Summary

Market Overview
Indonesia Flexible Packaging Market reached US$ 4.1 billion in 2022 and is expected to reach US$ 5.9 billion by 2030, growing with a CAGR of 4.8% during the forecast period 2023-2030.
During the forecast period, changing consumer preferences is expected to drive the growth of the Indonesia flexible packaging market. Increasing consumer preference for on-the-go food consumption have contributed to a rise in demand for single-serve and ready-to-eat packaged food products, which is bound to increase demand for flexible packaging solutions from food processing companies.
The rising demand for packaging solutions is leading to increased investment in Indonesia’s plastics industry as companies strive to ensure feedstock output. In September 2022, Toyobo, a Japanese company announced a US$ 72 million investment to build a new polyester packaging film production facility in Pt. Trias Toyobo Astria (TTA), the company’s joint venture with Pt. Trias Sentosa, an Indonesian film producer.
Market Dynamics
Growing Population and Urbanization
Indonesia has a rapidly growing young population and the country is witnessing relentless urbanization due to the strong economic growth over the past decade. Nearly 58% of Indonesians live in urban areas and more than a quarter of its population is under 29 years of age. The country has witnessed major socio-economic changes which have altered lifestyles and consumption habits of its population.
Indonesia’s rapidly growing urban population is fueling the demand for e-commerce services and packaged food and beverage products. It has prompted an increase in demand for flexible packaging solutions from the e-commerce and food and beverage industry. Manufacturers are engaged in capacity expansion with a view to catering to the hypothetical demand over the coming years.
Advances in Manufacturing Technology
Modern manufacturing technologies, such as industrial machinery automation, robotics and computerized quality control, have significantly increased production efficiency in the flexible packaging industry. Advanced manufacturing technology allows for faster turnaround times in producing flexible packaging materials. Shorter production cycles enable manufacturers to meet tight deadlines and respond promptly to the changing needs of customers and industries.
Furthermore, since automation enables high volume production, the economics of scale means that per unit cost of flexible packaging is reduced drastically, making it high competitive against other packaging solutions. Advanced manufacturing technologies also allow for better control over materials and production processes, leading to reduced waste generation.
Volatility in Raw Material Prices
The production of flexible packaging is dependent on various raw materials including plastics, resins, adhesives, paper and aluminium sheets. With the possible exception of some plastics, Indonesia imports a significant amount of raw material required for flexible packaging production. Due to its weak currency, even a small rise in raw material prices is magnified, leading to a considerable erosion of profit margins for manufacturers.
Given the competitive and price sensitive nature of the market, flexible packaging manufacturers are unable or unwilling to pass on rise in production costs to their customers. Small and medium-scale manufacturers are the most vulnerable to the volatility in raw material prices, since they do not have high production volumes or financial reserves to offset erosion of profit margins.
COVID-19 Impact Analysis
The COVID-19 pandemic led to a shift in demand dynamics for the Indonesian market. Due to increasing sanitary concerns, demands for single-use flexible packaging increased significantly over the course of the pandemic. Manufacturers responded to this change by increasing production of sterilized single-used flexible packaging solutions.
However, labor shortages triggered by lockdown measures and supply chain disruptions created shortage of various essential components, leaving many manufacturers unable to scale up production in response to growing demand. Many flexible packaging manufacturers faced financial problems and some even went bankrupt over the course of the pandemic.
Russia-Ukraine War Impact Analysis
Although the ongoing Russia-Ukraine war has not directly impacted the Indonesia flexible packaging market, secondary order effects are likely to create various challenges for market growth over the short and medium term. The volatility in crude oil prices is expected to lead to increased prices for plastics and other feedstock materials, thus leads to increased production costs for manufacturers.
Furthermore, since Russia and Ukraine are both major agriculture commodity exporters, the conflict has led to significant food inflation, with prices of critical crops such as wheat witnessing major increases. Increased prices for packaged food products has led to reduced consumer spending, thus affecting demand for flexible packaging from the food and beverage industry.
Segment Analysis
The Indonesia flexible packaging market is segmented based on material, product, technology, end-user and region.
Traditional Flexible Packaging is Still Preferred in Indonesia
Although there is a growing shift towards sustainable flexible packaging, traditional flexible packaging, mainly made from various types of plastics, is still widely preferred. The materials used in traditional packaging are often more affordable compared to some sustainable alternatives, making them an attractive choice for price-conscious businesses.
The production and supply chain for traditional flexible packaging solutions is well-established in Indonesia. Furthermore, the production technology has matured and companies are highly familiar with all production processes. Traditional flexible packaging materials offer a wide range of properties and capabilities, making them suitable for various products across different industries.
Competitive Landscape
The major players include Amcor plc, Innopack, Berry Indonesia Inc., PT. INDONESIA TOPPAN PRINTING, Plasindo Lestari, PT. Primajaya Eratama, PT. Tunas Alfin Tbk, ePac Flexible Packaging, PT Artec Package Indonesia, PT Dinakara Putra, Flexo Plate Digital, Mondi Group, Sealed Air Corporation, Sonoco Products Company, PT Inkote Indonesia and PT Argha Karya Prima Industry..
Why Purchase the Report?
• To visualize the Indonesia flexible packaging market segmentation based on material, product, technology, end-user and region, as well as understand key commercial assets and players.
• Identify commercial opportunities by analyzing trends and co-development.
• Excel data sheet with numerous data points of Indonesia flexible packaging market-level with all segments.
• PDF report consists of a comprehensive analysis after exhaustive qualitative interviews and an in-depth study.
• Product mapping available as Excel consisting of key products of all the major players.
The Indonesia flexible packaging market report would provide approximately 53 tables, 41 figures and 165 Pages.
Target Audience 2023
• Manufacturers/ Buyers
• Industry Investors/Investment Bankers
• Research Professionals
• Emerging Companies

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