corrugated packaging - overview and prospects

7/29/2019 Corrugated Packaging - Overview and Prospects

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Corrugated PackagingCorrugated PackagingOverview & ProspectsOverview & Prospects

Mr . Har i sh Madan,SnS Containers Pvt. Ltd.

SelaQui, DehradunPast-President, FCBM


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TopicsTopics

Present Status in India.Present Status in India.

Present TechnologyPresent Technology itsits

limitations.limitations.

Why the need for change ?Why the need for change ?

A comparison with ChineseA comparison with Chinese

scenario.scenario.


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Cor ru ga t ed Pack ag ing : Overv iew & Trends

Overv iew

FCBM is t h e apex bo dy o ft h e in d u s t r y b u t h a s o n l y

1 6 0 0 m em b er s, w h i let h e n u m b er o fco r r uga t ed boxu n i t s w i t h in t h eco u n t r y a r e est i m a t e d t o

b e ar o u n d 1 0 ,0 0 0 .


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Present Status in IndiaPresent Status in IndiaIn the last decade (1996In the last decade (1996 2006)2006)

The average number of single facersThe average number of single facers

per company has increased from 1.86per company has increased from 1.86to 2.69to 2.69

Average production per day per singleAverage production per day per single

facer has increased from 1575 Kgs. tofacer has increased from 1575 Kgs. to2724 Kgs.2724 Kgs.

The consumption of 7 ply boxes hasThe consumption of 7 ply boxes has

reduced from 23% to 11%.reduced from 23% to 11%. The consumption of 3 and 5 ply boxesThe consumption of 3 and 5 ply boxes

has increased from 54% to 86%has increased from 54% to 86%


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Present Status in IndiaPresent Status in India

In the last decade (1996In the last decade (1996 2006)2006)

Significant growth is observed inSignificant growth is observed in

consumption of paper above 150 GSM.consumption of paper above 150 GSM.

A significant growth in consumption ofA significant growth in consumption of

paper above 20 BF. We see more andpaper above 20 BF. We see more and

more usage of higher BF paper (28 andmore usage of higher BF paper (28 and

35 BF).35 BF).

A significant growth in high qualityA significant growth in high quality

graphics. At present it is pregraphics. At present it is pre--print butprint but

trend is towards post print.trend is towards post print.


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Present Status in IndiaPresent Status in India

In the last decade, there is aIn the last decade, there is a

significant growth in consumption ofsignificant growth in consumption of

corrugated box incorrugated box in

Processed Food IndustryProcessed Food Industry

Fruits & Vegetables.Fruits & Vegetables. Electronic Industry.Electronic Industry.

Consumer Durables.Consumer Durables.


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Present TechnologyPresent Technology LimitationsLimitations

Single Facer TechnologySingle Facer Technology

Off line Lamination of Single FacerOff line Lamination of Single Facerwith the Top Liner.with the Top Liner.

PrePre--printed Top Liner for Qualityprinted Top Liner for Quality

Graphics.Graphics.Screen Printing of Corrugated Boxes.Screen Printing of Corrugated Boxes.

FlexoFlexo--printing of Corrugated Boards.printing of Corrugated Boards.Majority boxes are RSC with stitchedMajority boxes are RSC with stitched


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Present TechnologyPresent TechnologyLimitationsLimitations

DieDie--cut boxes done on flat bed orcut boxes done on flat bed or

platen punching machines.platen punching machines.

Single facer productionSingle facer production -- very slow.very slow.

Average production of 6000 sq.Average production of 6000 sq.

meters of corrugated board, permeters of corrugated board, persingle facer / per shift.single facer / per shift.

Average production of 4000 to 5000Average production of 4000 to 5000

printed boards on aprinted boards on a flexoflexo printer /printer /

er shift.per shift.


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Present TechnologyPresent TechnologyLimitationsLimitations

Average production of 3000 to 4000 DieAverage production of 3000 to 4000 Die

Cut boards per shift / per machine.Cut boards per shift / per machine.

Average production of 800 to 1500Average production of 800 to 1500

stitched boxes, per shift / per machine.stitched boxes, per shift / per machine.

Very slow production on glued boxes.Very slow production on glued boxes.

Large floor area required for production.Large floor area required for production.

Minimum 2 to 3 days required to dispatchMinimum 2 to 3 days required to dispatch

dry boxes, from start of the production.dry boxes, from start of the production.


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The Indian Packaging Industry isThe Indian Packaging Industry is

estimated at approximately $14.7 Bestimated at approximately $14.7 B

and estimated to be growing at 15and estimated to be growing at 15

percent annually.percent annually.

The per capita consumption ofThe per capita consumption ofpackaging in India is approximatelypackaging in India is approximately

$15 against a world average of$15 against a world average of

around $100.around $100.


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The large and growing Indian middleThe large and growing Indian middle

class, along with the growth in organizedclass, along with the growth in organized

Retail in the country, are driving demandRetail in the country, are driving demandin the packaging industry.in the packaging industry.

Another factor, which has providedAnother factor, which has provided

substantial stimulus to the packagingsubstantial stimulus to the packagingindustry is, the rapid growth of exports,industry is, the rapid growth of exports,

which requires superior packagingwhich requires superior packaging

standards for the international market.standards for the international market.


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ith this, the need for adopting betterith this, the need for adopting better

ackaging methods, materials andackaging methods, materials and

achinery to ensure quality, hasachinery to ensure quality, hasecome imperative for Indian players.ecome imperative for Indian players.

wo specific segments can be identifiedwo specific segments can be identifiedor opportunities in packagingr opportunities in packaging

quipment in the Indian market.quipment in the Indian market.

The UnThe Un--organized Sector.organized Sector.The Organized Sector.The Organized Sector.


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Why the need for change ?Why the need for change ?The UnThe Un--organized Sector represents theorganized Sector represents thelarger opportunity, given the increasinglarger opportunity, given the increasingqualityquality--consciousness of end customers.consciousness of end customers.

The cost of equipment and upgrades holdThe cost of equipment and upgrades holdthe key to success in this segment.the key to success in this segment.

The Organized Sector, which caters to theThe Organized Sector, which caters to the

packaging requirements of major FMCG,packaging requirements of major FMCG,Food,Food, PharmaPharma & Appliance Industries, are& Appliance Industries, areconscious of need to upgrade theirconscious of need to upgrade theirmanufacturing technology, so as to be ablemanufacturing technology, so as to be able

to offer volume, with quality, at highto offer volume, with quality, at highspeeds, enabling them to address a largerspeeds, enabling them to address a larger


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Opportunities !Opportunities !

Increasing investments by both,Increasing investments by both,

domestic and foreign companies indomestic and foreign companies in

the Indian Food Processing Sector,the Indian Food Processing Sector,

especially in beverages, dairyespecially in beverages, dairy

products, processed food, edible oil,products, processed food, edible oil,and marine products, have expandedand marine products, have expanded

the market for high end packaging.the market for high end packaging.


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ProspectsProspectsTechnology, price, delivery, andTechnology, price, delivery, andperformance, are critical factors thatperformance, are critical factors thatdetermine whether packagingdetermine whether packagingequipment will be accepted in theequipment will be accepted in theIndian market.Indian market.

Due to intense competition in theDue to intense competition in theendend--user market, the cost ofuser market, the cost ofequipment and low running cost,equipment and low running cost,remain primary factors that influenceremain primary factors that influencedecision of adopting betterdecision of adopting bettertechnology or equipment.technology or equipment.


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ProspectsProspects

There are no restrictions on the import ofThere are no restrictions on the import ofpackaging equipment into India.packaging equipment into India.

No license is required for the import ofNo license is required for the import of

packaging equipment.packaging equipment.The Duty incidence on packagingThe Duty incidence on packagingmachinery, currently is approx. 34%.machinery, currently is approx. 34%.

The components of the total duty include:The components of the total duty include: A Import Duty of 10 percent,A Import Duty of 10 percent, C V D of 16.48 percent,C V D of 16.48 percent,

A special additional customs duty of 4 percent,A special additional customs duty of 4 percent,

And an EducationAnd an Education CessCess of 2%.of 2%.


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A comparison withA comparison withChinese Scenario.Chinese Scenario.

TodayTodays new mantra for Indians new mantra for Indian

growthgrowth look at the Chinese Model.look at the Chinese Model.

Lets look at Chinese scenario:Lets look at Chinese scenario:

Historical PerspectiveHistorical Perspective

Present scenario.Present scenario.


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Historical PerspectiveHistorical Perspective

0 years old industry. Initially Corrugated0 years old industry. Initially Corrugatedoards imported from Japan.oards imported from Japan.

n 1971 the first automatic plant importedn 1971 the first automatic plant imported

rom Japan.rom Japan.

tarted as a fragmented industry as in India.tarted as a fragmented industry as in India.

40,000 small units spread across China.40,000 small units spread across China.

ntil 1990ntil 1990--91, they also used the same,91, they also used the same,

anual & semi automatic process.anual & semi automatic process.

ypically identical to the Indian Scenario.ypically identical to the Indian Scenario.


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Present ScenarioPresent Scenario

Industry growth rate > 18%.Industry growth rate > 18%.

More than 5500 automatic lines in useMore than 5500 automatic lines in usetoday.today.

Growing exports is driving demand forGrowing exports is driving demand for

high quality boxes of internationalhigh quality boxes of internationalstandards.standards.

Imagine now what is in store for ourImagine now what is in store for our

packaging industry in India.packaging industry in India.


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corrugated packaging - overview and prospects

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