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Double pressure for the domestic packaging industry

The strong growth of the food packaging sector has resulted in an average growth rate of 15-20% per annum. Plastic packaging achieved a growth rate of 25% per year.

This opportunity leads to fierce competition between domestic and foreign packaging enterprises. And, in that competition, losers always favor Vietnamese businesses.

Domestic enterprises, especially small and medium enterprises, are showing a lot of pressure when they are forced to compete with foreign companies who are both dependent on raw materials and vulnerable in the race. high tech machinery

According to market research firm Euromonitor, the demand for food packaging in Vietnam in 2015 is 3.915 million tons, by 2020 it will be 5.396 million tons, up 38%, while the demand of the world in In the period of 2015-2020, only 13%.

Opportunity to open

Sharing at the International Exhibition of Food, Beverage and Pharma Industry in Vietnam (ProPak Vietnam 2017) held in Ho Chi Minh City last March, BT Tee - General Director of Translation Company SES Vietnam said: 'Demand for consumer goods, packaged food, bottled beverages and pharmaceuticals is increasing in Vietnam. It is expected that the export of these items will grow strongly, leading to the demand for packaging.

Double pressure for the domestic packaging industry

Paper packaging plays an important role in the food processing industry. Picture: Le Toan.

Robert Graves, general director of Tetra Pak Vietnam, said: "Vietnam is in Tetra Pak's top 10 markets. Last year, Tetra Pak supplied about 7.5 billion packages for the domestic market, achieving double-digit growth over the previous year, and the fastest in 25 years, with the largest volume of dairy packaging. , fruit juices, wine '.

Nhan Huc Quan, General Director of New Toyo Aluminum Foil Packaging Company, said: "In the past few years, although there has been no sudden growth, New Toyo's business plan has always been up. .

According to Quan, because of the lower cost of production in Vietnam than in Singapore, Thailand and China, combined with the rapidly increasing demand for F & B packaging, foreign corporations, especially China, Vietnam invest in this field. For example, Lee & Man (China) has invested $ 280 million to build a 420,000 tonne per year paper packaging plant.

According to Robert Graves forecast, in two years, the demand for packaging in the food and beverage sector has increased due to consumption of dairy products, canned fruit continues to increase.

Tetra Pak's analysis shows that although these products have high market share, they are still low compared to the world market. The trend of consumers to switch to ready-to-drink milk is increasing.

According to Tetra Pak's forecast, in 2015, Vietnam's milk consumption will be 25 liters / capita and in 2020 it will increase to 28 liters, showing the potential of milk packaging market in Vietnam. Hard paper packaging accounted for 62.2% and aluminum packaging accounted for 23.3%.

According to Euromonitor, the demand for food packaging in Vietnam in 2015 is 3.915 million tons, by 2020 will be 5.396 million tons, up 38%.

For other liquid foods, about 3.3 billion liters, excluding soap, shampoo, shower gel, and spices, it is likely to grow to $ 351 billion in 2018.

Vietnamese business strength

According to Nhan Huc Quan, FDI packaging enterprises have many advantages over domestic ones. Their machinery, technology is very modern, closed production line from A to Z, most automation so low cost and very high productivity.

The price of raw materials has fluctuated over 2, 3 cycles and now it is up to 10%. In fact, with high quality packaging, market share is still focused on foreign companies such as Tetra Pak (Sweden), Combibloc (Germany) ...

According to Quan, besides the pressure of technology and conveying factors of food safety factors, running the market demand and price competition also put pressure on domestic enterprises. For example, instead of using the product with the packaging removed, consumers prefer to buy products that after use, the packaging can become other things, so the production line of paper packaging that New Toyo has to change, to buy more equipment to produce 50% paper packaging, 50% plastic.

Sharing the competitive pressure, Tran Quang Minh, Director of ThuGang Packaging said that the demand for packaging for pharmaceutical industry still has great potential for development.

However, most FDI enterprises import packaging from abroad, some use packaging in the country, then consider the packaging is only an auxiliary phase in the product, not need packaging so beautiful to attract people. Used as consumer products should always require suppliers to lower prices.

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