Every two years, the Shanghai World of Packaging (swop) takes place as part of the “interpack alliance”. This year, the trade fair once again opened its doors for three days from 25 to 28 November 2019 – providing the perfect occasion to take a closer look at the Chinese packaging market and its influence on international liquid filling machine https://www.zenofilling.com/product/automatic-liquid-filling-machine/ industry. CHINA’S MIDDLE CLASS GAINS PURCHASING POWER With a gross domestic product of around 13.37 trillion US dollars, China is the world’s second largest national economy. This also means that the country achieves three times the turnover compared to ten years ago. The economic growth in China also affects living conditions in the population. In 2018, private consumption contributed a share of 76 percent to the gross domestic product; in 2010, the share was 44.9 percent. EMERGING COUNTRIES CONTRIBUTE TO THE PACKAGING INDUSTRY’S GROWTH A recent study carried out by McKinsey puts the packaging industry’s global market turnover at around 900 trillion US dollars and forecasts an average growth of 3.1 percent per year until 2022. A whopping 70 percent of that is generated by emerging countries, among them China with more than five percent. FLEXIBLE PACKAGING IN CHINA When it comes to flexible packaging, China already holds large market shares around the world. And it looks as if this is not going to change any time soon: China’s annual average growth until 2022 is estimated to be eight percent, whilst global annual average growth is estimated to be 4.3 percent. One of the main drivers for this market is the growth of the food and beverage industry in China – here, the share lies at 59 percent. The consumption of food packaging is expected to increase from 399,858 million packaging items in 2018 to 447,066 million in 2023, according to Euromonitor/VDMA. Plastic packaging makes up the largest share, followed by paper, metal and glass. Asian woman with a shopping trolley The increasing demand for food and beverages in urban areas is contributing to higher than average growth in China’s packaging industry. Photo: Phuong Tran / Unsplash PACKAGING MACHINES ON THE CHINESE MARKET According to VDMA, China is the second largest sales market for German rice packing machine https://www.zenofilling.com/product/automatic-rice-packing-machine/ behind the USA. In 2018, the land of dragons imported equipment “made in Germany” worth 366 million euros; 15 percent more than the previous year. This is followed by Italian packaging machines (156 million euros) and Japanese machines with 140 million euros. Besides importing packaging machines with a total value of 1,073 million euros, China also exported machines worth 1,204 million euros in 2018. The top sales markets for Chinese machine exports are the USA (122 million euros), Vietnam (78 million euros) and India (68 million euros). CHINA RELIES ON INTELLIGENT PACKAGING The Chinese packaging market relies on innovative technologies such as robotics and artificial intelligence (AI). Middle and high-end technology such as 3D printing, video technology and micro SMD packaging achieved a turnover of 5.88 billion US dollars in 2018. Advanced packaging achieved a global turnover of 25.6 billion US dollars in 2018 and is expected to increase to 42.8 billion US dollars by 2025. The Chinese packaging companies 3D, SIP and WLCSP alone achieved a turnover of around 5.88 billion US dollars with end packaging. E-COMMERCE AND ONLINE DELIVERY SERVICES Germany Trade and Invest quoted a turnover of 1.4 trillion US dollars for online retail in China in 2018. This corresponds to an increase of 24 percent compared to the previous year. The share of total retail trade amounts to 26 percent. In 2020, retail revenue achieved by e-commerce in China is estimated to be 355 billion US dollars. By the end of 2019, an increase to 35.3 percent is expected. Delivering foods alone generated 42 billion US dollars in 2018. China’s largest delivery service company, Meituan-Dianping, announced that it received around 6.4 billion food orders in the same year, an increase of almost 60 percent compared to 2017.