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Confectionery flexible packaging sales ‘unchanged’ in 2016

Flexible packaging sales for sugar and chocolate confectionery in Europe were broadly unchanged last year, a new report suggests.

PCI Wood Mackenzie’s latest review of the European marketplace, ‘Flexible Packaging Supply Demand Study – Europe to 2021’, reveals the fastest growing major flexible packaging markets in Europe in 2016 were Italy, Poland and Turkey, each growing by more than 3% during the year. This compares with growth in European flexible packaging of 2.1% overall.

According to the report, Europe’s €13.8 billion flexible packaging market remains one of the largest in the world, accounting for around 18% of the global total in 2016.

End uses are growing faster than the market as a whole and include coffee, snack foods and fresh produce. However, flexible packaging sales for sugar and chocolate confectionery, one of the largest categories, were broadly unchanged.

Looking forward, PCI Wood Mackenzie forecasts that overall flexible packaging demand will pick up slightly in Europe in 2017, subsequently growing by 2.2% p.a. to reach €15.5bn in 2021.

PCI Wood Mackenzie’s Paul Gaster, says, “For the third year in succession there have been few inflationary pressures with volume consumption growth in most European countries broadly tracking that of value. Poland, in particular, stands out as a major market where demand has continued to grow strongly, underpinned by robust domestic demand and a successful focus on packaged food exports, especially into Western Europe.”

Poland’s flexible packaging industry has achieved success by supporting the high levels of inward direct investment made by multinational food brand owners in recent years, keen to take advantage of growing packaged food markets in Eastern Europe and lower production costs available in the Polish market.

In Italy, demand grew by 3% underpinned by the growing importance of supermarket retailing and changing consumer buying habits.

Growth in Turkey, while significantly lower than earlier in the decade, continues to be boosted by a growing national economy, urbanisation and relatively rapid population growth, including the influx of more than three million refugees fleeing the civil war in Syria, many of whom have now put down roots in Turkey, the report says.

There has been some significant M&A activity in flexible packaging over the past year – 26 converters with more than €100m of flexible packaging sales now account for nearly 70% of the total market.

Mondi has been active, having concluded three significant bolt-on acquisitions, buying Uralplast (Russia), Kalenobel (Turkey) and Excelsior Technologies (UK).

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