Its report, 'The Future of Liquid Paperboard to 2022', claims demand for LPB will accelerate significantly at 4.5% per year, driving a total market value of $4.69bn in 2017 to reach $5.83bn in 2022.
It found more than 70% of LPB consumption occurred in the dairy industry last year, with juice packaging accounting for a further 20% plus.
“Consumption of dairy products has slowed in Western Europe but Eastern Europe has enjoyed rapid growth in demand, sustaining volume demand for liquid paperboard. Globally, however, the industry is seeing growing competition from ‘alt-milk’ products, such as nut-based ‘milks’,” said Stephen Harrod, report author, Smithers Pira.
“However, these products may actually stimulate demand for LPB, as they open up new niche markets.
“LPB consumption will be maintained over the medium term, assisted by the healthy eating trend, together with growing consumption patterns in the emerging markets.”
The report states production of LPB and food/cupstock (FCS) boards combined passed the 7m tonne mark in 2015. This has grown by over 3% annually on average since 2012. Reaching 7.2m tonnes in 2016, this segment of the packaging market was worth $9.5bn to the paper mills.
Production of the material is highly concentrated and is produced in only 10 countries around the world.
Americas and Europe
Consumption of converted board products is spread globally but in contrast to some other packaging segments, three-quarters of all converted LPB is still used in the Americas and Europe, with Asia holding a moderate 17% market share in 2016.
Top 10 LPB producing countries
Canada, Russia, US, Sweden, Switzerland, Brazil, China, India, Japan, Other Asia.
Source: Smithers Pira
“In spite of increasing competition from other alternative beverages, including ready-to-drink (RTD) tea and coffee, energy drinks and the like – especially amongst younger consumers – demand for LPB in the dairy industry will see continued good growth, with nearly 400,000 tonnes of additional LPB materials needed to meet demand growth between 2017 and 2022,” added Harrod.
An overall trend across the packaging industry is to minimize the environmental impact of packaging, which has led to technical innovations and new business models across the value chain.
This interest includes consumers, brand owners, converters and regulators and spans a number of different means to realize the goal of furthering the use of sustainable, recyclable and compostable packaging into the mainstream.
Marketing to more environmentally-aware consumers will increasingly be an important differentiator for packaging suppliers and FMCG brand owners in the future.
This is driving the development of more sustainable LBP products such as Tetra Pak’s Tetra Rex Bio-based, Tetra Brik Aseptic 1000 Edge with Bio-based LightCap 30, and the Tetra Top carton bottle, as well as the Combidome low-acid carton bottle from SIG Combibloc and Elopak’s Pure-Pak Sense Aseptic carton.
The report tracks how evolution in the core segments and new evolving end-use applications will impact the market across the next five years.