VOLUME OF DOMESTIC PRODUCTION
In 2016, 114.6 thousand tons of boxes and 197.6 thousand tons of non-corrugated cartons were produced in Russia. 312.2 thousand tons of consumer packaging from folding boxboard (FBB) total were produced in 2016.
Growth in output of consumer packaging from non-corrugated board amounted to 1.5% in 2016. The share of cartons in the total production volume increased from 59.1% in 2012 to 63.3% in 2016.
In the total volume of FBB packaging, the Central Federal District is the leader with the share of 50.5%. The shares of federal districts in overall production differ depending on the type of packaging. Whereas the share of the Central Federal District in production of cartons amounted to 70.3% in 2016, its share in box production in the same time period was significantly lower and equalled 16.6%. At the same time, the shares of the Northwestern Federal District in carton production and box production equalled 27.2 and 33.7% respectively.
FBB CONSUMPTION VOLUMES
The volume of FBB packaging in 2016 amounted to around 312 thousand tons (consumption of packaging materials from corrugated board and polyethylene films not included).
In terms of volumes of board packaging production, 2 largest companies can be identified: “Tetra Pak” CJSC (packaging material for liquid foods) and “Amcor Tobacco Packaging Novgorod” LLC (hard packaging for cigarettes) – together, these companies consume more than 100 thousand tons of board per year.
The segmentation of other packaging manufacturers in terms of board consumption volumes is shown in Figure 3. Segmentation was based on the information in the databases of companies in the pulp and paper industry as well as data received in a packaging manufacturer survey.
In 2016, imports of FBB packaging into Russia amounted to 43.2 thousand tons. Compared with 2015, imports declined by 10.4% in physical terms and by 7.5% in monetary terms.
In 2012–2013, the dynamics of FBB packaging imports demonstrated different trends. In 2012, the volume of consumer board packaging increased by 11.8% in value terms, reaching $ 217.5 million, and grew by 10.4% in volume terms, reaching 76.3 thousand tons. In 2013, however, growth in imports in monetary terms equalled 3.7% (to $ 225.5 million), whereas in physical terms their volume declined. In 2014–2016 the dynamics of board imports in volume and value terms were similar.
Russia was importing FBB packaging from 65 countries in 2016. Around 45% of board packaging was supplied from three countries – Germany, Lithuania, and South Korea. The total volume of supplies from these three countries amounted to 19.4 thousand tons in physical terms. The volume of board packaging imports from other countries varies from 0.5 to 4.5 thousand tons per country. These countries include China, Poland, Ukraine, Latvia, the Netherlands, Slovakia, Sweden, and Turkey.
The volume of imports of Ukrainian packaging in 2016 plummeted by 83.2% against 2012.
In 2016, 43.2 thousand tons of board packaging for food products (including liquid foods), industrial products, perfumes and cosmetics, household chemicals and other goods were imported into the Russian Federation.
“SIG Combibloc GmbH & Co. KG” (“SIG Holding AG”, Switzerland) was the leader in import volumes, having accounted for 16.2% of the total volume. The company was importing cardboard box cutouts.
The Slovak “Grafobal Group” was second with the share of 6.3% in the total volume, producing board packaging for foods and industrial products.
The third position was held by another manufacturer of food packaging – the Korean “Sambo A-Pack Сo. Ltd”, with the share of 6.3% in the total volume of imports.
In the structure of imports of FBB packaging by fields of application, the largest shares in 2016 were occupied by food product packaging (49.8% of the total volume of imports) and non-food product packaging (27.5%). In 2016, there was a decline in volumes of imports of packaging for all types of goods, except food product packaging. It should be noted that imports of packaging for household chemistry resumed in 2016.
In 2013, exports of consumer packaging from folding boxboard was remaining approximately at the level of 2012. In 2014, as a result of the devaluation of the ruble, exports of board packaging increased by 22.5% and reached the level of 6.5 thousand tons. The unfavourable economic conditions, which negatively affected paperboard manufacturers, led to a reduction of exports by 9.2% to 5.9 thousand tons in 2015. In 2016, exports began to grow again, reaching its maximum level throughout the time period in question – 9.4 thousand tons.
The volume of FBB packaging exports is relatively low – imports exceed exports by dozens of times. In addition, exports include transit cargo as well as re-exports.
In monetary terms, the dynamics of FBB packaging exports have demonstrated slightly different trends. In 2013, growth in export volumes for this product category equalled 13.9%, exports reaching $ 31.3 million, whereas in physical terms the increase amounted to only 0.8%. In 2014, growth in the volume of exports in monetary terms reached 15.7%, whereas in physical terms exports increased by 22.5%. In 2015, exports of board packaging in value terms dropped by 17%, while in volume terms there was an increase of 9.2%. In 2016, exports increased by 60.4 and 23.3% in volume and value terms respectively. Said dynamics indicate that growth in volumes of board packaging supplies from Russia occurred as a result of the decreased value thereof.
Around 27.5% in the volume of board packaging exports in physical terms in 2016 fell on “Amcor Tobacco Packaging Novgorod”. The company exports hard cigarette packets into different countries.
“Elopak” CJSC was second in export volumes with the share of 12.8%. The company exports semi-finished cardboard boxes into Italy, Mongolia, Turkmenistan, and Finland.
“AR Karton MSK” LLC was third in the total volume of board packaging exports, accounting for the share of 9.2%. The enterprise supplies hard packaging for cigarette packs to Poland, Lithuania, Ukraine and Serbia.
In 2016, the largest share in the structure of FBB packaging exports by fields of application amounted to around 61.3% and was accounted for by packaging for tobacco products.
Food product packaging was second in export volumes, its share amounting to 25.6%, whereas packaging for non-food products was third with the share of 12.9%.
All in all, the market of consumer packaging has stabilised in 2016, even though there have been some changes in its structure. Through import substitution programmes, growth in domestic production was achieved, although a decline in import volumes and increased exports resulted in a slight decrease in the total volume of the FBB packaging market.
According to forecasts, a 1.5% increase in GDP and 2.7% growth in industrial production are to be expected in 2017. In addition, a recovery of purchasing power and solvent demand as a result of increased wages and real disposable household incomes (+0.5%) is expected.
The aforementioned factors will positively affect the main industries that consume FBB packaging. According to forecasts, the total volume of the consumer FBB packaging market may grow by 0.8–1%, reaching around 350 thousand tons. At the same time, the share of packaging from board of Russian production will continue to increase, whereas the share of packaging from imported board may decline by 5–7% to 40 thousand tons in 2017.
The following factors serve as preconditions for the realisation of this forecast:
* dynamics of market changes having begun in 2016;
* implementation of import substitution programmes;
* an increase in export volumes by the main industries using consumer packaging from folding boxboard.
Research Company “Abercade”