The annual survey of buyers, carried out by the Packaging Machinery Manufacturers Institute (PMMI), provides a key guide to the trends affecting equipment purchasing. Key factors, such as high energy and manufacturing costs, intensified competition at home, and the lure of high-growth emerging markets overseas, are affecting purchasing decisions, the PMMI stated. The study forecasts that packaging machinery sales will remain flat in 2007 at an estimated value of $6.266bn. The downturn follows five consecutive years of growth in US domestic demand for packaging machinery. The food and beverage sector accounts for 59 percent of the annual purchases from the PMMI's members. The PMMI survey forecasts that packaging machinery purchases in the beverages sector will fall to $1,141m, a drop of between 3 to 5 percent compared to last year. Meanwhile food manufacturers plan to increase their spending to $2,558bn, a rise of about 3 percent compared to 2006. Capacity rates remain comfortably above the 80 percent range for food plants and in the overall non-durables segment, the PMMI noted. While the purchasing plans study indicates machinery sales will level off in 2007, the end users surveyed indicated several market specific factors that were affecting their decisions. They are increasingly focused on improving packaging line efficiency and productivity as US companies look to squeeze more savings out of their manufacturing operations, the PMMI stated. Of the study's respondents who are planning to purchase packaging machinery this year, 45 percent said the most important reason for the investment will be to improve the efficiency or productivity of their existing packaging operations. This was the most frequently cited reason for purchasing packaging machinery in 2007 for each of the major market segments covered in the study. End users are also demanding additional flexibility in machinery to handle a widening range of packaging requirements, including more changeovers, with a minimum of downtime. "As companies increasingly market products to more finely fragmented demographics and/or lifestyles, packagers are being asked to accommodate a growing variety of package sizes, shapes, and configurations on their lines," the PMMI stated. "The issue of machinery flexibility to handle the necessary changeovers efficiently, with a minimum of downtime, will continue to be a primary concern for many customers this year." Escalating concerns about product security and tracking will strongly influence new investment in machinery, the PMM stated. The association also cited the increasing use of packaging as a competitive brand marker as driving demand. The PMMI expects the growing demand for convenience packaging as continuing to influence purchasing decisions in 2007. Another trend is the shifting of production to lower-cost overseas markets. A host of US consumer product companies are earmarking significant capital funds for expansion in emerging markets such as China, India, and Brazil - and consequently, less for more mature markets such as North America and Western Europe, the PMMI stated. About 31.4 percent of respondents plan to purchase some quantity of used or rebuilt packaging machinery in 2007, largely the same as in previous years. However, as a share of total packaging machinery dollar expenditures, used and rebuilts are expected to fall to 4.3 percent this year from 6.2 percent in 2006. The price factor advantage of used and rebuilt machinery appears to be diminished to a certain extent due to the general cash flush positions of many of the large companies. Among the participants whose company/plant will order rebuilt machines in 2007, 31.6 percent intend to buy them exclusively from used equipment dealers, 16.8 percent exclusively from machinery manufacturers, and 51.6 percent from either or both sources. Meanwhile robotics continues to grow in importance in packaging operations. Usage continues to increase in the food, beverage, pharmaceuticals, paper products, printing, and other consumer product industries. According to the findings of a study, palletizing will continue to account for the largest share of robotic usage in packaging operations in 2007, followed by case and tray packing, and then by cartoning applications. About a third of the respondents who will buy packaging machinery configured with robotics this year - mentioned categories of use that include dry- and liquid-product filling, coding, labeling, conveying, bagging, and form, fill and seal operations. About 43.9 per cent of the sample's respondents reported that their companies were currently using contract packagers for at least some portion of their packaging requirements. The figure compares to 40.7 percent in 2005 and 37.7 percent in 2006. US demand for machinery manufactured outside North America represented about 29 percent of total US packaging machinery expenditures in 2006. About 9.2 percent of the respondents indicated they would finance at least some portion of their packaging machinery acquisitions in 2007, down from 11.2 percent in 2006, and 12.3 percent in 2005. "While leasing arrangements are widely available to companies and plants acquiring packaging machinery, their use of leases appears to have reached a plateau of late," the PMMI stated. The low interest rates currently available in the US have made purchases more attractive. Of the sample's 468 respondents, 71.8 percent said that their company, division or plant facility would order some quantity of packaging machinery in 2007, down from 78.5 percent in 2006 and 88.4 percent in 2005. The respondents were collectively responsible for 7,160 packaging lines in 1,073 plants located throughout all key segments of the US market. About 40 percent of all respondents plan to spend less for packaging machinery this year, while 34 percent intend to invest more. Another 26 percent indicated they would spend roughly the same amount as in 2006. "Simply put, a larger percentage of respondents this year plan to shift their annual expenditures for packaging machinery - either up or down - than in any of the previous years reported in the study," the PMMI stated.