MEXICO CITY (Nov. 29, 12:30 p.m. ET) — Brazil's hosting of the Fifa World Cup soccer tournament in 2014 and the summer Olympic Games in 2016 will help drive growth in the country's flexible packaging market in the next five years, according to a new study.
The Central and South American Flexible Packaging Market to 2015 describes the Brazilian food industry as “modern” in relation to international standards, with 40 percent of the food bought by the population of 200 million sold through supermarkets.
“That demand will only increase in the run up to global, high profile events, such as the 2014 Fifa World Cup and the 2016 Olympic Games,” the report by British company PCI Films Consulting Ltd, says.
Since 2005, the flexible packaging market in Central and South America has grown 5.3 percent a year on average to $4.3 billion, driven by growing economies and a burgeoning middle class, a phenomenon that has led to improved supply chain structures and food processing, it states.
PCI Films expects flexible packaging output by regional converters to increase by 4.6 percent a year on average and to reach $5.34 billion by 2015.
Demographic growth and increasing numbers of single person households, working women and young consumers will also contribute towards a spike in sector sales, it says.
“Brazil alone accounts for around 48 percent of regional flexible packaging demand. If you add in Colombia and Argentina, that figure goes up to two-thirds (67 percent).”
According to PCI consultant Paul Gaster, the Central and South American flexible packaging market is now so well served by local production that any multinational converter planning to grow its business in the region would “do well to consider forging alliances with or acquiring local converters.”
Most of the flexible packaging demand is satisfied by internal producers, with only 1 percent imported and 2 percent exported outside the region, according to PCI.
However, some raw materials, notably PET film, are still imported from China and India. The report claims that “substantial” BOPP and PE film production takes place, although there is only one regional PET film producer.
“As the flexible packaging market has continued to develop, demand for higher barrier, higher specification packaging has increased and local converters have made investments to substitute the volumes previously imported.”
“There are prospects for further consolidation among producers, while environmental considerations will tend to benefit flexible packaging as pressure is applied to manufacturers to reduce packaging volumes and post-packaging waste,” it adds.
A spokesman for PCI Films, of Guilsborough, Northamptonshire, said Mexico is not included in the study. “It will however be featured in the forthcoming North American report, due to be published next month.”
The Central and South American Flexible Packaging Market to 2015 is available from PCI Films Consulting www.pcifilms.com. It costs 3,500 euros.