Packaging Resins Market Size Forecast to Reach $310.1 Billion by 2026

Packaging Resins Market Size Forecast to Reach $310.1 Billion by 2026

“Packaging Resins Market”
Increased Demand for Packaged and Ready-to-eat Food Is Also Contributing to the Growth of Packaging Resins Market

Packaging Resins Market size is forecast to reach $310.1 billion by 2026, after growing at a CAGR of 7.3% during 2021-2026. Packaging resins are plastic resins like Low Density Polyethylene, Polyvinylchloride, Thermoplastic polymer, and Polyethylene terephthalate that possesses suitable characteristics for various packaging solutions. These are low-cost lightweight materials with exceptional flexibility and durability. Increasing preference from consumers for convenient packaging is driving the market growth. Moreover, increased demand for packaged and ready-to-eat food is also contributing to the market growth. Furthermore, cost-effectiveness and the resulting improved shelf-life of the product are also driving the growth of the Packaging Resin market.

Emergence of Covid-19

The COVID-19 pandemic continues to unfold every day with a severe impact on people, communities, and businesses. The growing pandemic situation has led to the weakening demand for Packaging Resins like Low-Density Polyethylene, Polyvinyl chloride, Thermoplastic polymer, and Polyethylene terephthalate. The pandemic has created a sense of fear for packaged food, due to fear of transmission. As well as due to increase in unemployment level and salary cut due to the pandemic, have reduced consumer spending, which is significantly deterring the Markets growth.

Packaging Resins Market Segment Analysis – By Resin Type

Polyethylene (PE) segment is projected to witness the highest CAGR of 9.2% in the Packaging Resins Market during the forecast period. Polyethylene like Low Density Polyethylene, HDPE, and LLDPE are extremely flexible and resistant to steam, moisture, and scratches, making it a very common material for various packaging applications. PE plastic material provides many advantages for packaging, including excellent durability and toughness. Whereas, HPDE, LLDPE, and LDPE, provide excellent product presentations hence they are frequently used to create cleaning bags, food packaging, and shrink wrap. Furthermore, due to toughness and flexibility, PE-based packing is the ideal choice for heat sealing applications and also offers resistance to acids, bases, and many oils.

Packaging Resins Market Segment Analysis – By Material

Barrier Resin segment is projected to grow with a significant CAGR of 6.3% in the Packaging Resins Market during the forecast period. Barrier resin is a monolayer oxygen ingress resin used for packaging applications across various end-use industries like food and beverage and personal care. The barriers-based packaging products offer various benefits like prevent of any kind of liquid penetration, oxygen, nitrogen, carbon dioxide, and vapor or moisture and provides longer shelf life protection. Containers made from barrier resin are crystal clear and protect oxygen-sensitive foods and beverages such as juice, wine, dairy, fortified water, and other condiments throughout their entire shelf life. Furthermore, increasing consumer spending on cosmetic products including skincare, haircare, and makeup products also increases the demand for barrier resins like Low-Density Polyethylene, Polyvinyl chloride, Thermoplastic polymer, and Polyethylene terephthalate. For instance, as per Cosmetic China Agency, the cosmetic market is projected to generate a sale of $60 billion by 2024.

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Packaging Resins Market Segment Analysis – By Packaging Types

The Rigid Packaging segments held the largest share of more than 45% in the Packaging Resin Market in 2020. Rigid packaging is the type of packaging which do not bend, thus protecting the products from external damage. They offer various benefits like excellent strength and durability, better protection for the product inside, sealing properties, resistance to grease, abrasion and heat are essential and cost competitiveness and efficiency. Rigid packaging can be molded into an unlimited number of unique shapes and sizes, whether small yogurt cups or large like a salad container. The properties and their benefits make rigid packaging based on Low Density Polyethylene, Polyvinyl chloride, Thermoplastic polymer, and Polyethylene terephthalate to be more dominant in the packaging resin market than flexible packaging. Whereas, the surging uses of rigid plastic in the packaging of household, pharmaceutical, and personal care products further drive the market growth.

Packaging Resins Market Segment Analysis – By Application

Food Packaging segment held the largest share of more than 40% in the Packaging Resins Market in 2020. Packaging resin is an important element used in manufacturing food packaging products that prevent any sort of food wastage due to adulteration by acting as a barrier between the food and the contaminants like microbial and chemical. Packaging provides excellent durability and flexibility to food and beverage products. Food Packaging serves many purposes like protecting the food from contamination, creating portion sizes, and offering information about the product. Whereas, changing lifestyle, ready-to-eat, and food preferences of consumers along with the growing population in the developing nations is driving the growth of food packaging. 

Packaging Resins Market Segment Analysis – By End-Use Industry

Food & Beverages segment held the largest share of more than 35% in Packaging Resins Market in 2020. The focus of the food & beverage industry is to increase the shelf life of the product. Food and beverages packaging provides the product from tampering resistance and further aids food nutrition, rapid and reliable distribution of food among the value chain. An increase in population, an increasing trend for health & wellness, and a rise in consumer income are boosting the demand for the food & beverage industry. Packaging resin in the food & beverage industry not only protects the goods but also help to present the product to the consumer, with design flexibility. Furthermore, rapid economic growth and the large size of the middle class in China and India have led to a wide customer base for food & beverages, and hence fueling the demand for packaging resin in this industry.

Packaging Resins Market Segment Analysis – By Geography

Asia-Pacific segment held the largest share of more than 45% in 2020 and is projected to witness the highest CAGR of 9.7% in the Packaging Resins Market during the forecast period. This growth is attributed to the growing population, increase in consumer income, and entry of online food delivery business. Packaging resins have excellent resistance to bases, vegetable oils, are transparent, provide a barrier to oxygen, water, and carbon dioxide and prevent bacterial microleakage. Due to these properties, the food is protected from contamination and also provides flexible packaging. The growing demand for FMCG products is also contributing to the growth of the market. As per the Indian Brand Equity Foundation (IBEF) report in 2020, the retail market in India is estimated to reach US$ 1.1 trillion by 2020 from US$ 840 billion in 2017, with modern trade expected to grow at 20-25% per annum. So further increase in the FMCG market will boost the Packaging Resin Market.

Packaging Resins Market Drivers

High Demand from Pharmaceutical Industry

The growing demand for packaging resin based on Low Density Polyethylene, Polyvinyl chloride, Thermoplastic polymer, and Polyethylene terephthalate from the Pharma industry are driving the growth of the market. Due to increased demand for medication, and an increase in infectious, chronic, and deficiency diseases the demand for medical packaging has increased. These resins are used for manufacturing medication packaging like medicine vials, ampoules, blister packs, syringes, labels, accessories, inhalers, vials, pouches for drugs, medical products, and others. Whereas, the Polyvinyl Chloride (PVC) and Polyvinyl Dine Chloride (PVDC) are majorly used for pharmaceutical packaging materials. The resins protect the pharmaceutical products against oxygen and odor, moisture, water vapor transmission, contamination, and bacteria. Therefore, any growth in the pharmaceutical industry will further boost the demand for packaging resin. For instance, as per the Indian Brand Equity Foundation, the pharmaceutical industry in India is projected to reach $100 billion by 2025. Furthermore, according to Packaging Europe, a private company report in 2019, pharmaceutical packaging is expected to reach $128 billion by 2025, which will propel the demand for plastic films & sheets during the forecasted period.

Rapid Urbanization is Fueling the Market Growth

According to the United Nations (UN) report, around 55% of the global population resides in urban areas and is expected to increase to 68% by 2050. The growth in urban population creates demand for FMCG products, the food & beverages industry, and the e-commerce business, which in turn drives the demand for packaging resins. As packaging resins are used to manufacture packaging bags, films, containers, bottles, packaging tapes, bubble wrap, and others. They protect their products, from moisture, contamination, spillover, and prevent goods damages during delivery. According to Indian Brand Equity Foundation (IBEF) in 2020, India is the fastest-growing e-commerce market and is expected to grow at 1200% by 2026 and is expected to reach $84 billion by 2021. Furthermore, in a report released by Food Drinks Europe in 2019, a food industry confederation, the food & drink industry revenue was € 1,192 billion (around $ 1,413 billion) in 2018. Therefore, the growth in these industries will further boost the demand for packaging resin products based on Low-Density Polyethylene, Polyvinyl chloride, Thermoplastic polymer, and Polyethylene terephthalate.

Packaging Resins Market Challenges

Cost Fluctuation and Environmental Issue

Volatile prices of polypropylene and Polyethylene which are procured from crude oil and biomass further act as a challenging factor to the market growth. As any fluctuation in the price of these raw materials deters the market growth. For instance, the fluctuation in prices of crude oil from mid-2015 to 2020, is considered as one of the challenging factors to the market growth. Furthermore, growing environmental concerns and public awareness regarding the harmful effect of plastic on health as well as the environment further acts as a restraining factor to the market growth. Additionally, the ban on the use of single-use plastic worldwide is also deterring the market’s growth.

Packaging Resins Market Landscape

Technology launches, acquisitions, and R&D activities are key strategies adopted by players in the Packaging Resin Market report. Major players in the Packaging Resins Market are Arkema Group, Borealis AG, Braskem, Sinopec Corp., ExxonMobil Corp., DAK Americas, Far Eastern New Century Corp., Ineos Group AG, Styrolution Group GmbH, Dow DuPont Inc., and others.

Acquisitions/Technology Launches

In June 2019, Far Eastern New Century Corp., one of the leading textile suppliers in Taiwan, acquired Phoenix Technologies, a recycled polyethylene terephthalate (PET) firm in the United States. With this acquisition, Far Eastern New Century was entered into the market of polyester development along with having access to the United States market to sell its product, which will further contribute to the markets growth.

In January 2019, DAK Americas LLC, Charlotte, North Carolina, signed an asset the purchase agreement with Perpetual Recycling Solutions LLC to acquire the Perpetual polyethylene terephthalate (PET) recycling facility in Richmond, Indiana. The acquisition of Perpetual and additional rPET capacity enhanced the DAK products offering to meet growing consumer demand for Perpetual Polyethylene Terephthalate (PET), which will further boost the growth of the market.

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