China continues BOPP film capacity expansion

By Joseph James Whitworth

- Last updated on GMT

Data comes from PCI Films Consulting's World BOPP Film Market Trends to 2019
Data comes from PCI Films Consulting's World BOPP Film Market Trends to 2019

Related tags Bopp film Compound annual growth rate Bopp

China has accounted for 57% of all installations of bi-oriented polypropylene (BOPP) film extrusion capacity globally since 2000, according to PCI Films Consulting.

A report on market trends until 2019 found the Chinese BOPP film industry has expanded 10-fold, four million tonnes of capacity despite domestic consumption only growing by 2.8 million tonnes in the same period.

Exports have only expanded by 100,000 tonnes which PCI said means the industry is suffering from low margins and underutilised capacity.

It added there are opportunities to source large quantities of commodity film from some Chinese producers, with one soon being able to supply the US market’s annual needs twice over. However, commercial terms may make doing business practically impossible.

It is because of this uncertainty in the long term security of some Chinese sources that PCI strongly recommended using local sourcing partners to help reduce the risks.

In the last five years average compound annual growth rate (CAGR) growth in global consumption of BOPP films has averaged 6.2%.

Simon King, PCI’s managing director, said: “While demand growth in mature BOPP film markets, such as Western Europe, North America and Japan has been lacklustre, demand in emerging markets such as China and India continues to grow strongly while new markets, such as Vietnam and Myanmar, have seen rapid expansion in their domestic flexible packaging industries.”

PCI said some factors in the BOPP film market were growth in convenience foods such as fruit and vegetables, snacks and confectionery and substitution of other flexible packaging materials such as BOPET and BOPA films, label papers and aluminium foils.

It added investment in new converting and packaging equipment allowing it to be used in more applications and environmental legislation pushing rigid packaging formats towards flexible packaging were other factors.

Related topics Processing & packaging

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