses investing heavily in this sector. The sector is soon going to offer a choice of products for the consumer from not just India, but also cheaper options from South-east Asia. With free trade amongst South Asian countries coming into place, sooner than later, a variety of new products are likely to appear on shop shelves. Though open markets will revolutionise trade in the region, it could also spell disaster for Indian companies that sell products using the best technology available today -- in aseptic packages. Lower-priced, aseptically packaged products from South and Southeast Asia are going to compete with Indian products that will find themselves more expensive because of India's high taxes, Tripathi added.
Currently, members of the Aseptic Food Processing and Packaging Association use technologically advanced machinery only in the aseptic processing of semi-solid foods, fruits/fruit juices and milk/milk products, it is learnt.
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