Food Packaging Market in India 2023 – 2028

Food Packaging Market in India 2023 – 2028

Market insights:

Factors such as population growth, rising incomes, changing lifestyles, and increased media penetration have contributed to higher demand for packaging products. The packaging industry in India serves a diverse range of products and industries, and companies have established manufacturing facilities to export products globally. The industry faces challenges like fluctuating raw material prices, regulatory changes, environmental concerns, limited recycling, and a lack of modern machinery. The food and grocery market contributes significantly to food packaging demand, driven by both urban and rural retail stores. Manufacturers are launching sustainable packaging solutions in response to the growing demand for eco-friendly options. The food packaging market in India was valued at INR 2,515.84 Bn in 2022 and is expected to reach INR 5,225.76 Bn by 2028, expanding at a CAGR of ~13.56% during the 2023- 2028 period.

Market Influencers:

Drivers

The Indian food packaging market is flourishing due to the rise of quick-service casual restaurants, driven by urbanization and busy lifestyles. Quick-service restaurants cater to the preferences of the young population, particularly millennials and Gen Z, who seek fast and convenient dining options. Packaging companies are innovating to meet the needs of quick-service restaurants, designing solutions that maintain food freshness during transportation. Additionally, the expansion of e-commerce in rural areas contributes to the market's growth, as online platforms provide access to a wider variety of packaged foods. The increased consumption of ready-to-eat meals further boosts the demand for well-packaged, convenient options, with packaging playing a vital role in preserving food quality and safety during transportation and delivery. Online grocery shopping, featuring individually packaged items, adds to the overall consumption of packaging materials, meeting consumer demands for convenience and hygiene.

Challenges

The Indian food packaging market faces challenges due to environmental concerns associated with plastic waste. India generates 9.46 million tons of plastic waste annually, with 40% remaining uncollected, leading to environmental hazards. Major cities contribute over 50% to the total plastic waste. Regulatory measures like the ban on single-use plastics and state-level prohibitions impact the flexible packaging market. Additionally, escalating prices of key raw materials like paper, plastic, adhesives, and resins, influenced by rising crude oil costs, pose significant challenges, negatively impacting the industry's growth.

Market Trends:

Consumers across diverse backgrounds are gravitating towards premium products, transitioning from homemade to ready-made, standard to premium snacks, and basic to organic or luxury items. This shift is fuelling the demand for food packaging. Convenience and health-conscious choices are propelling sales, with brands leveraging health as a platform to introduce new product variants. This trend outpaces overall category growth and alters consumer perceptions of packaged foods due to increased information sharing. Packaging serves as a crucial branding tool, allowing products to stand out, prompting marketers to employ innovative strategies in designing food packaging.

Competitive insights:

The Fast-Moving Consumer Goods (FMCG) sector encompasses the manufacturing and sale of products like food and beverages, personal care items, tobacco, and household care products, presenting a significant opportunity for the food packaging industry. In addition to meeting traditional demands, prominent Indian food packaging companies such as Cosmo Films Limited, Essel Propack Limited, Jindal Poly Films Limited, TCPL Packaging Limited, and others are addressing the increasing requirements arising from e-commerce shipments.