Global Industrial Packaging Market (by Material Type, End User, & Region): Insights and Forecast with Potential Impact of COVID-19 (2023-2028)

Industrial packaging refers to specific, heavy-duty customized packing solutions designed for wrapping, containing, and sealing finished fast-moving consumer goods (FMCG) during storage and distribution procedures. The industrial packaging market consists of sales of industrial packaging solutions by entities (organizations, sole proprietorships, and partnerships) that assist in preparing goods for transport, warehousing, logistics, sales and end use, and protecting the products from damage or contamination.

Drums (steel, plastic, and fibre), intermediate bulk containers (flexible and rigid), sacks, pails, and crates/totes are all common packaging formats in this industry. Economic growth is the primary driver of industrial packaging usage, particularly the health of the key industries it serves. The development of the industrial packaging market is primarily focused on sustainability, recycling, and reuse/reconditioning. Down-gauging is an important driver of innovation in many consumer packaging formats, as it reduces the material used while maintaining performance. Increased container re-use and the establishment of a reconditioned drum infrastructure are also factors promoting sustainable solutions in industrial packaging as well as business opportunities. The global industrial packaging market is expected to reach US$68.91 billion in 2023, progressing at a CAGR of 5.02% over the projected period.

Segment Covered

By Material Type: In terms of material type, the report offers insights of the global industrial packaging market into seven segments: corrugated boxes, intermediate bulk containers (IBC), sacks, drums, pails, crates and others. Corrugated boxes industrial packaging market is both the largest and fastest growing segment of global industrial packaging market as corrugated box packaging are ideal for packing a wide variety of items that are independent of size & form and offers other benefits such as modification and customization of boxes to meet specific company requirements.

By End User: On the basis of end user, the report provides the segmentation of the global industrial packaging market as follows: food & beverages, chemicals & pharmaceuticals, building & construction, agriculture & horticulture, plastics & rubber, oil & lubricants and others. Food and beverages industrial packaging market held the largest share of global industrial packaging market, owing to rapidly expanding population, rapid urbanization, shift in consumer’s preference towards consumption of packaged & processed food, rising demand for customized industrial packaging & increased sales of daily essentials, FMCG, and fresh food through e-commerce and online platforms.

Geographic Coverage

According to this report, the industrial packaging market is divided into four regions namely North America, Europe, Asia Pacific and rest of the world. The countries covered in North America region are the US, Mexico, and Canada, while Europe includes Germany, France, Italy, UK, Spain, and Rest of Europe. Moreover, China, Japan, India, South Korea and Rest of Asia Pacific are included in the Asia Pacific region. The Asia Pacific industrial packaging market in the largest & fastest growing region of global industrial packaging market owing to growing working population, rise in currency rates, increasing e-commerce sales, rising per capita income of individuals and increased benefits offered by industrial packaging solutions in the form of safety, cost effectiveness, durability, strength, environmental friendliness and logistics convenience. China industrial packaging market held the largest share in Asia Pacific industrial packaging market owing to massive demand from the food packaging industry, increasing retail sales of grain, oil, and food & beverages, and stable growth in industries such as automotive, construction and healthcare. Also, on the basis of end user, Asia Pacific industrial packaging market is divided into five segments namely, food & beverages, chemicals & pharmaceuticals, building & construction, oil & lubricants and others, where chemicals & pharmaceuticals is the fastest growing segment and food & beverages held the largest share of Asia Pacific industrial packaging market.

Top Impacting Factors

Growth Drivers

• Rising Demand from End User Industries
• Rise in Modern Retailing
• Increasing E-commerce
• Globalization

Challenges

• Volatility in Raw Material Prices
• Recycling and Environmental Concerns

Trends

• Increased Integration of Artificial Intelligence (AI)
• Emergence of Sustainable and Recyclable Packaging Materials
• Increasing Adoption of Nanotechnology
• 3D Printing

Driver: Increasing E-commerce

Rising disposable income, increased internet penetration and shift in consumer’s preference towards online shopping has positively contributed towards rise in e-commerce and increasing demand for industrial packaging solutions as with people increasingly ordering goods online, there has been a rising use of packaging material with each good being delivered individually packaged rather than in bulk to a store. Also, there has been an increasing use of protective industrial packaging for safe transportation of good in case of a possible return of a product by customer along with increasing demand for industrial packaging solutions for timely delivery of raw material and finished good while maintaining quality of product, contributing positively towards rapidly growing industrial packaging market.

Challenge: Volatility in Raw Material Prices

There has been an increasing fluctuations in the supply of raw materials & basic chemicals that are used in the production and manufacturing of packaging materials. For instance, crude oil and natural gas are major sources of naphtha and ethylene which are used to manufacture polypropylene, polystyrene, EPS Styrofoam, polyethylene & polyurethane, used as raw materials in the manufacturing process of insulated packaging. So, with fluctuating prices of crude oil and increasing cost of raw materials, the prices of industrial packaging solutions are also increasing, impeding the growth of global industrial packaging market. Also, small vendors reducing their profit margins to maintain consistent prices of industrial packaging solutions is further hindering the growth of industrial packaging market as low and reduced profit margins of industrial packaging players decreases the industry’s attractiveness and results in major losses and closure of many industrial packaging businesses. Therefore, low penetration of industrial packaging market in developing countries as a result of price volatility of raw material and fluctuating prices of industrial packaging solutions will continue to impend the growth of global industrial packaging market.

Trend: Increasing Adoption of Nanotechnology

Nanotechnology has increasing number of applications on various phases of packaging supply chains, ranging from packaging material to product safety, authentication and tracking. Industrial packaging companies use nanoparticles by mixing them with polymer chains to enhance package barrier properties and tensile strength of packaging materials. Also, by applying nanocoatings on the packaging surfaces of various products, companies use nanotechnology to give an extra layer of protection from dirt, dust, and stains. For instance, Canadian startup Arylla provides smartphone readable invisible ink in order to make products traceable, where the proprietary ink uses nanotechnology and is completely undetectable by sight and touch. Label suppliers uses the ink to print unique identifiers or tags with Arylla’s low-cost small-footprint inkjet stations, facilitating product authentication, improving product traceability and preventing counterfeiting. Therefore, with several types of nanosensors being used to monitor the freshness and quality of food by detecting any chemical changes, there is a rising demand for industrial packaging solutions that are incorporating the use of nanotechnology, further boosting the growth of global industrial packaging market in the forecasted years.

The COVID-19 Analysis

COVID-19 brought in many changes in the world in terms of reduced productivity, loss of life, business closures, closing down of factories and organizations, and shift to an online mode of work. Lockdown policies, imposed by the government to prevent the spread of virus forced various end user industries to either shut down or run low on production capacity, resulting in lower production of various goods by end user industries and since end user industries including building & construction, oil & lubricants, agriculture etc. demand bulk packaging services and effective industrial packaging solutions for safe transportation of goods, there was a sudden fall in the demand for industrial packaging services as a result of reduced production, impeding the growth of global industrial packaging market during the period, 2019-2020.

Analysis of Key Players

The market for industrial packaging has been fragmented due to presence of numerous international, regional and local vendors. Local manufacturers of industrial packaging products cater to unique and innovative solutions at a lower price as compared to the international vendors, usually resulting in price battles between different players of the market. The key players of the market are Amcor PLC (Bemis Company, Inc.), Mondi PLC, WestRock Company, Packaging Corporation of America (PCA), Sonoco Products Company, Grief, Inc., Berry Global Group, Inc., International Paper Company, Orora Limited (Orora Packaging Solutions), Sealed Air Corporation, Global-Pak, Inc., BAG Corporation, and NEFAB Group AB.