Processing Magazine

Foodservice packaging industry upbeat for 2013

April 22, 2013
food packaging industry
Almost 85 percent of foodservice packaging manufacturers in North America believed that they were going to increase their sales volumes in 2013.

The U.S. Foodservice Packaging Institute (FPI) has predicted that the North American and European foodservice packaging industries are likely to grow in 2013, with the recovering economy and more stable input pricing the most powerful drivers for growth.

The FPI's State of the Industry Survey found that the outlook for the year was positive, despite recent drawbacks, such as the proposed polystyrene ban in New York City. Almost 85 percent of foodservice packaging manufacturers in North America believed that they were going to increase their sales volumes in 2013, and three-quarters expected to improve on their net profit, compared to last year's figures. Meanwhile, their counterparts across the Atlantic were a little less optimistic. Just over half of European foodservice packaging businesses predicted a rise in sales volumes, while one in three anticipated an increase in profit, compared to 2012.

The report stated that all North American raw materials suppliers reported sales volume growth but this strong performance was unlikely to be reflected in net profit this year, as only about 50 percent of them predicted a profit increase. Machinery suppliers have similar expectations, with positive development predicted by two-thirds and a third of respondents respectively, the FPI found. Their expectations were fueled by the fact that over 70 percent of manufacturers in both North America and Europe intend to buy new machinery rather than used equipment this year in a bid to achieve an increase in market share and product capability expansion.

In an interview with Plastics Today, FPI president Lynn Dyer commented that there were several specific indicators in the report that highlighted the industry optimism for 2013. This suggested that, while the industry may not be immune to recession, it certainly proved to be recession resilient, she said.

RELATED: BPA fears may affect metal packaging industry growth

When asked which segments of business they expected to drive growth over the next five years, respondents cited single-use packaging from grocery stores and quick service restaurant chains, as well as convenience stores for North American manufacturers in particular. Other foodservice market segments that were predicted to fare well included grocery stores and fast casual restaurants, the report noted.

However, the industry also expected challenges to deal with. Surprisingly, the global economic recession or recovery was not mentioned among the potential barriers to growth for the first time in a few years. Overall, the industry was convinced that, as long as restaurants and other eating and drinking establishments were doing well, the foodservice packaging industry would be growing, the FPI revealed. Even though the economy has still not recovered to pre-recession levels, people still have to eat and businesses in the foodservice packaging industry have a competitive advantage compared to other end-markets.

As far as material trends go, the report highlighted the increased usage of PET and PP, as well as in bio-based PLA and recycled content in foodservice packaging. According to Dyer, these developments were driven by a combination of packaging innovation and demand.