Demand for Tobacco Packaging To Soar in China in Future

Geographically, the tobacco packaging market will exhibit the fastest growth in the Asia-Pacific region in the coming years.

The most-important factors helping in the growth of the tobacco packaging market are the rising demand for tobacco products and increasing popularity of premium tobacco products. As a result, the revenue generated from the sale of packaging materials used on tobacco products is expected to increase from $19,134.6 million in 2019 at a CAGR of 3.7% during 2020–2030. A wide range of tobacco products are consumed around the world, including cigarettes, cigars, chewing tobacco (called gutkha in India), and bidis.

Thus, the key reason behind the growth of the tobacco packaging market is the rising usage of tobacco products. Nicotine, the key chemical in tobacco leaves, is a mood-altering and psychoactive compound, which fires up the dopamine receptors in the brain. The release of dopamine causes happiness, a feeling the body and the mind can never get enough of. Thus, with the increasing stress level across the globe due to work pressure, family pressure, peer pressure, money issues, and general depression, more and more people are turning to tobacco and other happiness-causing substances.

In addition, the demand for premium tobacco products, including smokeless tobacco, cigars, shishas, and dried tobacco, is growing, especially in emerging economies. They are rapidly becoming popular among the youth, men and women alike, as it is considered more stylish and ‘cool’ to use such products over conventional chewing tobacco and cigarettes. Moreover, many bars and pubs in countries like India and China offer flavored shishas, which attract youths in large numbers. Plus, the hookahs (the actual smoking apparatus) available at pubs are colored vividly and carry eye-catching designs.

Primary and secondary are the bifurcations of the tobacco packaging market under the packaging type segment. Of these, the secondary category generated the higher revenue during the historical period (2014–2019) because of the higher requirement for this level of packaging. Secondary packaging holds the individual units of tobacco products, such as cigarette sticks and pouches of chewing tobacco, in place, which is why it is required in higher amounts. Moreover, this packaging often carries the brand logo and information, which is why it also acts as an important promotional tool.

On the basis of material, the market is divided into paper, plastics, wood, and metals. Among these, in 2019, the paper category dominated the tobacco packaging market owing to the high-volume requirement for paper for manufacturing cigarettes, the most popular tobacco product in the world. Here, paper is used to hold the rolled-up tobacco leaves tightly together, so they form the characteristic cigarette sticks. According to the World Health Organization (WHO), the more-than 6 trillion cigarettes produced in 2019 were smoked by just 1 billion people!

Currently, the highest demand for tobacco packaging materials is witnessed in Asia-Pacific (APAC), simply because it is the largest tobacco consumer in the world. As per the WHO, China was home to 300 million, or one-third of the world’s tobacco smokers in 2019. Additionally, China National Tobacco Corporation is responsible for almost one-third of the global cigarette manufacturing, which creates a high demand for materials for packaging the leaves. To fulfil the increasing demand for such products, advancements are being brought about in the packaging materials and the packaging technology.

In 2019, the tobacco packaging market was consolidated, with a handful of major companies holding the majority of the share. Key players in the industry are Amcor Plc, ITC Limited, International Paper Company, Mondi Plc, Smurfit Kappa Group Plc, Packaging Corporation of America, Sonoco Products Company, Winkel Verpackungen GmbH, WestRock Company, Bihlmaier GmbH, Duke Packaging, TFP Sp. z o. o., Leser GmbH, Emenac Packaging, and Stora Enso Oyj. To get ahead of their competitors, these companies are engaging in product launches, mergers and acquisitions, and facility expansions.

Thus, the rising demand for tobacco products is leading to a high-volume requirement for the associated packaging materials.

Aryan Kumar

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