Europe's plastic closures market underscores added value

OUTPUT growth and rising demand for added value and premium products are driving the plastic closures market in Europe.

A new report from industry consultants AMI Consulting forecasts a positive outlook for the sector in the years ahead, with growth in value-added products well above the average. Demand is projected to hit 256 billion units by 2019 at a CAGR of 2% beginning 2014-2019.

Economic recovery in several countries has spurred market growth prospects in recent years. Demand for plastic closures rose from 215 billion units in 2010 to more than 230 billion units in 2014. The solid food and non-carbonated beverages segments registered the fastest growth.

The caps and closures segment, which is becoming increasingly technology-driven on the back of growing R&D investments and technical expertise, is taking advantage of recent technological developments to produce added value and premium products at lower costs yet with faster time to market.

Non-beverage applications are growing faster with several added value and developing niches. Although the beverages segment remains strong, it now represents only 35% of the market.  Polyethylene and polypropylene are the key options for inter-polymer use. The former is increasingly used in beverages, while polypropylene is becoming popular in non-beverage applications.

Market consolidation resulting from organic growth and merges and acquisitions such as that involving 3i Group and Weener Packaging (WPPG) last July is reshaping the structure of the industry. The largest producers in Europe include Alpla, Aptar, Bericap, and Global Closure Systems.

According to AMI Consulting’s Consumer Packaging market analyst Márta Babits, “Brand owners are looking for a full packaging solution for their products in which the role of closures is increasingly valued. Well-designed closures can improve product differentiation, aesthetics, and functionality.”

Ms Babits noted the importance of innovation in protecting and growing profitability. "It will create opportunities for well-informed and well-organized companies,” she said.