According to PCI Wood Mackenzie's latest review of the European marketplace, 'Flexible Packaging European Supply Demand Report', Poland continued to be the fastest growing major flexible packaging market in Europe in 2017, increasing by over 5% during the year.While overall growth in Western Europe was fractionally down at just below 2% in 2017, demand in Eastern Europe picked up to 3%. Overall, European demand for converted flexible packaging grew by 2.1% in 2017.
According to the report, Europe’s €14.1 billion flexible packaging market remains one of the largest and most sophisticated in the world, accounting for around 17% of the global total in 2017. The region's industry also exports 10% of its production around the world.
PCI Wood Mackenzie Director of Flexible Packaging, Paul Gaster, said: “Relative to other global regions, the European flexible packaging market is mature and slow growing, which will see its share of global demand steadily decline over the coming years. However, the European converting industry will continue to be a world leader in terms of technical innovation and knowhow, and major exporter."
Poland’s flexible packaging industry has achieved success by supporting the high levels of inward direct investment made by multinational food brand owners over the past decade, as well as growing exports of converted materials into Western Europe and elsewhere. Growth in Russia's flexible packaging market, the fifth largest in Europe, picked up to around 3% in 2017, boosted by a rapidly evolving food processing industry, and associated infrastructure, and improving overall economic conditions.
Growth in Turkey, while significantly lower than earlier in the decade, continues at above the overall European trend, boosted by a growing national economy, urbanisation, and relatively rapid population growth. The Turkish industry is a major exporter which is increasingly challenging Italian and other south European suppliers in destination markets.
The European industry remains highly fragmented with more than 700 companies involved in the industry, under PCI Wood Mackenzie’s definition of flexible packaging, with the 26 largest converters accounting for nearly 70% of the total market.
According to the report, with the exception of confectionery and tobacco all end use markets exhibited growth in 2017, with the best performing category being pet food, which increased by around 4% during the year. Sales in sugar and chocolate confectionery applications, which account for 10% of the European market, were broadly static. This reflects struggling end use market sales, especially amongst the major brand owners.
Looking forward, PCI Wood Mackenzie forecasts that European flexible packaging demand will pick up slightly in 2018, subsequently growing by 2.2% p.a. to reach €15.7 billion in 2022.
Source: PCI Wood Mackenzie
