FMI’ Analyst view: “Fast Food Unboxed: A Look at Trends and Technologies in Packaging”
The global fast food containers market reached US$ 47.91 billion in 2022 and is likely to get a valuation of US$ 50.45 billion in 2023. With increasing usage across sectors such as hotels, restaurants, retail foods chains, and canteens, the overall fast food container sales are slated to capture a CAGR of 5.3%, totaling US$ 84.56 billion by 2033.
The sales of the boxes by product type are anticipated to bolster, with the top 3 countries estimated to hold around 35 to 40% of the market by the end of 2023. Similarly, based on material, the paper & paperboard segment is estimated to create an incremental opportunity of US$ 23.5 billion between 2023 and 2033.
The fast food containers industry currently forms around 13 to 15% of the food packaging market, which stood at US$ 319 billion in 2022.
Fast food containers are packaging made from paper, glass, plastic, metal, etc. These containers are increasingly used to store and pack different food products, especially takeaway ones. They help in preserving food products as well as protecting them from contamination.
Increasing consumer spending on fast foods, rapid penetration of online food platforms, and robust growth of the food service industry are expected to boost the development of the fast food containers market during the assessment period.
Key Trends Driving the Global Fast Food Containers Market
Increasing Demand for Convenient Food Packaging Solutions Boosting Sales
The food service industry is a volatile industry with changing consumer tastes. Over the years, demand for convenient & packed food has been increasing at a robust pace as it can be served as a quick meal, and the time spent in the kitchen is saved.
Owing to the increased consumption of convenient and packed foods, the need for packaging, which is easy to store and carry and enables immediate consumption, is also growing. Fast food containers serve as secure packaging, are easy to handle, and can help in primary consumption. Products like boxes, clamshells, cans, etc., could be carried easily.
The freshness and nutrition of the products can be preserved for a longer time using food containers. The increasing demand for convenient & disposable packaging may continue to fuel the sales of fast food containers.
Growing Popularity of Paper-based Fast Food Containers Boosting Growth in India
As per FMI, India’s fast food containers market is expected to record a robust CAGR of 7.0% between 2023 and 2033, reaching a valuation of US$ 5.46 billion by 2033. Future Market Insights says, growth in the market is driven by the rapid expansion of the paper industry, growing demand for eco-friendly packaging to reduce pollution, and increasing consumer spending on fast food products.
Over the years, there has been significant growth in the food packaging industry in India. The reason for this is the availability of the packaging raw materials like paper & paperboard and others at lower costs. According to the Indian Paper Manufacturers Association (IPMA), the Indian industry is a rapidly growing market for paper & paperboard and has an annual turnover of around US$ 9.0 billion.
Due to innovative technology, paper & paperboard are used in the packaging industry. As paper & paperboard is the top material in the fast food container industry, the growing paper & paperboard industry is expected to increase the production of paper & paperboard packaging. It is projected to drive the fast food container market in India.
Increased Spending on Packed Food Products Propelling Sales in the United States
The United States fast food containers market is estimated to record a CAGR of 5% during the forecast period, creating an incremental opportunity of US$ 6.41 billion by 2033. Consumers in the United States are more inclined toward packed food products. Factors such as increased shelf life of the packed products and consumer preference for the packed food products augment the sale of fast food containers.
According to the data provided by the Plastics Industry Association, a subsequent amount of packaging is rigid in the global packaging industry, for instance, plastic bottles or food containers. Thus, rigid packaging holds a high rate in the packaging industry and is expected to increase owing to the increasing fast food packaging in countries like the United States.
Similarly, the presence of leading chains such as Burger King, Subway, Starbucks, and others that sell a huge quantity of food daily is expected to boost the sales of food containers across the United States during the projected period.
Key players operating in the fast food containers market focus on increasing their sales and revenues by expanding their capacities and developing eco-friendly products. They are adopting strategies such as new product launches, mergers, acquisitions, partnerships, collaborations, and the establishment of new production facilities to expand their global footprint.
Huhtamaki, International Paper Company, and Graphic Packaging are Some Giants Keeping Fast Food & Sustainability Together
The popularity of fast food around the globe has necessitated the need for packaging that is affordable, sustainable, and, above all, easy to produce on a mass scale. Leading packaging companies have opened new units specifically making fast food packaging, especially in containers. Huhtamaki, one of the leading packaging companies globally, is experimenting with different raw materials. For instance, it is extensively using smooth molded fiber.
Sustainability is another key focus area of Huhtamaki as end-user preference for eco-friendly packaging materials continues to grow. The company is revamping its fast food container solutions to ensure its clients, such as McDonald’s, Starbucks, and Unilever, can deliver on their commitment to sustainability.
Huhtamaki’s site in Germany is switching from plastics to smooth molded fiber products as part of its greater commitment toward sustainability. The company has a goal of replacing 2,000 tons of plastics with fiber. It is also focusing on boosting its production facilities.
- For instance, its automated manufacturing facility in Germany can produce up to 3.5 billion fiber products annually.
The company recently (2021) launched over 100 products for food and drink on the go to address the changing patterns of consumer behavior and growing demand for sustainable packaging. The new products are specially designed to serve the needs of home delivery and takeaway foodservice operators in the United Kingdom.
Most fast-food container companies are boosting their brand image by embracing innovation. They attend various events, conferences, and award shows to showcase their products. For instance, Huhtamaki was recognized for ‘Excellence in Packaging’ at the 6th edition of the Economic Times Polymer Awards.
Similarly, International Paper Company invests heavily in brand promotion through corporate social responsibility (CSR) initiatives. The company’s strategy is recycling and using eco-friendly raw materials in its manufacturing process.
- For instance, International Paper Company partnered with the Paper and Packaging Board to boost residential recycling rates. The initiative aims to create a favorable marketplace for manufacturers and e-commerce companies to use recycled boxes. As part of its sustainability initiatives, the organization donated over 1,000 trees in North America.
To sustainability initiatives, fast food container packaging companies are also focusing on mergers & acquisitions to consolidate their position.
- For instance, Graphic Packaging Holding Company announced in December 2020 that it may continue the monetization process of International Paper’s Minority Partnership.
Keeping up with its competitors, who are aggressively focusing on recycling, Graphic Packaging announced the launch of a sustainable packaging system manufactured using fiber-based packaging. This new system eliminates the need for plastic rings and shrink wrap.