Packaging Foams Market Trends

Growth Drivers

• Expanding e-commerce sector: Growing e-commerce is a significant driver in the packaging foams market. the growing engagement in online purchasing among the population demands durable and protective packaging to ensure the safe delivery of products. For instance, the skyrocketing e-commerce sales during the COVID-19 pandemic led to higher demand for packaging foams, particularly in cushioning materials to protect fragile items such as electronics, and glassware. Furthermore, in November 2022, Alibaba’s Singles’ Day sales exceeded USD 84.5 billion, significantly boosting the demand for packaging solutions, including foam materials.

• Focus on sustainable eco-friendly packaging: The growing focus on sustainability and eco-friendly packaging is reshaping the packaging foams market as both consumers and businesses seek to reduce environmental damage. Companies are increasingly turning to biodegradable, recyclable, and bio-based foam materials to meet regulatory requirements. For instance, according to FSSAI August 2011 report, containers made of plastic materials, used as appliances or receptacles for packing or storing whether partly or wholly, food articles, should conform to the Indian Standards Specification. This shift is driving the global packaging foams market and encouraging innovations majorly in to develop biodegradable foam packaging for fragile and perishable food products, that provide both environmental protection and benefits. For instance, in April 2020, JSP Corporation launched polymer foam known as Arpro 35 Ocean made with 15% recycled maritime waste recovered from fishing nets and ropes.

Challenges

• Rising preference for alternative packaging materials: The rising preference for alternative packaging materials, such as paper-based packaging, poses a challenge to the packaging foam industry. Many companies are shifting towards paper packing due to its biodegradable properties and lower environmental impact. This trend is driven by sustainability goals and regulatory pressure, reducing the demand for traditional foam-based packaging. This is further compelling the existing companies to develop more sustainable packaging foam to remain competitive.   

• Volatility in raw materials prices: This presents a significant challenge for the industry. The production of foam materials, such as polyurethane and polystyrene, depends severely on petrochemical derivatives. These derivatives undergo several price fluctuations. This increases production costs, making it difficult for the manufacturers to maintain stable pricing of their products. As a result, raw material price volatility is impacting the industry to a certain range.