Market Challenges And Opportunities
Retort Packaging Market Drivers:
- Surging demand for packaged and ready-to-eat foods: The demand for packaged and ready-to-eat foods is increasing rapidly worldwide, driven by busy lifestyles, a rising middle-class population, and evolving food habits. Consumers are seeking convenient, healthy, and safe food products that can be consumed on-the-go. Retort pouches, trays, and cartons offer efficient sterilization and extended shelf life for such foods without requiring refrigeration. Key food categories driving retort packaging include meat snacks, ready meals, pet food, baby food, soups, and sauces. Retort packaging ensures product safety and quality during distribution while providing convenience to consumers. For instance, as per data by the Food and Agriculture Organization, between 2018 and 2020, the production of prepared snacks such as potato chips and extruded snacks went up by over 13% globally.
- Growth of online food delivery services: The rapid growth of online food delivery services such as foodtech and e-commerce is boosting the demand for retort packaging. To enable delivery of hot and chilled foods while maintaining quality and safety, sturdy and high-barrier retort packaging solutions are ideal. Retort pouches with insulation properties are gaining popularity. Online delivery services rely on the long shelf life offered by retort packaged foods. The rise in nuclear families, urbanization, and tech-savvy millennials depending on online food delivery will continue to drive retort packaging demand.
- Sustainability and innovation driving new product developments: Sustainability is a key priority in the packaging industry. Retort packaging manufacturers are focusing on innovative solutions that enhance recyclability, use renewable materials, and reduce carbon footprints. For instance, mono-material pouches, paperboard cans, and PET/PP trays allow easier recycling and waste management. Bio-based materials like Polylactic acid PLA and cellulose are also being evaluated. Smart packaging features like oxygen scavenging films, leakage indication, and track-and-trace solutions also provide sustainability benefits. Such innovations expand the applications of retort packaging.
- Growing usage in emerging industries: Retort packaging is gaining prominence in emerging industries beyond food, like pet food, baby food, pharmaceuticals, and beverages offering sterile solutions. Pharma companies use retort packaging for drugs, nutraceuticals, and medical equipment requiring sterility. The nutraceuticals segment is also utilizing retort pouches for sports nutrition and supplements. Such applications provide significant expansion opportunities for retort packaging vendors.
Retort Packaging Market Opportunities:
- Rising demand from developing economies: Developing nations in Asia Pacific, Latin America, and the Middle East & Africa offer strong growth opportunities for retort packaging driven by rapid urbanization, rising incomes, and changing lifestyles. Higher spending on packaged and processed foods in these regions is increasing retort packaging uptake. Key target countries include China, India, Brazil, ASEAN, GCC nations, where food retail sector is booming. Local vendors are entering these markets supported by partnerships and expansions. Domestic demand offers huge potential for retort packaging penetration. For instance, as per data from The Indian FMCG Market Outlook Report 2022, the FMCG sector in India was valued at over US$100 Bn in 2021 and is projected to reach US$220 Bn by 2026, indicating substantial potential for retort packaging.
- Entry in flexible packaging providing diversification: Many rigid packaging companies are diversifying into flexible retort pouches to capitalize on their high growth potential. Pouches offer benefits like lightweight nature, efficient sterilization, convenience, and recyclability. Large players as well as smaller regional vendors are launching retort pouches to expand their product portfolio beyond metal cans and containers. The expertise in sterilization and processing further helps companies to enter retort pouches segment. Partnerships with pouch manufacturers also enable market entry. For instance, as per the United Nations World Food Programme, over 78 million people globally will be displaced due to conflicts and climate related disasters in 2022 alone, fueling demand for lightweight and portable food packages.
- Rising pet food demand supporting premiumization: The pet food segment is fast emerging as a key end-use industry for retort packaging. Owners are willing to pay a premium for high-quality foods with attractive and convenient packaging. Retort pouch suitable for pet food that can be packed in small quantities . Premiumization through packaging innovations such as spouts, zippers, and convenient shapes is gaining popularity. Natural and organic pet food products also leverage the anti-counterfeiting features offered by smart retort packaging solutions. For instance, according to data from the American Pet Products Association, over 70% of U.S. households now own a pet. Growing pet ownership and humanization in key regions like North America and Western Europe indicate a strong future demand for premium nutrition.
- Growing food processing industry and contract manufacturing: The expanding food processing and contract manufacturing sector offers substantial scope for retort packaging uptake. Food manufacturers are increasingly outsourcing production to third-party contract manufacturers. This is driving installations of large-scale, high-speed automated retort sterilizers by contract manufacturers to cater to varying customer requirements. Retort packaging suppliers provide customized solutions and services to such processors to enhance market presence.
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