Global Packaging Market for Liquid Products

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Global Packaging Market for Liquid Products

In order to examine the top players in the global liquid packaging industry, each of the 15 largest packaging companies identified by Market Research Reports has been examined below. While most of the companies did not disclose details on what portion of their revenue comes from liquid packaging products, we were able to find some insights into what types of products each company offers. When the revenue breakdown was not found, an attempt to find information on challenges the companies may be facing was also made.

A February 2020 market report published by ReportLinker identified the key players in the global liquid packaging industry as DowDupont, Evergreen Packaging, International Paper, Mondi, Sidel International, Smurfit Kappa Group, Tetra Pak International, and Weyerhaeuser Company. Several of these companies were not included in the list of top global packaging companies, including DowDuPont, Sidel, and Tetra Pak. Following the analysis of the 15 companies identified in the Market Research Reports publication, there is a brief section providing the revenue for these additional companies.

Finally, three trends in the global liquid packaging industry are increased use of spouted pouches, paper straws on packages, and shape designs. These are covered in detail below, along with examples of companies leaning into each trend.

WestRock

  • In 2019, WestRock had total revenue of $18.289 billion. The only breakdown of sales was into corrugated packaging, consumer packaging, and land & development. There was no data in the annual report on liquid packaging.
  • Corrugated packaging accounted for $11.8 billion of revenue in 2019, while consumer packaging accounted for $6.6 billion.
  • On WestRock's website, they break their products down by markets and products. The beverage market would clearly include liquid packaging options, but it is likely there would be liquid packaging options included in other markets as well, such as Beauty and Personal Care, Food Service, Home & Garden, and Retail.
  • Some examples of liquid packaging offered by the company are Liquid Style Multipack Cartons, TruServ™ Compostable Cupstock, rigid tubes, and cans.
  • One challenge mentioned in WestRock's annual report is that they may have issues with retaining Kapstone's customers and suppliers after acquiring the company.

International Paper Company

  • In 2019, International Paper (IP) had total revenue of $22.376 billion. The company broke sales down into the following sectors: Industrial Packaging ($15.236 billion), Global Cellulose Fibers ($2.551 billion), and Printing Papers ($4.291 billion).
  • By highest to lowest volume (in short tons), the industrial packaging segment was broken into corrugated packaging, container board, recycling, EMEA packaging, European coated paperboard, Brazilian packaging, Gypsum/release kraft, saturated kraft, and bleached kraft. There was no breakdown for liquid packaging.
  • A search for liquid packaging on the IP website resulted in 16 results (although some were repeated) including ReadyFill Liquid Bulk Packaging, SpaceKraft Liquid Bulk Packaging, and Bag in a Box Packaging.
  • From March 2018 to March 2019, demand for cardboard boxes fell 3%. This decline can impact IP's business.

Reynolds Group Holdings Limited (RGHL)

  • RGHL reported $9.716 billion in revenue for 2019. According to a March 2020 presentation on the 2019 results, RGHL sold off its North American and Japanese businesses in 2019.
  • The four segments that account for the majority of RGHL's revenue are Reynolds Consumer Products ($3.032 billion), Pactiv Foodservice ($3.717 billion), Evergreen Packaging ($1.606 billion), and Graham Packaging ($1.924 billion).
  • Pactiv offers a wide variety of cup and drinkware packaging.
  • Evergreen's packaging offerings include cartons, spouts & closures, and liquid packaging equipment.
  • Graham Packaging focuses primarily on bottles for liquids, and offers both stock and customized options. Although it was outside the scope of this project to examine all the products in detail, a cursory look indicates that the company offers primarily rigid bottles.

Ball Corporation

  • Ball Corp reported $11.474 billion in revenue for 2019.
  • Beverage packaging in North and Central America represented $4.758 billion in revenue; South American beverage packaging represented $1.670 billion in revenue; and beverage packaging in Europe represented $2.651 billion in revenue. This is a total of $9.079 billion which is 79.1% (9.079/11.474). This means that at least three-quarters of Ball's revenue comes from liquid packaging.
  • The products offered by Ball are made of aluminum and appear to be exclusively rigid.
  • One of the challenges reported by Ball were the prices for aluminum scrap. These rates were unfavorable in the U.S. in 2019 which led to higher expenses for the company.

Smurfit Kappa

  • Smurfit Kappa reported €9.048 billion ($9.858 billion) in revenue for 2019.
  • According to the company's annual report, the main source of packaging revenue is corrugated products, with the remainder coming from bag-in-box and other paper packaging products.
  • Many of their beverage solutions in the U.S. appear to be products to carry multiple cans or bottles, rather than the packaging for the liquid itself.
  • Smurfit Kappa is the European leader in production of bag-in-box, and they have eight facilities that produce bag-in-box packaging. The company also offers a variety of bag-in-box options.
  • Other than general risks as discussed in the annual report, such as those related to the economy, pricing, raw materials, and cybersecurity, there were no specific challenges uncovered for Smurfit Kappa.

Amcor Limited

  • Amcor reported $9.458 billion in revenue for 2019.
  • The company segments their revenue into flexibles ($6.567 billion) and rigid packaging ($2.893 billion). There was no data in the annual report specific to liquid packaging.
  • Amcor offers close to 200 packaging solutions for beverages, as well as many packaging solutions that would work for liquids in the food, healthcare, and personal care categories.

Crown Holdings

  • Crown Holdings reported revenue of $11.151 billion for 2018.
  • Revenue was broken down by both segment and product. By segment, 29% of revenue came from Americas beverage, 13% from European beverage, 18% from European food, 12% from Asia Pacific, 16% from transit packaging and 12% from others.
  • By product, 50% of company revenue comes from beverage cans, while 26% is from food cans & closures, 16% from transit packaging and 8% from others.
  • In the beverage sector, Crown focuses on cans, and does not have any flexible offerings.
  • Crown also offers aerosol cans, which would generally be used to hold liquids.

Mondi Group

DS Smith

  • DS Smith reported revenue of £6.171 billion ($7.619 billion) in 2019.
  • The company segments their business by geographic region which did not provide any data on the size of their liquid packaging business.
  • Rapak is a fully owned subsidiary of DS Smith that produces bag-in-box solutions. They also sell filling machines and urn-liners.
  • Other liquid packaging offered by DS Smith includes the IcePack in Poland, liquid bulk packaging, and packaging for liquid pharmaceuticals. Although we were unable to examine all products offered by DS Smith, a cursory examination of its website seemed to indicate a focus on flexible packaging solutions rather than rigids.
  • Although the chief executive of DS Smith North America remains optimistic, there was reporting that the global trade environment was posting challenges for the company.

Berry Global Group

  • Berry Global reported revenue of $8.878 billion for 2019.
  • In mid-2019 the company reorganized into four main operating segments, consumer packaging international; consumer packaging international; engineered materials; and health, hygiene & specialties. According to descriptions in the annual report the consumer packaging segments appear to be the only ones that would include liquid packaging. Both of these segments include bottles and containers.
  • The international consumer packaging segment had $2.636 billion in revenue in 2019, while the North America segment had $1.229 billion. Since both these segments also include many types of non-liquid packaging, it appears that the liquid segment for the company is significantly less than 50%. A more reasonable estimate could not be made with the publicly available information.
  • Berry does produce both rigid bottles and flexible packaging.

Owens-Illinois (O-I)

  • O-I reported revenue of $6.691 billion for 2019.
  • The company produces glass containers and is in the rigid packaging market.
  • Beverage packaging appears to be the dominant portion of their business, as they produce containers for beer, malt beverages, wine, spirits, soft drinks, teas, and juices. However, they are not exclusively beverage focused, as they also produce containers for pharmaceuticals and food.
  • A further examination of the company website showed that even the food containers offered would be appropriate for liquids. Therefore, although this can't be confirmed with publicly available data, it is likely the company's revenue comes almost entirely from liquid packaging products.

Packaging Corporation of America (PCA)

  • PCA reported revenue of $6.964 billion for 2019.
  • The segments PCA reports on are Packaging, Paper, and Corporate & Other. For purposes of this research, we focused on packaging, as this segment includes packaging for beverages.
  • The packaging segment had $5.9 billion in sales in 2019, which represents 84.7% (5.9/6.964)of the company's total revenue for the year.
  • Based on the product categories highlighted on the PCA website, it does not appear that the company focuses on liquid packaging. The categories are corrugated containers; retail packaging and displays; e-commerce; heavy-duty, produce, stock, hexacomb, falconboard, interior packaging, and containerboard.

Sealed Air Corporation (SAC)

  • SAC reported revenue of $4.7 billion in 2018. There was no data in the annual report specific to liquid packaging.
  • The company reports revenue in two segments, food care and product care. In the food care segment, liquid dairy appears to be the primary product that would fall under liquid packaging. The product care segment does not appear to include liquid packaging, as it is focused on protecting goods being shipped.
  • Liquid pouch packaging is one of ten categories the company highlights under food packaging, and it appears to be the only one relative to liquid packaging.
  • Based on the product offerings on the company website, it appears that they offer flexible liquid packaging, but not rigid.
  • One challenge facing SAC is that it is currently under investigation for alleged insider trading.

Graphic Packaging International, LLC. (GPI)

  • Graphic Packaging reported revenue of $6.160 billion for 2019. There was no data in the annual report specific to liquid packaging.
  • The three segments GPI reports in are Paperboard Mills, Americas Paperboard Packaging, and Europe Paperboard Packaging, The Paperboard Mills segment primarily produces products for internal use by the other two segments, while both paperboard packaging segments mainly produce folding cartons.
  • The Americas Paperboard Packaging segment had 2019 revenue of $4.234 billion, while the Europe segment reported revenue of $689 million.
  • An examination of the corporate website found that the beverage packaging produced by GPI appears to be limited to the multipack carriers and enclosed multipacks that are used to hold multiple bottles or cans, rather than packaging that holds the liquids directly. However, they also produce tuck style cartons for liquids.
  • Overall, it does not appear that the company has a strong focus on packaging for liquids. Their focus appears to be on corrugated products that are flexible, and there was no sign of rigid packaging.
  • The company had plans to expand its operations in Kalamazoo, MI, but it is unclear whether they have begun the project. This could be impacted by the current economic environment.

Stora Enso Oyj

  • Stora Enso reported revenue of €10.055 billion ($10.951 billion) for 2019.
  • By segment, 25% was consumer board, 12% was packaging solutions, 15% was biomaterials, 16% was wood products, 28% was paper, and 4% was others. Consumer board, specifically liquid packaging board (LPB) is used for liquid packaging, The company reports in their annual report that they are the "global leader in liquid packaging."
  • The consumer board division of Stora Enso reported €2.563 billion ($2.792 billion) in revenue for 2019. However, there was no way to determine what portion of this was related to liquid packaging.
  • The company did not provide many details on their website to identify exactly what types of packaging they produce. For beverages, they simply highlighted the benefits of corrugated boxes for beverages. Based on this and other details on the website, it does not appear they produce rigid containers.

Additional Key Players in Liquid Packaging Industry

  • Although it is outside the scope of this research to determine the revenue related to liquid packaging for each of the following companies, we did want to provide overall revenue since each was identified as a key player in the industry of interest.
  • DowDuPont reported revenue of $21.512 billion for 2019. A quick look at the business segments showed it would not be easy to pull the numbers for liquid packaging. The segments are Electronics & Imaging; Nutrition & Biosciences; Transportation & Industrial; Safety & Construction, and Non-Core. This is a link to the company's packaging website.
  • While looking for revenue data for Sidel, it was determined that Sidel and Tetra Pak are both owned by Tetra Laval. Sidel had net sales of €1.4 billion, and Tetra Pak's annual sales were €11.2 billion.


Trends

  • To identify trends in the liquid packaging industry, we examined reports from a variety of expert sources including Packaging Gateway, Plastic Technology, Flexible Packaging, and Future Market Insights. Three trends uncovered are increased use of spouted pouches, paper straws on packages, and shape designs.

Shape Designs and Durability

  • As ecommerce in the food & beverage sector continues to grow, the type of packaging used for products becomes more important.
  • Amazon is the second largest ecommerce company in the world, behind Alibaba, and, because of that, the company's actions can have a huge impact on how businesses operate. Amazon implemented a drop test for liquids, and requires all liquid products to survive five separate drops onto a hard surface from a height of three feet. Anyone who wants to sell on Amazon must ensure their packaging meets the requirements.
  • There are many reasons companies may want to use innovative shapes for their liquids, including reducing space, saving money, and standing out. Tetra Pak introduced a cube packaging system which allows every six packages to form a cube.
  • Cheer Pack introduced CHEERShapes, which are pouches that can be designed with unique shapes. This may be a shape that is used on all products to make the products easily identifiable on the store shelves, or a specific shape to reflect what is in the package, such as a pear shape. The company also offers cube pouches for easier packing and transport.

Paper Straws

  • With a push to reduce the use of plastic straws well under way, it is not surprising that this is also impacting liquid packaging that utilizes straws. In 2019, several large brands made the switch to paper straws, including Huhtamaki, World Centric, and Ben & Jerry's.
  • In 2019, Tetra Pak became the first company that manufactures carton packaging to make the move to paper straws in Europe. These are the straws that come attached to their beverage products that are typically used for dairy and beverage products for kids. Rather than patent the technology they used to produce the straws, they made it available in the public domain.
  • In early 2019, SIG announced a partnership with Nestle to use paper straws for on-the-go portion packs. The first launch was in the Dominican Republic.
  • There is room for plenty of innovation in the space as companies look for biodegradable options and find ways to reduce litter by having the straw wrapper remain attached to the carton.

Spouted Pouches

  • According to a report by Global Market Insights, the size of the liquid pouch packaging market was expected to almost double, from $5.5 billion to $10.5 billion, from 2017 to 2024. This represents an annual growth rate of about 7.5%. The fastest growing segment is spouted pouches.
  • Flexible packaging in general is replacing rigid packaging as it has many benefits over solid packaging. These include recyclability, convenience, and less risk of tampering. Additionally, a single truckload of flexible packaging is the equivalent of 26 truckloads of glass containers, according to the Flexible Packaging Association.
  • As spouted pouches become more widespread, standardization can provide further benefits. If standard sizes and shapes are agreed on industry-wide, this can reduce the number of equipment changes needed on an assembly line, reduce manufacturer costs as they can use standard sizes across many applications and receive quantity discounts, and reduce the type and number of labels and closure accessories needed.
  • Manufacturers who offer spouted pouches include Ted Packaging, Glenroy, and Bemis.
  • Other manufacturers are innovating in the space to help them stand out. For example, ProAmpac designed a spouted pouch for a Redken product that allowed the company to go from three containers to one; and ePac Flexible Packaging was able to create unique pouch designs that were produced in limited quantities to highlight the Tour de France. Gerber recently introduced the first pouch made entirely from a single material, which means it can be recycled more easily.
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