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Indonesia Plastic Packaging Market - Growth, Trends, COVID-19 Impact, and Forecasts (2023-2028)

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  • 102 Pages
  • April 2023
  • Region: Indonesia
  • Mordor Intelligence
  • ID: 5459097
The Indonesian plastic packaging market is expected to register a CAGR of 2.5% over the forecast period. Owing to the COVID-19 pandemic, food and beverage companies are developing response actions and effective plans to help mitigate their risk and prepare for how they would deal with the effects of the coronavirus. These plans include establishing an interdisciplinary crisis response team of personnel from all aspects of the business to identify, assess, and manage the risk presented.

Key Highlights

  • The increasing technological advancements and end-user industry packaging applications are the significant factors driving the growth of the market studied. In most of Indonesia, the population is growing, and the use of packaging per person is increasing. It is also growing due to consumer behavior trends, such as the growth in the use of convenience products and the increasing use of plastic as a substitute for other packaging materials.
  • Plastic packaging has implemented new ways for the functioning of the packaging industry. Packaging solutions that are durable, lightweight, and comfortable have augmented the use of plastics as a packaging material across the region.
  • The price of LDPE packaging is currently low in the region, which means that there will be minimal impact on the sellers from the additional cost of using the material. The demand for surgical masks, which are made of materials such as polypropylene, polyisoprene, and polyurethane, has also increased.
  • Plastic pollution has become a global problem. Several types of research have stated plastic's adverse effects on the environment. Owing to this, Indonesia also implemented regulations to reduce the use of plastics. The Indonesian plastic packaging market is facing serious concerns due to the plastic resin price rise. This is leading to increased lags in recovering higher costs of resin and reduced profitability among established local players.
  • Additionally, to fund a response to the COVID-19 pandemic, the Indonesian government introduced a fiscal stimulus package worth trillions of rupiah and increased its state budget deficit above the 3% legal limit. The country's current flexible packaging market players are anticipated to benefit from this. However, breaking even for newcomers may provide unheard-of difficulties. There is also the impact of the Russia-Ukraine war on the overall packaging ecosystem.

Indonesia Plastic Packaging Market Trends

Skincare Segment is Observing Significant Growth

  • Skincare packaging uses a variety of plastic cosmetic jars to suit various packaging needs. The need for packaging for skincare products is on the rise in Indonesia. Various skincare brands in the region are facing increased competition, and packaging suppliers are offering various brands to differentiate designs with ease of use, convenience, and advanced capabilities.
  • Plastic is a prominent material in skincare packaging due to its low cost, lightweight, flexibility, durability, and other factors. Additionally, it is odorless and offers a pleasant appearance. For personal care products, plastics are a material of choice for manufacturing shatterproof and 'no-spill' bottles, jars, tubes, caps, and closures.​
  • Newer filling technologies and the development of heat-resistant PET bottles opened up new possibilities and options in the market. While PET bottles are common in multiple segments, beverages, sanitary products, cosmetics, and detergents are predominantly sold in bottles that are made up of polyethylene (PE).
  • Supermarkets had been the primary distribution method for the Indonesian cosmetic sector before the COVID-19 pandemic in 2020. However, the pandemic has caused the distribution of cosmetics to move from brick-and-mortar businesses to online marketplaces. Given that customers appear to prefer the ease of having goods brought to their front door via delivery services like Gojek Instant Service, this trend is predicted to continue.
  • Some brands are choosing to reduce their consumption of single-use plastic by using post-consumer recycled PET, following the suit of other industries. Aveda, for instance, is now using 100% post-consumer recycled PET in 85% of its skin care and hair styling PET bottles and jars, as well as using bioplastic from sugarcane.

Increase in Adoption of Lightweight Packaging

  • The lightweight property of the material has been driving the growth of plastic in Indonesia. Glass is much heavier than plastic, which means more trips are required while transporting. This translates to a more significant environmental impact. Glass is also much heavier for the end consumer, whereas plastic is lightweight and easier to carry.
  • The demand for aluminum beverage cans is also significant. The average weight of an empty aluminum can is 14.9 grams. Though these materials are light in weight, the probability of beverage cans being damaged during transportation is high compared to plastic bottles. Therefore, the lightweight property of plastic has driven its adoption in the manufacturing of bottles and containers.
  • Moreover, out of all the types of plastic, it is anticipated that using PET will help in manufacturing the lightest bottle and containers. According to PETRA, PET is a clear, strong, and lightweight plastic that is widely used for packaging food and beverages, especially convenience-sized soft drinks, juices, and water.
  • Oji Holdings Corporation and PT Purinusa Ekapersada, an Asia Pulp & Paper company, decided to form a USD 35 million joint venture to build a new converting factory in Indonesia. The new company, PT Oji Sinar Mas Packaging, would manufacture corrugated cardboard and containers to suit Indonesia's expanding domestic demand.

Indonesia Plastic Packaging Market Competitor Analysis

As the demand for plastic packaging has been increasing significantly in the Indonesian region, the market is mildly concentrated with the presence of major players like Amcor, Coveris Holding, Berry Global, Sealed Air Corporation, and Constantia Flexibles, among others.
  • September 2022: Toyobo Co. Ltd, a Japanese fiber and textile manufacturer, stated that it would establish a second facility in Indonesia to produce polyester films for packaging at Pt. Trias Toyobo Astria. Toyobo and the well-known Indonesian film producer Pt. Trias Sentosa formed TTA as a joint venture company to meet the growing demand for environmentally friendly film goods. A JPY 10 billion (~USD 73.97 million) investment would be made to quadruple TTA's production capacity. Toyobo intends to begin building the plant in the spring of 2024 and have it operational by the end of 2025.

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  • The market estimate (ME) sheet in Excel format
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Table of Contents

1.1 Study Assumptions and Market Definition
1.2 Scope of the Study
4.1 Market Overview
4.2 Industry Value Chain Analysis
4.3 Industry Attractiveness - Porter's Five Forces Analysis
4.3.1 Bargaining Power of Suppliers
4.3.2 Bargaining Power of Consumers
4.3.3 Threat of New Entrants
4.3.4 Threat of Substitute Products
4.3.5 Intensity of Competitive Rivalry
4.4 Impact of COVID-19 on the Market
4.5 Overview of the Global Plastic Packaging Market
4.6 Market Drivers
4.6.1 Increasing Adoption of Lightweight Packaging Methods
4.6.2 Increased Eco-friendly Packaging and Recycled Plastic
4.7 Market Challenges
4.7.1 High Price of Raw Material (Plastic Resin)
4.7.2 Government Regulations and Environmental Concerns
5.1 By Packaging Type
5.1.1 Flexible Plastic Packaging
5.1.2 Rigid Plastic Packaging
5.2 By Product Type
5.2.1 Bottles and Jars
5.2.2 Trays and Containers
5.2.3 Pouches and Bags
5.2.4 Films and Wraps
5.2.5 Other Product Types
5.3 By End-user Vertical
5.3.1 Food
5.3.2 Beverage
5.3.3 Healthcare
5.3.4 Personalcare and Household
5.3.5 Other End-user Verticals
6.1 Company Profiles
6.1.1 Amcor PLC
6.1.2 Coveris Holding
6.1.3 Berry Global Inc.
6.1.4 Constantia Flexibles Group
6.1.5 Wipak Ltd
6.1.6 Sonoco Products Company
6.1.7 Sealed Air Corporation
6.1.8 National Flexible Ltd
6.1.9 Tetra Laval Group
6.1.10 Silgan Holdings

Companies Mentioned (Partial List)

A selection of companies mentioned in this report includes, but is not limited to:

  • Amcor PLC
  • Coveris Holding
  • Berry Global Inc.
  • Constantia Flexibles Group
  • Wipak Ltd
  • Sonoco Products Company
  • Sealed Air Corporation
  • National Flexible Ltd
  • Tetra Laval Group
  • Silgan Holdings