Report on the state of packaging - December 2022
The quarterly observatory of the packaging sector: updated situation at December 2022. General economic situation; general analysis of manufacturing activity in 2022; final data on the packaging industry 2021.
Barbara Iascone
This report summarises the trend of sectors of the manufacturing industry where the consumption of packaging is most intense, subdivided into the food and non-food macro-areas. The general outlines of the evolution of the manufacturing sectors are drawn from the sectoral analyses developed by trade associations, ISTAT, the database of the Italian Packaging Institute and Prometeia. As has been recognised for some years now, the packaging sector is closely linked to the manufacturing activity trend, especially those trends and those sectors with a high use of packaging, such as food and beverage, consumer goods, pharmaceuticals, cosmetics, etc.
The data used for drawing up the report are taken from the Italian Packaging Institute database.
FOOD & BEVERAGE
On the basis of an analysis of the 11-month ISTAT data, the food sector, the area with the largest use of packaging, recorded +1.4%. Foreign trade shows a positive trend, with exports growing by +3.9% and imports by +6.3%. The packaged food sector was boosted by vegetable preserves, the production of which grew by +3.6%. Other growth sectors were packaged pasta (around +2%) and biscuits, crisp toasts and packaged pastries (+1%). The beverage industry production grew in 2022 by +2.8%; according to data referring always to the first 11 months of the year, imports grew by more than 9% and exports by around +1.5%. Production was positive for both alcohol-free drinks (+3%) and alcoholic drinks (+6%). Within this sector, spirits grew most with +15%, followed by +3.6% for beers. The production of wines, instead, fell.
NON FOOD
With regards to the non-food industry, always with reference to the manufacturing areas where use of packaging is greater, the cosmetics and pharmaceutical sectors were among the most important, both growing in 2022. On the basis of the latest forecasts developed by the Centro Studi di Cosmetica Italia (Italian Cosmetic Research Centre), the cosmetics sector closed 2022 decidedly positively, with a growth of +10.7%, while the forecast for 2022 against 2021 with regards to exports is over +15%. The pharmaceutical sector should, instead, close 2022 at around +5%. With regards to the non-food sector, mention should be made of the positive trend in the construction materials industry, which will grow by around 7%, and in the fashion sector, with +6%.
GENERAL ECONOMIC SITUATION
On the basis of analyses carried out by ISTAT (Italian National Statistics Institute), 2022 should close with a growing GDP, reaching around +3.9%. This increase has certainly been underpinned by domestic demand which should record an annual +4.2%, against foreign demand which has slightly dropped, by -0.5%, and movement in inventories that should provide a partial contribution to the growth in internal demand, of +0.2%. Household consumption and ISP* also confirm the healthy state of the Italian GDP, recording +3.2%. For 2022, investments also follow the positive trend of the national economy, arriving at closing 2022 with +10%. The positive trend will be accompanied also by a growth in employment, recording an annual figure of +4.3%. On the basis of the latest Prometeia data available (October 2022), the trend in the manufacturing sector should close the year with an increase of +2.1% (turnover at constant prices). The rise, due to inflation, which will grow by 11.6%, accompanied by excessive energy increases, will take the gain in turnover at current prices to as much as +25.2%.
The positive results of 2022 will be slightly dampened by the slowdown which characterised the last months of the year and which, presumably, will continue into 2023, risking the recording of contractions in the year just begun. Taking a general look at the trend of various manufacturing sectors, it appears that the fashion sector is the best performing area thanks to the recovery of people’s social lives and tourism. Cars and motorbikes are, instead, still facing some challenges, due to a slow restart in demand.
The international political situation is still of great concern, with all the relative economic implications. The Russia-Ukraine conflict has led to a sharp increase in energy costs and a serious scarcity in the supply of raw materials, which has implied unprecedented increases in production costs, with repercussions on the whole supply chain.
An analysis, therefore, of the entire period of the year reveals a division into two trends: in the first part of the year the manufacturing sector managed to fully recuperate the losses post-covid and began to find a good pace of recovery; in the second part, there was, however, a reversal in the trend caused by the international geopolitical situation.
*ISP. Private social institutions serving families, which include private producers of goods and services not for sale, such as cultural and sports associations, foundations, political parties, trade unions and religious bodies. The economic results of this sector are not presented autonomously; they are combined with those of the Household sector.
The packaging sector
In 2021, the packaging sector in Italy represented 3.4% of the turnover of the manufacturing industry, and 2% of GDP.
Production (including MSW bags) expressed in weight was 18,189,000 tonnes, marking a growth of +7% compared to 2020. Turnover amounted to 35,216 million euros, that is, +5.9% on the previous year. Foreign trade also had a positive trend, both for exports and for imports, respectively up by 5.9% and +17.2%. The trade balance remains positive with 565 t/000 more packaging exported than what we import, but with a fall in the same balance, of 25%. The main channel for Italian exports remains the EU.
The correlation between the packaging sector trend and manufacturing activity remains intact, even though for 2021 the growth in manufacturing activity was higher than that for the packaging industry. With regards to the positive trend in the production of packaging, we believe that the trend of movements in inventories had a strong influence. Being unable to monitor these quantities, we can only surmise the flow, with the result that any use deriving from such an analysis is, therefore, somewhat theoretical.
In the 2020-21 two-year period, given the anomalous trend of many user sectors, inventories were important for facing market demand. In 2020, to cope with increases in demand for products, especially in the packaged food sector, both packaging producer companies and user companies had to draw on their inventories, which in 2021 were promptly restored, in this way contributing to the +7% in the total production of packaging.
This phenomenon related, in particular, to certain types of packaging, such as glass and metals.
| 2019 | 2020 | var. 20/19 | 2021 | var. 21/20 | Ipotesi 2022 | var. 22/21 | |
|---|---|---|---|---|---|---|---|
| Turnover | 33.976 | 33.256 | -2,10% | 34.718 | 4,40% | 35.413 | 2,00% |
| Production | 16.906 | 17.002 | 0,60% | 18.189 | 7,00% | 18.371 | 1,00% |
| Export | 2.922 | 2.846 | -2,60% | 2.982 | 4,80% | 2.985 | 0,10% |
| Import | 2.139 | 2.091 | -2,20% | 2.327 | 11,30% | 2.613 | 12,30% |
| Apparent use | 16.123 | 16.247 | 0,80% | 17.534 | 7,90% | 17.999 | 2,70% |
Analysing the different types of packaging, the following elements emerge:
- In 2021, the sector of steel packages broadly confirms the positive trend already seen in 2020. The year ended with a growth in production of 5% compared to 2020, confirmed by a positive trend in exports which rose by 3%. Imports show a decidedly positive trend, closing with +14.6%. Apparent use grew by +7.3%. It should be considered, however, that this figure does not take account of the effect of stocks which we believe underwent significant movements between 2020 and 2021.
- The production of aluminium packaging only, excluding, therefore, aluminium sheet used for converters, was 152,500 tonnes in 2021, taking the trend to +29.8% compared to 2020. Analysing the single categories of aluminium packaging, it emerges that containers grew by 57.9%, capsules and closures by 38.5%, food cans by 28.2%. Fine sheet aluminium grew by 16.8%, while the only sector to record a fall, of -2.8%, was that relating to the “other” heading, which includes fine sheet aluminium for closing yoghurt tubs, tubes, and wine bottle capsules.
- Again in 2021, as in 2020, the production of plastic packaging closed with a slight fall with regards to the quantity expressed in tonnes (-1.5%), taking the figure to around 2,965 t/000.
- For the flexible sector for converters, after a slight fall recorded in 2020, in 2021 the trend became positive again, with a production arriving at over 415,000 tonnes, with a growth rate of +4.1%. Exports represent 52% of the population and are slightly down, at -1,6%. Imports remain constant, with very low volumes.
- In 2021, the production of cellulose packaging expressed in tonnes recorded a growth of 10.5% against 2020, underlining the state of excellent health enjoyed by the sector. The sector trends are all positive, with imports growing by over 14% and exports +10.4%.
- For the rigid laminated, predominantly paper packaging area, there was a return to stability. This type of packaging saw a growth trend in 2020, and the data confirms a stable production of 147,000 tonnes and a turnover hovering at around 482 million euros.
- Glass packaging showed a decisive trend reversal, leading production expressed in tonnes to grow by 5.8%. Foreign trade followed the production trend, recording an increase of +18.1% for imports and +13.5% for exports.
- With regards to the wood packaging supply chain, in 2021 production expressed in tonnes grew by +11.6%, taking the figure to 3,182 t/000.
First full-year forecasts Forecasts
relating to the sector for 2022 hover at around +1%: it is a clearly very prudent estimate due to the economic problems that characterised the year. There should be a more brilliant growth in the subsequent years, with an average annual growth of +1.2%. In 2025, tonnes of packaging produced in Italy should exceed 19,600 t/000.
With regards to the prices of raw materials used to produce packaging, they were indiscriminately characterized by upward trends for the first part of the year, to then fall after the summer and stabilize at the end of the year. The prices reached at the ed of the year are lower than those in January, with the exception of paper, the prices for which, however, increased.
