Stretch & Shrink Films Market Size Forecast to Reach $21.4 Billion by 2027

Stretch & Shrink Films Market | IndustryARC

Stretch & shrink films market size is forecast to reach US$21.4 billion by 2027 after growing at a CAGR of 51.2% during 2022-2027. The stretch & shrink films market's expansion can be attributed to the increasing substitution of conventional packaging materials with stretch and shrink films. Materials including linear low density polyethylene (LDPE), high-density polyethylene (HDPE), and other similar materials improve the stretch and shrink film's flexible packaging capabilities, which is useful for package durability. The stretch and shrink market is primarily driven by the growth of the food and beverage industry. Also, the growing demand from the cosmetics industry for stretch & shrink labels is anticipated to further boost the stretch & shrink films industry growth during the forecast period.

COVID-19 Impact

In the year 2020 and 2021, the Covid-19 pandemic impacted the supply chain which resulted in the shortage of raw material for the manufacturing of stretch and shrink films, this negatively impacted the growth of the market. Furthermore, because of the supply chain disruption, raw material exports also declined, which resulted in the shortage of raw material. For instance, according to the International Trade Centre (ITC), in the year 2019, the total exports of linear low-density polyethylene (LLDPE) across the world was US$23.78 billion, and in 2020 it was US$21.32 billion, a decline of 11.5%. However, in the year 2021, production activities were boosted across the countries to foster the economic growth of the countries, this resulted in the growth of the market. Also, it is projected that the Covid-19 pandemic will end by the end of 2022, which will result in market situations before the Covid-19 pandemic.

Stretch & Shrink Films Market Segment Analysis – By Raw Material

The polyethylene segment held the largest share in the stretch & shrink films market in 2021 and is growing at a CAGR of 6.8% during 2022-2027. The polyethylene materials such as low-density polyethylene (LDPE), linear low-density polyethylene (LLDPE), high-density polyethylene (HDPE), and more are increasingly been utilized in stretch & shrink films, owing to the polyethylene's superior seal, shelf life, and printability. Polyethylene materials are expected to have growing demands as compared to other raw materials such as polyvinyl chloride (PVC), because polyethylene materials are stronger, tougher, and can withstand high temperatures. These factors are anticipated to fuel the demand for polyethylene during the forecast period.

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Stretch & Shrink Films Market Segment Analysis – By End-Use Industry

The food and beverage segment held the largest share in the stretch & shrink films market in 2021 and is growing at a CAGR of 8.2% during 2022-2027. Stretch and shrink films are frequently used in the food and beverages industry for the packaging of fresh food, frozen food, beverages, and other similar products. Because these films have a high impact strength, there is minimal packaging deterioration and the food and beverages remain protected. The growing demand for the food and beverage industry is accelerating the stretch & shrink industry growth. For instance, according to Food Drink Europe, the food and beverage industry in Europe produced a 96.7 production index in the second quarter of 2020, and a 104.6 production index in the third quarter of 2020, an increase of 8.2 percent. Thus, the growing food and beverage industry is aiding the stretch & shrink market growth.

Stretch & Shrink Films Market Segment Analysis – By Geography

Asia-Pacific region held the largest share in the stretch & shrink films market in 2021 up to 42%, owing to its increasing demand from end-use industries such as food and beverage, personal care, and more. For instance, according to Invest India, the food processing sector in India is one of the world's largest, with output anticipated to reach US$535 billion by 2025-2026. Moreover, the growing personal care industry in the region is further boosting the growth of the market. For instance, according to the Accord Australasia, in 2019 the cosmetics and personal care industry of Australia was US$26.06 billion, and in 2020 it was US$26.3 billion, an increase of about 1%. Thus the growing food and beverage, personal care, and other industries in Asia-Pacific are anticipated to propel the growth of the market during the projected period.

Stretch & Shrink Films Market Drivers

Rapid Development of the Cosmetics Industry

Product damage occurs frequently in the personal care sector, as it does in many other industries, throughout the transportation procedure required for distribution. Personal cares goods frequently require additional protection to ensure that the products and primary package remain in excellent shape for consumers, owing to this stretch & shrink films are utilized in personal care products such as body care, skincare, and more. The growing cosmetics industry is propelling the stretch and shrink films market growth. For instance, according to the Cosmetic, Toiletry and Perfumery Association (CTPA), in 2019 the global sales of hand care products were €54.09 million (US$60.6million) and in 2020 it increased to €68.25 million (US$77.9million) with an overall increase of 26.2%. Moreover, in 2019 the sales of body cream and lotion at the global level was€198.39million(US$222.1million) and in 2020 it increased to €201.36 (US$229.99million) with an increase of 1.5%, which resulted in an increased demand for the stretch & shrink films market. Thus, the rapid development of the personal care industry is anticipated to fuel the growth of the market.

Growth of Electronic and Electrical Sector

Stretch and shrink films are used in the electronic and electrical industries to protect uncovered electrical wires in various systems from abrasion. The increasing demand for smartphones is accelerating market growth. For instance, according to Global System for Mobile Communication, there will be 700 million new mobile subscribers in the world by the year 2025, this will increase the demand for stretch and shrink films. Similarly, the consumer appliances and electronics sector are further aiding the stretch & shrink films industry growth. For instance, according to Invest India, it is anticipated that India’s consumer appliances and electronics industry will reach US$21.18 billion growing at a CAGR of 11% by 2025. Thus the growing demand for the electronic and electrical sector is anticipated to further fuel the stretch & shrink market growth during the forecast period.

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Stretch & Shrink Films Market Challenges

High Cost associated with the Testing of Stretch & Shrink Films

The high cost associated with the testing of the stretch & shrink films is limiting the growth of the stretch & shrink films market. According to the European regulation (EC) 1935/2004, packaging companies must use high-quality packaging materials because they come into close touch with products such as food, pharmaceuticals, and personal care items that have a direct impact on consumer health. As a result, the packaging manufacturer must conduct a thorough toxicological analysis. The cost of the test is high. With the growth in migration, the expense of evaluating plastics and other materials rises. Thus these factors make the testing cost high, which is posing as a major roadblock for the growth of the market.

Stretch & Shrink Films Industry Outlook

Technology launches, acquisitions, and increased R&D activities are key strategies adopted by players in the stretch & shrink films market. Major players of the stretch & shrink Films market are:

Clondalkin Group Holdings BV
Bemis Company
Berry Plastic Group Inc.
Klockner Pentaplast Group
Amcor PLC
Sigma Plastics Group
Huhtamaki Oyj
Schur Flexibles
Taghleef Industries
Cenveo Group

Recent Developments

In August 2021, Revolution has acquired Five Points Films, a stretch & shrink films maker based in the United States. With this acquisition, Revolution will be able to extend its stretch film market.

Key Takeaways

Asia-Pacific region dominates the stretch & shrink films market, owing to the growth of the food and beverage industry. For instance, China Chain Store & Franchise Association, China's food, and beverage (F&B) industry was valued at US$548.6 billion and in 2019 it reached $595 billion, an increase of 7.8%.
People across the world are demanding high-quality and flexible packaging products such as food and beverage, cosmetics, electronics, and more, which is propelling the market growth.
The declining preference for polyvinyl chloride films is expected to fuel demand for polyethylene-based plastic films, which will help the stretch & shrink films industry over the forecast period.
Furthermore, prominent producers are developing bio-degradable stretch and shrink films to address the issues of film disposal, which is projected to drive demand.

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