How are your FMCG products, confectionaries, frozen foods packed ?
Its Flexible packaging !!!
Siddharth K S , Research AssociateChemicals and Materials – South Asia & Middle East
23th March 2011
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Today’s Presenters
Siddharth K S, Research AssociateFrost & Sullivan
Tanu Chopra, Assistant Manager, Corporate Communications Frost & Sullivan
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Focus Points
• Research Scope
• Market Overview
• Product & Geographic Segmentation
• Product Lifecycle
• Market Forecasts
• Industry Challenges
• Key Market Drivers & Restraints
• Competitive Scenario in the GCC
• Key Competitive factors
• Conclusions
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Research Scope
Market: Flexible Packaging
Region: GCC
Study Period: 2006-2016
Market: Flexible Packaging
Region: GCC
Study Period: 2006-2016
This research service analyzes the GCC flexible packaging market from 2006 to 2016. The base year of the research is 2009. There are several end-user segments such as food and beverages, pharmaceuticals, consumer goods, and other industrial applications. This research study mainly analyzes the film production in the GCC.
Film Manufacturers Converters End UsersResin ManufacturerResin Manufacturers
SABIC
QAPCO
TASNEE
Oman Polypropylene
Taghleef Industries
Novaa Industries
Flex Industries
Napco Group Arabian Packaging
Sun Packaging
Manama Packaging
Printopack
Nestle
Masafi
KraftAl Marai
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Market Overview
• The GCC flexible packaging market is one of the fastest growing sectors in the packaging market due to its extraordinary growth in the past decade. The significance of GCC flexible packaging market is justified by the ease of minimizing the package size, extended shelf life and dynamic shift in user’s mind to convert to flexible packaging over the rigid packaging.
• UAE is the largest manufacturer for flexible packaging in GCC with a share of 46%, followed by KSA (32%) and rest of GCC (22%).
• The foods industry is the largest end user of flexible packaging with 60% market share while FMCG holds 25%, Medical industry holds 10% and others constituting 5% of the market. Market Share Split by Key Regions (GCC),2009
Note: All figures are rounded; the base year is 2009. Source: Frost & Sullivan
Note: All figures are rounded; the base year is 2009. Source: Frost & Sullivan
Market Share Split by Key End-user Industry (GCC),2009
Kingdom of Saudi Arabia
32.0%
United Arab Emirates
46.0%
Rest of GCC22.0%
Food60.0%
FMCG25.0%
Medical10.0%
Others5.0%
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Product Segmentation and Geographic Segmentation
The GCC flexible packaging market has been divided into three segments, namely Kingdom of Saudi Arabia, the United Arab Emirates, and rest of GCC (which includes Kuwait, Oman, Qatar, and Bahrain). Within each region, the market is segmented by different product categories, such as polypropylene, polyethylene, polyvinyl chloride, polyester and others.
Product Segmentation
Polypropylene
Polyethylene
Polyvinyl chloride
Polyethylene terephalate
Others (polyamide, polyolefin, polycarbonate)
Geographic Segmentation
Rest of GCC (Kuwait, Qatar, Bahrain and Oman)
United Arab Emirates (UAE)
Kingdom of Saudi Arabia (KSA)
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Product Life Cycle
IntroductionGrowth
Maturation Decline
Time
Use of Flexible
packagingMaterial
The polyethylene based packaging market has attained the maturity level, with HDPE,LDPE, and LLDPE product segments. BOPP and
CPP are extensively used in flexible packaging for laminating and printing. Polyolefin and polyamide are in their growth stages, mainly
due to their barrier properties. The bio based films made from starch and cellulose are eco friendly and are gaining importance in the
packaging market.
Total Flexible Packaging Market: Product Life Cycle (GCC), 2009
Source: Frost & Sullivan
POF
PVC
PET
PE
PA
PP
BioBio Based Films
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Market Forecasts
0
100
200
300
400
500
600
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
-1
1
3
5
7
9
11
KT/Year
Growth Rate (%)
KT
/Yea
r
Unit G
rowth
rate (%)
Year
CAGR : 8.4 %
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Industry Challenges
• Environmental Concerns
• Fluctuating raw material cost
• Lack of proper marketing of flexible packaging
• Political Climate
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Key Market Drivers and Restraints
Higher preference Towards processed And packaged foods
Growth inFMCG & Retail
Sector
Replacement/Substitution of
Rigid Packaging
Increased Competition from
Countries like IndiaAnd China Preference towards
Low cost and low Quality packaging
Key Drivers
Key Restraints
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Competitive Scenario in the GCC
•KSA is the leading end user of flexible packaging in the GCC.
•Major suppliers of flexible packaging films are Gulf Pack, Napco, Obeikan flexible packaging & Olayan flexible packaging among others.
• Major film manufacturers holds about 75% of the market
• KSA has fewer flexible packaging film manufacturers. Thus, the raw materials are imported from other GCC states and also from other countries in Asia, Europe, and the United States. The films procured from other countries are processed into flex packs by the converters operating in the region.
Kingdom of Saudi Arabia United Arab Emirates
•UAE is the leading manufacturer of flexible packaging in the GCC.
•Major suppliers of flexible packaging films are Taghleef Industries , Flex Middle East FZE, JBF Rak LLC, Novaa Industries among others.
• Major film manufacturers holds about 74% of the market
•UAE is also a leading end user of flexible packaging in the GCC , behind KSA.
•With free trade zones and friendly government policies, UAE is witnessing high foreign direct investment.
•There is minimal imports of films into the country. There are also lots of converter companies operating in the country.
•The flexible packaging market in the rest of GCC region is at very nascent stage.
•There are a few convertors who operate in the region with capacities to manufacture basic polyethylene films internally.
•The main film manufacturer in the region is Taghleef Industries at Sohar ,Oman and Qatar Plastic products company.
•The other major companies with limited film production capabilities in the rest of GCC region are Manama Packaging in Bahrain , Sun Packaging and FIPCO in Oman.
• With Qatar, winning the bid to host the football world cup, the scene is poised to change in the rest of gcc region.
Rest of GCC- Qatar/Oman/Kuwait & Bahrain
12P3F7-39
Key Competitive Factors
Product quality and innovation
Market Responsiveness
Distribution network
Customer service
Price
Market Leader
Source: Frost & SullivanSource: Frost & Sullivan
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Conclusion
CONCLUSIONS
The GCC flexible packaging market is currently growing at CAGR of 8.4%. The major powerhouses for the flexible packaging are the countries like UAE , KSA and Qatar. Qatar, especially with an impressive GDP and with the license to hold the world cup showcases immense potential for growth in the flexible packaging market. UAE has most number of converters and film manufacturers in the region, while KSA holds the largest market share. With the economic recovery and preference towards processed foods , the GCC flexible packaging market is at the threshold of attaining global importance for packaging. Another major emphasis is on the environmental impact of packaging. The concept of sustainable packaging is seen to be taking shape in the region. The 3 R of recycle, reduce and reuse are being practiced by most of the companies operating in the GCC region.
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Key Industry Participants
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For Additional Information
Vishnu Shankar Industry ManagerChemicals and Materials Practice+971 44 33 [email protected]
Gayathry RamachandranResearch ManagerChemical and Materials Practice(91)-44 -6681 [email protected]
Tanu ChopraAssistant ManagerCorporate Communications, MENA+91.22.6607 [email protected]
Ravinder KaurAssistant ManagerCorporate Communications- South Asia+91 44 6160 [email protected]