Indonesia Paper Packaging Market - Growth, Trends, Covid-19 Impact, and Forecasts (2023 - 2028)

Indonesia Paper Packaging Market - Growth, Trends, Covid-19 Impact, and Forecasts (2023 - 2028)

The Indonesia Paper Packaging Market will register a CAGR of approximately 4.15% during the forecast period. Packaging materials made of paper are widely used for packaging various goods, including food, medical, and personal care items.

• Due to their eco-friendly quality, paper packaging is becoming more popular in Indonesia. Paper is used more frequently as an exterior covering to keep the products together in a multi/bundle box.
• Additionally, the need for folding cartons is being favorably impacted by the demand of healthcare and pharmaceutical industries for simple-to-transport, biodegradable, and recyclable packaging options for medications and related items.
• Furthermore, as environmental concerns became more prominent, the general public's emphasis on sustainability increased. People are becoming more environmentally conscious, which indicates that they are making more sustainable purchases, which has resulted in the food packaging industry experiencing a shift in consumer preferences.
• Paper is made from newly planted forests' tree fibers or recycled paper. Deforestation and forest degradation are global issues. To begin with, approximately half of the world's forests have vanished. Every year, another 13 million hectares of trees are lost (though afforestation replaces eight). According to the World Resources Institute (WRI), around 22% of the world's old-growth forests remain intact.
• With the outbreak of COVID-19, the demand for the transport packaging flow of necessities, such as packaging for food and other consumer products, medical and pharmaceutical products, as well as tissue and hygiene products, and the demand for paper packaging, increased significantly in the nation.

• Local markets in the country are witnessing tremendous industrial expansion, and businesses are forming new strategic alliances in the region, which is why the corrugated packaging market in the entire Asia-Pacific region is witnessing immense growth.
• Other elements, such as urban populations' growing environmental consciousness, the nation's increasing demand for sustainable packaging solutions, the rise in demand for convenient packaging, and the expansion of e-commerce activity, are also accelerating the growth of the corrugated packaging market in powerful nations like Indonesia.
• The usage of corrugated boards for packaging is increasing due to the significant demand for Fast-Moving Consumer Goods (FMCG) and branded consumer durables worldwide. Corrugated boards are widely used in the food & beverage sector to package processed foods, including bread, snacks, Ready-To-Eat (RTE) meals, meat products, fruits, durable foods, and beverages.
• Food service establishments, for instance, use corrugated boxes for packaging pizza. The demand for catering high-quality packaging services has been driven by a shift in consumer lifestyle and the increased desire for convenience food, fueling the expansion of the corrugated board industry across the country.
• In May 2021, SCG Packaging PCL increased its packaging investment in Indonesia by acquiring a 75% share in IntanGroup, a corrugated packaging company located in four central provinces. This development is part of the company's plan to increase its investment in the ASEAN area. The corporation believes that expanding corrugated packaging will benefit the industry.

• Paper packaging is being extensively used in the food sector. It is both environmentally beneficial and convenient for consumers. As a result, there is tremendous competition in the food & beverage industry among companies that provide high-quality products to consumers. Various packaging materials, such as cardboard and corrugated boxes, are available in the market to satisfy multiple packaging needs.
• Moreover, the e-commerce platform has gained a lot of attraction in this region's food market. This is because it offers various food products and ensures they are delivered on time and in proper packaging. As a result of the expansion of e-commerce, food packaging demand is expected to rise. This is because good, innovative packaging preserves the product's quality and extends its shelf-life.
• Furthermore, millennial customers in the region are primarily driving the demand for flexible paper packaging solutions, as they favor single-serving and on-the-go food and beverage products. Flexible paper packaging is a common alternative for packing these products because they are meant to be portable, sturdy, and lightweight. The need for flexible packaging from the food & beverage industry in the region is likely to be governed by the fastest-growing categories of snack foods, both in terms of fresh goods and processed foods.
• Additionally, rising per capita income, urbanization, and a young population is expected to boost the country's packaged food and beverage (F&B) segment's rise. This will help fuel the increase in folding carton packaging in the food retail and restaurant industries. Paper packaging will benefit from growing concerns about the sustainability of plastic packaging.

The paper packaging industry in Indonesia is moderately fragmented due to the presence of several major market players in the country who hold the majority share. The market players such as, PT Industri Pembungkus Internasional, PT Fajar Surya Wisesa Tbk, PT Metaform (Kompas Gramedia), AR Packaging Group AB, and Rengo Co. Ltd, are considering strategic partnerships and collaborations to expand their market share.

• In September 2022, Rengo Co., Ltd. announced its acquisition of MarufUnited Kingdomu, and the agreement strengthened the company's potential to expand its folding carton and flexible packaging operations further in each region.

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