PMMI Corner: Continued growth forecasted for the U.S. packaging machinery market
The U.S. packaging machinery industry continues to experience strong growth. The value of domestic shipments of packaging machinery is projected to grow at a compound annual growth rate (CAGR) of 2.4% reaching $8.5 billion in 2020, according to PACK EXPO owner and producer PMMI, The Association for Packaging and Processing Technologies. More than half of this growth is expected to come from the food and beverage sector.
“The 2016 State of the Industry U.S. Packaging Machinery Report” also notes the value of domestic shipments of U.S.-produced machinery rose 0.3% to $7.51 billion in 2015. Exports of packaging machinery in 2015 increased by 3.2%, compared to 2014 and are now $1.1 billion. Backlog orders of packaging machinery grew by 14.1% compared to backlog orders at the end of 2014.
PMMI produces the State of the Industry study based on U.S. Census Bureau reports and shipments data provided by association members who manufacture packaging machinery. The report, which analyzes 28 packaging machinery categories, describes trends and the outlook for packaging machinery shipments through 2020.
According to the report, the labeling, decorating and coding, and case handling machinery groups are forecast to increase the fastest of all machinery types through 2020, at CAGRs of 3.9% and 2.5% respectively. The pharmaceutical sector is forecast to grow the fastest of all sectors through 2020, at a CAGR of 2.8%. This is followed by the beverage sector, which is forecast to grow at a CAGR of 2.4%.
The largest industry sector in terms of shipment revenues is estimated to have been food (37% of shipment revenues) in 2015, followed by beverages (21.7%). The impact of legislation such as the Food Safety Modernization Act (FSMA), the trend toward single-serve packaging and the need for frequent changeovers due to the increasing number of SKUs are powering the increase in shipments in these sectors.
With the changing size of drinks being offered to consumers, the beverage industry has had to respond with more versatile equipment. While the demand for carbonated soft drinks has generally been declining, consumption of bottled water has been on the rise; largely driven by the consumer trend toward a healthier diet. Other segments that are forecast for strong growth include energy/sports drinks, craft beers and iced teas.
On the food side, as consumers lead increasingly busy lifestyles this is fueling growth in processed convenience foods and ready meals, which are perceived as convenient, but not particularly healthy options. As with retail in general, there is a movement toward online shopping and consumers having groceries delivered directly to their doors. There is also an emphasis on healthier lifestyle driving demand for new alternatives such as wheat-fee, gluten-free, low-fat, and low-sugar products as well as fruits and vegetables.
Cutting-edge technology and innovative solutions for the food and beverage industry will be on display at ProFood Tech (April 4-6; McCormick Place, Chicago). Powered by three of the world’s trade show leaders – PACK EXPO, Anuga and the International Dairy Foods Association (IDFA) – this biennial show is unprecedented in its ability to bring the industry together and address the key issues facing food and beverage processing operators in North America.
In regard to packaging machinery categories, the rapid growth anticipated in the labeling, decorating and coding, and case handling segment is largely a result of new legislation demanding increased labeling and coding, continuing developments in printing technologies and the proliferation of SKUs.
With the strong growth of the industry and the many challenges faced to meet market demands, a top destination for discovering new and innovative packaging technology is PACK EXPO Las Vegas (Las Vegas Convention Center; Sept. 25-27).
Maria Ferrante, senior director, marketing and communications, PMMI, The Association for Packaging and Processing Technologies
PMMI, The Association for Packaging and Processing Technologies, actively brings buyers and sellers together through initiatives such as packexpo.com, educational programs and world-class events, connecting participants in the processing and packaging supply chain with their customers around the world. PMMI produces the PACK EXPO portfolio of trade shows, which includes PACK EXPO Las Vegas 2015 (Sept. 28–30; Las Vegas Convention Center) and Pharma EXPO, co-located with PACK EXPO Las Vegas 2015. PMMI owns PMMI Media Group, a market-leading B2B media company that produces information for processing and packaging professionals, bringing together solution providers and end-users and facilitating connectivity throughout the supply chain. Its world class media brands are proven leaders in covering this diverse and dynamic marketplace, and its digital products incorporate leading edge media technologies to deliver informed, actionable business intelligence to the industry.