Plastic food packaging makers seek sustainability

Wrapped for good

16 October 2008 00:00  [Source: ICB]

Used to package nearly all the food products found in a supermarket, plastic wrapping is in no danger of passing its best-by date

ALTHOUGH NO-ONE is sure how the economic downturn will affect consumer trends, shoppers still want the convenience that plastic food packaging brings, and it is up to the value chain to make the product sustainable.

With convenience a top priority for many people, ready-to-eat meals will continue to be the trend, says Canada-based NOVA Chemicals. Dow Chemical, of the US, also cites consumer convenience, along with quality and safety, as the driver for innovation in food packaging.

A recent report from the Ohio-based Freedonia Group points to the increasing popularity of convenience foods in the growth for converted flexible food packing. The consultancy expects the packaging category to expand by 4.5%/year to $11.6bn (€8.5bn) in 2011. Demand for produce packaging is projected to approach $4.7bn in 2012.

Plastic films, which already account for more than 70% of global demand, will continue to make inroads at the expense of paper and aluminum foil. US demand for plastic film will reach 16bn lbs (726,000 tonnes) in 2012 the segment (including nonpackaging applications) is currently worth about $25.4bn.

"Consumer packaged goods companies are always looking to provide more convenience to customers," especially those in the US, says Jeff Wooster, senior value chain manager for Dow. Consumer packaged goods (CPGs) are consumables such as food and beverages, as well as items like footwear and apparel, tobacco and cleaning products.

Another consultancy says the market for plastic packaging for food and drink is primarily stimulated by rising disposable personal income, an expanding population, smaller household sizes and rising consumption of convenience foods. According to California-based consultancy Global Industry Analysts (GIA), strong advances are also anticipated in food markets based on rapid growth in prepacked food, fresh produce and prepared foods packaging. Plastic films are also expected to continue to make inroads in food packaging, shrink-wrap and stretch-wrap.

While supermarkets have offered store-brand foods for years, recently they have ramped up their selection because of greater competition from big-box stores like Wal-Mart and Costco. The supermarkets' own labels have grown beyond basics such as eggs and milk to gourmet salsa and organic salad dressing.

Daniel Pepitone, communications manager for German chemical giant BASF, says: "Exclusive store brands could become even more popular this year, as higher food prices and a sluggish economy have shoppers looking for ways to trim grocery bills."

SAME DIFFERENCE

When companies introduce innovative packaging, they still try to keep the look of the product as close to the old one as possible, both in terms of packaging and the touch and feel of the product itself.

"The brand managers do not want to alienate their existing consumers with a package change," says Wooster. "There's almost always something that is carried over from the old packages to give a sense of connection and familiarity to the consumers."

The major polymers used in plastic packaging include polypropylene (PP), polyethylene (PE), polystyrene (PS), polyvinyl chloride (PVC) and polyethylene terephthalate (PET), all of which are affected by the cost of crude oil and natural gas.

Applications such as fresh produce packaging require structures that allow the produce to remain fresh throughout the supply chain, helping to reduce spoilage and extend the shelf life, says Andrew Summerscales, market manager, food & specialty packaging films at NOVA Chemicals.

But such plastics may not be cheap. "A product that retains freshness requires film structures with relatively high oxygen and moisture vapor transmission rates, which are typically only found in high-cost plastomers," explains Summerscales.

And prices will be going up. Gary Steele, chairman and CEO of California-based specialty polymer maker Landec, has warned that he expects the costs of produce, materials and freight to rise in fiscal 2009 compared with fiscal year 2008, "primarily due to increased energy costs, which means we need to selectively increase prices where we can and continue to improve operating efficiencies." Steele projects growth "somewhere between flat and 5% for the year as just my best guess."

The US packaged food market itself is nearly a $3bn/year industry, says NOVA, with the US and Europe consuming 74-100lbs (34-45kg) of PE per person per year. People in the BRIC countries, however, (Brazil, Russia, India and China) consume only about 4-22lbs of PE/year.

"When we look at how polyethylene resins fit into this picture, it's important to consider the global economy," says Summerscales. The difference in consumption between the US and Western Europe, and BRIC, is largely due to the fact that emerging economies do not package most of their food, and unpackaged food is more susceptible to spoilage.

PE UPSIDE

"But polyethylene packaging can extend the shelf life of many of these foods and we see tremendous upside potential for polyethylene food packaging in the next few years," says Summerscales. "We view these statistics as indicators of tremendous growth potential for polyethylene resins."

However, performance enhancements and cost savings must be substantial enough to outweigh the costs and the market risks of change, says BASF. This includes other economic factors like the cost of new materials the cost of changes in packaging process or steps and the need for research and development (R&D) spending to innovate and implement new solutions.

"The liability associated with food and medical packaging makes it more expensive and riskier to pursue change than with other end-uses," points out Pepitone.

But he adds that the potential cost should not slow down R&D spend: "It is a risk not to innovate, because the changing landscape and advent of new materials and processing techniques will help to drive change. Someone will be first."

NOVA, Dow, BASF and other manufacturers are all seeing an increased demand for sustainable packaging solutions that do not sacrifice performance or the bottom line.

"People are trying to make sure their packages use the materials that are in them as efficiently as possible," says Wooster.

Summerscales adds: "As sustainability becomes more important, the package designer must also achieve sustainability objectives without incurring additional cost to the total packaging solution."

NOVA's most recent development in film applications for food or food-related products is the SURPASS HPs 167-AB resin. The company says it is suitable for any application where moisture barrier performance and stiffness are important, such as cereal liners, meats and cheeses, ready-to-eat meals, pet foods and others.

To develop applications for its resin, NOVA's technical staff worked closely with a major North American cereal producer and its film converters to engineer the best solution for all parties. "The result is a finished package that provides excellent product freshness, while reducing the amount of film needed, which reduces costs and helps meet sustainability objectives," says Summerscales.

"When it comes to 'greening' one's packaging, less is often best," says Pepitone. He adds that the alterations made to packaging to make it more environmentally friendly are often calculated in microns.

For Dow, sustainability also means providing products and service to customers all the way down the value chain. The company, says Wooster, keeps track of its resins, from the packaging manufacturer that Dow sells the resin to, then the downstream brand owner or CPG company, in an effort to keep the value chain successful.

PLASTIC PACKAGING: ALWAYS

EFFICIENT AND EFFECTIVE

According to the American Chemistry Council (ACC), about 2lbs (0.9kg) of plastic can deliver 1,000 ounces (28.4 liters) of a beverage. It takes 3lbs of aluminum, 8lbs of steel or 27lbs of glass to deliver the same amount of liquid.

Plastic jars can use around 90% less material by weight than their glass counterparts, while plastic containers use about 38% less material than metal containers of the same size. Newer, lightweight, flexible packaging made from either plastic or plastic-and-foil composites can use 80% less material than traditional bag-in-box packages, says ACC.

The ACC says contemporary two-liter plastic beverage bottles and one-gallon milk jugs weigh roughly 33% less than they did in the 1970s.

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By: Ivan Lerner
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