Paper as a label and packaging material is experiencing something of a resurgence. Sometimes fueled by the ever-growing concern and overfilling of the oceans with plastic and thus about plastic consumption and waste, the packaging material is increasingly conquering terrain in all categories. Paper packaging is also well suited for sustainable measures, which in view of the entry into force of the plastic tax of € 0.80/kg will not only decide on ecological sustainability, but also on economic sustainability.

But not only as a packaging material, but also in almost all labeling formats, we see a steady increase. For a long time – the last two and a half decades – it seemed that OPP and other polymers were increasingly displacing label material made of paper. Now the trend is reversing. Back to the paper label again.

The paper industry has not been inactive over the past two decades. Not only has it made technological leaps, but it has also steadily increased its lead in terms of recycling. And it still has a few surprises in store for the future.

In 2020, the paper packaging market could account for more than 40% of global food packaging. A sharp increase can also be expected in the coming years. This is especially noticeable for beverage packaging, as this is where the largest growth rates are foreseen. Paper-based packaging is a lightweight and cost-effective packaging solution that offers the right protection to a wide range of products.

 

Annual growth rates of 4.1-4.4% in the forecast period from 2021-2027

The global paper packaging market is projected to surpass US$ 485.0 billion by the end of 2027, in terms of revenue, growing at CAGR of 4.4% during the forecast period (2020 to 2027).

The steady production growth of paper, which is accompanied by technological advancements and higher efficiency in productivity, will stand out as a major driving factor for the paper-based packaging market. Following the International Energy Agency’s calculations, the growth rate of paper and paperboard production accelerated from 0.7% in 2010-16 to 2.3% in 2017, and demand will continue to increase through 2030, driven by a growing population and economic growth. Thus, the growth in paper production will favor the market growth of paper-based packaging.
The other drivers will be the Circular Economy Act and customer perception. Here, retail is taking its toll on the consumer packaged goods industry to match the perception.

Increasing demand for eco-friendly packaging solutions due to growing environmental awareness is expected to drive the market growth of paper-based packaging. Growing consumer awareness regarding sustainable packaging is also contributing to the market growth of paper-based packaging. In addition, the market growth of paper-based packaging is further favored by the increasing stringent government regulations regarding environmental protection. Regionally, Asia Pacific dominated the global paper-based packaging market in 2019 with a market share of 37% in terms of revenue, followed by North America and Europe, respectively.

 

Wet glue labels on the rise – The same applies elsewhere: “back to paper”

It is also not surprising that there is already increased demand for wet-glue labels in the label business. There is also a strong trend towards paper labels in roll-feed and wrap-around. Underpinning these trends are environmental footprints. Even if sometimes minds are divided and each faction defends its positions.

 

Paper as a material simply has a significant advantage in the holistic view. At least it decomposes much faster than plastic. That is precisely the point: the end-of-life. Despite such high alleged recycling rates, the plastic waste mountains are growing towards the sky and into the oceans. A dichotomy in itself.

There is always talk about recycling rates, but if you look at the real recycling rates measured against production output, you can see the contradiction. Value and material flow analyses are actually the more appropriate means of making concrete statements.

Further effects will not be unavoidable due to the increasing demand for specialty papers on the market. The price of pulp and additives will rise sharply, as will the prices of other packaging materials.

The winners on the market will be all those who can reconcile ecology with economy.