The Vietnamese paper packaging market was valued at USD 1. 97 billion in 2020, and it is expected to reach USD 2. 89 billion by 2026, registering a CAGR of 6. 96%, during the forecast period (2021-2026).
New York, Aug. 18, 2021 (GLOBE NEWSWIRE) -- Reportlinker.com announces the release of the report "Vietnam Paper Packaging Market - Growth, Trends, COVID-19 Impact, and Forecasts (2021 - 2026)" - https://www.reportlinker.com/p06129761/?utm_source=GNW
With the outbreak of COVID-19, paper packaging is witnessing significant traction in the healthcare sector of Vietnam. In the context of the COVID-19 outbreak increasing in Hai Duong province since early February 2021, SCG Packaging (SCGP) offered convenient solutions for the local healthcare workforce in the COVID-19 battle. SCGP gave 10,000 paper boxes carrying provisions for the community present in the Cam Giang quarantine area and designed and produced 100 paper beds for the field hospitals in Hai Duong.
- Vietnam is one of the steadily growing markets where the packaging demand for paper dominates the country’s paper consumption. According to the data published by the Vietnam Pulp and Paper Association (VPPA), the consumption of paper for packaging in the country during May 2021 stood at 404,711 metric tons, which was slightly down (4%) compared to the previous month.
- Further, according to Hootsuite, the e-commerce spending growth in Vietnam was highest for food and personal care at 45.9% in 2020. The eco-friendly products made from paper have the potential for growth in the food packaging industry to replace the disposable plastic products, which was in line with the government’s policies on environmental protection launched by the Ministry of Natural Resources and Environment.
- At the same time, the free trade agreements have also provided an opportunity to export the country’s packaging and packaging paper to the tax-incentive markets. The use of mini-flute corrugated boxes in some applications has enabled corrugated boxes to expand their presence in markets, such as cereal boxes and carryout food packaging.
- In 2020, the Vietnamese government introduced a national e-commerce development plan for the country, which has been the sector growth by 25% each year to reach USD 35 billion in sales within the next five years. This five-year e-commerce strategy primarily aims to do half of the country’s 96 million population shopping online by 2025.
- Moreover, the increasing demand for packaged goods has been underpinning the recovery of Vietnam for packaged goods. For instance, over the past few years, the flexible packaging industry in the country witnessed high levels of inward direct investment from foreign food brand owners, thus, expanding the potential or capacity of production, driving the paper industry enterprises in Vietnam. For instance, previously, Eastern Tan Mai Joint Stock Company was authorized to build an Eastern Mai Hanh packaging Paper Factory specialized in producing packaging paper with a capacity of 150 metric tons/year.
- Further, Vietnam’s paper industry has been facing difficulties in production due to the high cost of imported raw materials, through production has been stable since the start of this year. According to VPPA, global pulp prices increased by an average of 42% within a year, and they are likely to continue to grow. Meanwhile, Vietnam has a smaller number of large-capacity producers of commercial pulp. The domestic pulp industry only meets around 21.8% of domestic paper production demand. The rest of the need is completed by an imported pulp, paper, and waste paper for domestic paper production. It indicates that the exports are very few from the Vietnam side.
Key Market Trends
Food & Beverage Industry Accounts For the Largest Market Share
- The strong growth in the food packaging sector in Vietnam has resulted in the increased demand for paper packaging in the country. It is also forecast that eco-friendly products made from paper can grow in the food packaging industry to replace disposable plastic products.
- Moreover, the government strongly advocates dairy consumption, notably by implementing school milk programs. In October 2020, Vietnam Dairy Product JSC ("Vinamilk"), one of Vietnam’s first advocates for the School Milk Program, marked its contribution toward the health and well-being of 3.3 million students on World Milk Day 2020.
- Further, increasing consumer demands for convenience in urban areas are among the major drivers for packaged naturally healthy beverages. Buying ready-to-consume juice is much easier and less time-consuming than making freshly squeezed or brewed beverages at home.
- Beyond milk, other dairy products have been gathering momentum in Vietnam, including yogurt. In Vietnam, yogurt has long been considered a wholesome choice, and there is a scope for vendors to explore this segment. By leveraging the natural benefits of yogurt products and presenting them in smaller packaged portions, companies can appeal to increasingly health-conscious Vietnamese consumers and allow them to indulge in guilt-free snacking.
- Further, vendor activities in the region have been contributing toward shaping the market landscape. In the mid of 2020, SIG and Nestlé Vietnam launched combismile in Vietnam to target the growing demand for convenient and nutritional on-the-go drinks. With support from SIG, Nestlé Vietnam has expanded its popular range of Milo malted milk with MILO Breakfast and MILO Classic.
- Additionally, the new combismile packs offered by Nestlé Vietnam carry the FSC (Forest Stewardship Council) label confirming that wood from FSC-certified, responsibly managed forests and other controlled sources is used for the manufacture of the unprocessed cardboard.
E-commerce & Consumer Electronics Segment to Drive the Market Growth
- E-Commerce has earned customers’ trust in terms of quality deliverables and aftersales support, which supports them for multiple orders online. In reply to this, packaging solution providers give robust packaging solutions to sustain damages throughout handling and logistics in Vietnam.
- As surveyed in 2020, around 88% of internet users in Vietnam have shopped online, indicating an increase from the previous year. In that year, food was the most popular online shopping category among shoppers in the country. (As per Ministry of Industry and Trade).
- In June 2020, Tiki raised USD 130 million from NorthStar Group and a majority stake investment from China’s JD.com. Another example of these investments is the USD 51 million deal of Sendo.vn from Japan’s SBI Holdings. Grab and Gojek, the region’s two most valuable startups, have evaluated the terms of a potential merger. This merger has the power to shift market dynamics across Southeast Asia’s e-commerce sector.
- Moreover, the Vietnamese electronic industry is one of the fastest-growing and most crucial industries in Vietnam. Dominated by multinational businesses, the industry has significantly boosted Vietnam’s trade volume and contributed to its GDP in the past decade. Electronic products include a vast range of fragile products and need extra care while shipping, packaging of these goods must have a protective feature. Window Cartons are the type of cartons usually used for packaging in the electronics industry. They have a transparent window that helps the customer get the idea of that product. Switches, lamps, and bulbs are some products that are usually packed in window cartons.
- Additionally, the mobile market in the country is the revived category of consumer electronics, which has the most extensive penetration. With constant development by the technologies, smartphone market growth is augmenting. Also, in response to this growth, e-commerce businesses are partnering for their distribution and launches, resulting in the increasing demand for the e-commerce packaging market.
- Further, online shopping in Vietnam has been boosted recently by movement restrictions related to the coronavirus outbreak, with online sales rising by up to 20% from the pre-pandemic period. Furthermore, Vietnam has been aiming for double-digit annual growth in the turnover of e-commerce over the next five years. As per the government of Vietnam’s data on e-commerce development strategy, more than half of Vietnam’s 96 million people are set to shop online by 2025. Such expectation would lead to higher demand for carton paper in the e-commerce sector.
The Vietnam Paper Packaging market is moderately competitive and consists of many significant players, with some of the top players accounting for a substantial chunk of the market share. Some of the major companies in the Vietnamese Paper Packaging market include Song Lam Trading & Packaging Production, Tetra Pak International SA, Hanh Packaging Co. Ltd, Oji Interpack Vietnam Co. Ltd, Ltd., and Khang Thanh Co., Ltd, among others. These influential players with a noticeable share in the market concentrate on expanding their customer base across the region. Acquisitions, partnerships with industry participants, and new product/service rollouts have been the key competitive strategies exhibited by the vendors in the market. Some of the recent developments in the market are:
- December 2020 - Rengo Co. Ltd has announced its joint venture in Thailand, Thai Containers Group Co. Ltd (TCG) acquired 94.11% of the shares in Bien Hoa Packaging Joint Stock Company, a corrugated packaging and folding carton manufacturer located near Ho Chi Minh, Vietnam, through TCG Solutions Pte. Ltd, TCG’s subsidiary. The group is expected to have six corrugated packaging plants and two folding carton plants in Vietnam through the acquisition.
- November 2020 - Oji Holdings Corporation has announced a new corrugated container plant in the southern province of Dong Nai, Vietnam. This new plant will be 80,000 square meters and the 34th corrugated container plant in Southeast Asia. The company already operates five corrugated plants in Vietnam with three in the north and two in the south and will expand the business with the third plant in the south.
Reasons to Purchase this report:
- The market estimate (ME) sheet in Excel format
- 3 months of analyst support
Read the full report: https://www.reportlinker.com/p06129761/?utm_source=GNW
ReportLinker is an award-winning market research solution. Reportlinker finds and organizes the latest industry data so you get all the market research you need - instantly, in one place.
CONTACT: Clare: email@example.com US: (339)-368-6001 Intl: +1 339-368-6001