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PPC's annual Trends Report forecasts gradual growth for carton industry

The Paperboard Packaging Council (PPC, recently released its annual Trends: 2012 Industry Outlook and Market Data Report, the definitive analysis of what lies ahead for the paperboard packaging industry. An invaluable tool for translating market challenges into opportunities, the report reflects the partnership of PPC and RISI, the leading provider of paperboard packaging industry market forecasts and analysis. The report identifies growth markets and analyzes trends for 17 key market segments of the paperboard packaging industry, which include food products (beverages, cereals/milled grains, confectionery, dairy, dry foods, frozen foods, meat, perishable bakery goods and retail carry-out foods) as well as non-food products (cosmetics, hardware and household supplies, converted paper products, pharmaceuticals, recreational products, soap and detergent, tobacco and miscellaneous end-use markets).

In this year’s report, three end-use categories were classified as growth markets (those that can expect tonnage shipments to grow by 1.0% per year or more over the next five years), four as mature (with 0–0.9% growth rates), and  10 that are expected to record a downward trend in shipments over the next five years.

“This report provides converters with valuable insight on what to expect over the next five years and how to best prepare for changing economic and market trends,” says Ben Markens, president of PPC.  

According to the report, although the recession is over, consumers are still struggling financially. As is the folding carton industry, whose shipments fell 4% in 2010-11. Folding carton shipments lagged about 2% behind overall growth in consumer spending on nondurable goods over the last decade. Shipments continued to slide in 2011, declining 3.3% for the year. Although total growth over the next five years is expected to average just 0.5% annually, carton shipments should rebound 1.8% in 2012.

Other interesting trends that were identified include the following:
  • Growing concern over consumer health and safety means an increased use of tissues packaged in paperboard.

  • As the newest trend in the tobacco industry, e-cigarettes deserve the attention of packaging manufacturers.

  • As men are becoming more devoted users of cosmetics and toiletries, there is enormous opportunity for clever packaging in this sector, such as rigid cigar boxes and rugged-looking secondary packaging.

  • Even though the U.S. is expected to produce more milk this year than it has in many years, aseptic milk packagers are struggling, as PET containers-and now stand-up flexible pouches-eat into their market share.

  • The number of Americans 65 and older is poised to double in the U.S. between 2000 and 2030. While this older Baby Boomer demographic will require medication to stay healthy and active, their specific product needs are also crucial. Think easy to open, easy to read and easy to differentiate from other medications.

  • The U.S. gum market is expected to reach $23.1 billion by 2017, fueled, in part, by the new trend in medicated gum that treats ailments like ulcers, cavities, and ear infections. This is good news for the industry, as many gum manufacturers have recently switched over to paperboard for their packaging.

  • Due to the explosion in single-serve brewing systems, in 2010, ready-to-drink tea increased a remarkable 12.5% in volume (and 4.8% in 2011) and revenue has been rising steadily since 2005. This kind of growth should inspire converters to market a new paperboard K-Cup.

  • Frozen dinners, which are often packaged in paperboard, have recently been left in the supermarket freezer in favor of a night out or a more expensive cooked meal at home. Increased emphasis on luxury and gourmet aspects of these products could command more attention from consumers.

  • Because of heightened awareness of harmful chemicals in household products, expect better regulation and more explicit toxic warning labels on household chemical packaging.

  • Comprehensive cosmetic kits, which are often packaged in paperboard, continue to increase in popularity, as consumers seek both value and a complete enhancement experience.

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