Packaging, a sector following economic catching up

The article looks at the status of the packaging sector in the CEEC.

The packaging sector is becoming increasingly important in the CEEC, following the development of the sectors which are its main consumers: the agrofood industry and mass retailing, together accounting for more than 50% of the sector’s demand, but also cosmetics and the pharmaceutical industry. Production quality has rapidly adapted to the requirements of end users and European standards are already widely applied. The multinationals have, of course, contributed to this dynamic and are well established in the region. Poland is reported to have attracted nearly USD 1.3 bn of FDI in this sector, where many companies with local capital remain active and competitive.

The CEEC’s trade balance is slightly negative. In 2002, imports of packaging products exceeded USD 2 bn. Plastic packaging accounted for 42% of the total, followed by paper and cardboard (30.5%), glass (10%), steel (8.6%), aluminium (4.5%) and wood (3.6%). Exports reached USD 1.9 bn. Plastic packaging products are also the main exports and account for 35.4% of the total exports, followed by paper and cardboard (19.8%), wood (17.7%), glass (11%), aluminium (8.1%) and steel (7.7%). Poland, Hungary and the Czech Republic are the main trading players in the region.

The production and consumption of paper and cardboard packaging still dominate the market and this is probably the most developed sub-sector. In 2002, the CEEC’s imports of paper and cardboard packaging goods amounted to USD 614M. Poland is the leading importer (31.3%), followed by Hungary (17.1%) and the Czech Republic (16.8%). Exports amounted to USD 375M. The main supplying countries are Poland (33.9%), the Czech Republic (26.2%) and Slovakia (9.7%).

Plastic packaging is really taking off, and its use is constantly increasing. This is the market segment which has experienced the strongest growth over the last few years. Imports of plastic packaging reached nearly USD 850M in 2002. The main consumers are Poland (32.6%), the Czech Republic (21%) and Hungary (14%). On the export side, Poland also ranks first with a 36% share of the USD 672 M exported, followed by the Czech Republic (20%) and Hungary (18.8 %).

Both production and consumption of metal packaging are falling in the majority of the candidate countries. Trade in aluminium packaging exhibits a relatively large surplus with USD 154M exported and USD 92M imported. Polish sales represent 57 % of the regional total. For steel, USD 173 M were imported. Poland accounts for 28 %, followed by Hungary (18 %) and Slovenia (16%). Exports of metal packaging are valued at USD 146M with 2 main supplying countries: Poland (28.4%) and the Czech Republic (27%).

Glass packaging products are used above all for the beer market, which provides an important outlet in the CEEC. Production remains limited to one player per country and the trade balance is slightly in surplus (USD 210M exported against USD 206M imported), Poland (32.8%) and the Czech Republic (23.4%) being the main exporting countries.

Wood is abundant in the region and this industry is a traditional sector in many of those countries. Some of them specialise in pallets (Slovenia and Latvia in particular) which are exported to the EU. But, on the whole, the use of wood packaging remains slight in the CEEC.

Local production of packaging machines is very low, except in the Czech Republic. The majority of the machines used are imported, mainly from Germany and Italy.

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