Europe Paperboard Packaging Market Share was USD 31.01 billion in 2019 and will witness a CAGR of 2.9% up to 2026.
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Paperboard packaging is the most preferred packaging material used in various end-user industries such as the food & beverage and electronic industries. The growing consumption of consumer goods and rapid modernization of transitioning regional economies are the major driving forces promoting the market growth. Government entities are actively introducing and promoting environmentally friendly and sustainable packaging solutions to decrease environmental impact and increase consumer awareness. In August 2019, France introduced a 10% increment in prices of unrecycled plastic packaging. Furthermore, big companies are also investing in sustainable packaging research and alternatives to plastic for future products.
The major end-users are focusing on sustainability as a major competitive factor to maintain their market share. These companies are branding themselves as sustainable and eco-friendly organizations. For instance, in January 2020, Nestle announced a USD 1.9 billion investment to lead the shift from virgin plastic to recycled food-grade plastic, an innovative and sustainable packaging alternative. Companies focus on downsizing of packaging (light-weighting), increased use of recycled content, improvement in logistics & packaging efficiency, increased use of renewable source materials, and increased waste recovery coupled with recycling. The majority of companies are a part of the Sustainable Packaging Coalition, an industry group dedicated to a robust environmental vision for packaging. The group helps companies develop sustainable packaging systems.
The impact of COVID-19 has positively impacted Europe paperboard packaging industry, primarily driven by the food & beverage industry. During the early spread of the virus, the demand for essential packed food & beverage products surged and companies struggled to fulfill the rapidly changing demand landscape and faced supply chain disruptions. Furthermore, the rapid rise in e-commerce promoted the growth of paperboard packaging in F&B and online pharmacy & drug store sales, contributing to the growth outlook. Owing to stringent lockdowns and movement restrictions, factors such as excessive essential buying, panic buying, and prioritizing consumer expenses ultimately drove the product demand.
Based on raw material, the European industry is segmented into fresh sources and recycled sources. Recycled source accounted for more than 70% share in 2019 in terms of volume and is expected to increase owing to increasing recycling efforts and government initiatives. Europe accounts for major recycling operations and is expected to further increase its efforts owing to aggressive environmental targets and increasing consumer awareness. Fresh source is further segmented into wood pulp and other sources. Wood pulp is a major shareholder in the fresh source segment owing to high-quality and existing industry expertise with the material. The wood-based fresh source is also essentially dominant owing to an established supply chain and superior recyclable properties.
Based on the product segment, the market size is classified into boxboard and containerboards. Containerboard is anticipated to remain dominant owing to its lightweight characteristics to increase supply chain efficiency and superior product safety. The product boasts structural toughness, resistance to damage from stacking, and minimal impact.
The food & beverage industry is set to grow at 2.2% CAGR in market volume. The segment is a major consumer of disposable and one-time-use packaging solutions. Increasing prospects of processed food & beverages, especially in the developed EU economies are expected to drive the segment growth significantly.
Germany held the largest share amongst all EU economies with a volumetric share of over 35% in 2019. The country is the largest EU economy and has witnessed consecutive growth in terms of domestic packaging consumption and production. Stringent environmental norms in Germany have provided the paperboard packaging industry with an opportunistic scenario.
The major players propelling the market are Mondi Plc, Metsa Group, Stora Enso Oyj, Smurfit Kappa Group Plc, Nippon Paper Group, International Paper Company, and several others.