Asia-Pacific region to account for almost two thirds of demand for folding cartons by 2018

New data released by Asia Pulp & Paper Group (APP) identifies the Asian market as critical for the growth of the cartonboard industry, driving demand for both folding cartons (e.g. folding boxboard) and liquid cartons (e.g. milk cartons).

According to the findings from the report, “Paper based packaging trends to 2019”, the Asia-Pacific region will increase its share of global volume demand for folding cartons from 56% in 2013 to more than 63% in 2018. The prominence of the region will also be compounded by a wider global increase in consumption of folding cartons from 47 million tonnes in 2013 to 63 million tonnes in 2018.

Asian growth is expected to significantly surpass the global average in a number of sectors. Asia will outpace the worldwide increase in the confectionary sector by 41%, the preserved foods sector by 29% and the soft drinks sector by 35%.

This is forecast to be largely at the expense of developed markets, with the EMEA share of demand falling from 25% to 21% and the Americas declining from 19% to 16% across 2013 to 2018.

The report identifies a number of drivers of demand in Asia which account for the growing importance of the region for the cartonboard industry:

• Diversification of consumption patterns – Increasing numbers of western and international products are being consumed by Chinese and other Asian consumers as they travel more and experience western food and other products, driving cartonboard consumption growth.

• Shift from informal to formal markets - The shift from ‘informal’ ‘unpackaged’ to ‘formal’ ‘industrially packaged’ consumption will drive long-term growth in liquid cartonboard and folding carton demand across food and beverage areas. For example, currently the majority of the milk market in India (world’s largest milk market) is mainly unpackaged, and a growing shift to packaged consumption is having a major impact on liquid cartonboard material demand.

• Single-serve packs – An increasing number of single-person households coupled with a growing demand for convenience, has driven demand for smaller packs, which involve more packaging than the larger packs they replace. The single-slice pizza box has become increasingly popular in Asia and particularly in major cities such as Shanghai.

Lee Henderson, Director of European Sustainability and Stakeholder Outreach at Asia Pulp and Paper, said:

“We are seeing a global shift in cartonboard demand, which will have implications across the industry. The prominence of the Asian region will re-focus international supply chains, and manufacturers will need to respond quickly to capitalise on the emerging markets. The middle classes in Asia are increasingly becoming a global force and, if manufacturers hope to be internationally competitive in five years’ time, then they will need to ensure that they are positioned to serve the Asian markets.”

Dr Graham Moore, Strategic Consultant, Smithers Pira, said:

“With cartonboard use covering a wide range of end use applications, its overall demand is linked with prevailing economic conditions. In the developed economies, cartonboard demand has been flat, but the slowly improving economy should lead to better local demand and a growing export market in the near future. In contrast, in the developing economies of Asia, the rise in overall incomes and expanding middle classes is resulting in a surging demand for a range of products packaged in cartonboard. Such demand will continue to stimulate increased consumption of the grade.”

About the research

Established in 1930, Smithers Pira is the worldwide authority on the Packaging, Print and Paper supply chains. This White Paper was put together based on extensive desk and primary research, and written up by consultants with in-depth knowledge of the paperboard and packaging industries. Interviews were conducted across the value chain to supplement existing data held on the markets and technologies in these core industries. Smithers Pira tracks the market and publishes more than 25 market reports and multi-client studies every year. The forecasts were compiled using robust methodologies that have been developed over many decades, and are used and trusted by Smithers Pira’s core customer base of raw material suppliers, machinery suppliers, printers, packaging converters, brand owners and other end-users.

About Asia Pulp & Paper

Asia Pulp & Paper Group (APP) is a trade name for a group of pulp and paper manufacturing companies in Indonesia and China. APP is responsible for delivering quality products to meet the growing global demand for tissue, packaging and paper. On any given day, our products find their way into the hands of consumers in various branded forms from all over the world.

Started in 1972 with Tjiwi Kimia producing caustic soda, now we run operations across Indonesia and China with an annual combined pulp, paper, packaging product and converting capacity of over 19 million tons per annum. Today, APP markets its products in more than 120 countries across six continents.

Over the years, we have expanded our operations significantly through the acquisition and expansion of several of our pulp and paper mills. It’s our commitment to customer satisfaction that enables us to grow our share in paper sales worldwide and broaden our presence through offices in many countries. We believe ‘tradition and modernity go hand in hand’ which means we value long term relationships as part of our Eastern traditions, while we also are eager to embrace the modern values of innovation and efficiency.

Maintaining the integrity of our supply chain is also crucial to APP’s operations as well as our commitment to our Sustainability Roadmap Vision 2020. Learn more about APP’s path to operational excellence by reading our Sustainability Reports and Forest Conservation Policy.