The European Union’s (EU) food and beverage glass container packaging industry has grown to become “very stable” against other packaging sectors but must remain wary of a number of growing challenges, according to the latest forecast from Rabobank.
Demand for glass packaging for food and beverage products within the EU has remained stable in unit terms for many years, Rabobank said, in contrast to rigid metal, rigid plastics and flexible packaging materials, which have all experienced relatively high growth rates.
This is partly due to growth in segments in which glass packaging is not traditionally used, such as meat and convenience food, but also due to changes in the competitive position of glass packaging.
The glass packaging industry’s competitive environment has been forcing major industry players to adapt in order to remain competitive, Rabobank said. Many have consolidated significantly in the past 10–15 years, with the market share of the ten largest brewers increasing between 2015 and 2016 by almost 10%.
And, in 2015, beverage bottles represented about 78% of demand for food and beverage glass containers in the EU. This share has slightly declined, while food containers have gained importance in the past ten years. As beer bottles represent the single-most important glass packaging category, changes in the beer sector can be felt across the entire industry, Rabobank said.
It warned that falling beer consumption and pressure from rival packaging materials were restricting glass packaging’s growth. Glass bottle manufacturers could scale, innovate or consolidate to overcome the challenges of the industry, Rabobank added.
One of the most surprising aspects of the glass packaging sector is its retention of relatively high profit margins.
Rabobank global F&A supply chains strategist Susan Hansen said: “All in all, we believe that the outlook for the glass container industry will remain stable, yet challenging going forward. Focusing efforts on increasing flexibility and considering innovation as an ongoing process are key. Despite glass bottles/containers being a traditional or preferred packaging material for specific products like beer, spirits, wine or olive oil, there is no guarantee that this will not change in the future.”
As the global container glass industry descends on Germany this month for Glasstec, such findings will doubtless make a few breathe a little more easily from the technology supply side.
Happy reading…and enjoy Glasstec!