Made by converting resins into myriad forms, plastic packaging is a critical part of innovation and growth in food, consumer products, and other sectors.
From the plastic food packaging that extends the shelf life of snacks to the durable bottles that hold cleaning supplies to the solvent-resistant cases that preserve and protect cosmetics, plastic packaging is a critical part of innovation and growth in consumer products and other industries.
What is Plastic Packaging?
Manufactured by converting thermoplastic and thermosetting resins through a number of production methods, plastic packaging is used to protect goods during transit and storage.
There are many forms of plastic packaging, which can be rigid or flexible. Examples include bags, bottles, jugs, clamshells, trays, cartons, baskets, containers, cases, plastic film packaging, and tubes.1 To produce those many forms, converters use a mix of blow molding, plastic injection molding, rotomolding, and extrusion processes.
High-density polyethylene (HDPE), metallocene linear low-density polyethylene (mLLDPE, and linear low-density polyethylene (LLDPE) are among the most widely used polymers in the plastic packaging market due to their many desirable traits, which include strength, durability, chemical resistance, light weight, and cost-effectiveness.
HDPE is used to make milk jugs and bottles for consumer products and also has numerous non-packaging applications, from trash bins to medical devices. mLLDPE and LLDPE are some of the most popular polymers in the packaging films segment, with applications including stand up pouches, frozen food packaging, and produce bags.2
Shell Polymers will be manufacturing HDPE, mLLDPE and LLDPE at its state-of-the-art Monaca, Pennsylvania plant, slated to open in 2022. Shell experts will also collaborate with converters in the new facilities, helping to troubleshoot production, select resins, and launch new product lines.
Plastic Food Packaging is A Growth Driver
The global plastic packaging market was valued at $348.1 billion in 2020 and is expected to grow at a CAGR of 4.2% from 2021 to 2028,3 led by food and beverage, pharmaceutical, and personal and household care applications.
Plastic food packaging has revolutionized the way people buy and consume food and beverages, offering longer shelf life, reduced food waste, and greater convenience. That spans from HDPE milk jugs that first emerged in the 1960s to modern plastic films, which can keep a cucumber fresh for nearly five times as long.4
Food and beverage sector growth has created converter demand and opportunities in new product areas, including lightweight flexible packaging that’s portable and convenient to use, and transparent packaging, which protects and preserves meats and other fresh foods while allowing consumers to inspect their quality and appearance.
The desirable characteristics of polyethylene also make it a good fit for converters making personal care and wellness product packaging, which protects shampoo, cosmetics, dish soaps and laundry detergents from contamination and can be formed in unique shapes and colors to attract consumers.
Converters that want to experiment with new products can leverage the application hall at Shell Polymer’s new plant, where they can run trials on commercial-scale injection molding and extrusion blow molding machines and avoid having to sacrifice production capacity in their own facilities.
Sustainable Product Packaging Demands
Converters and brands face pressure from consumers and brands to provide packaging that is more sustainable and less wasteful.
Once again, HDPE, mLLDPE, and LLDPE offer converters a leg up in meeting customer demands.
Polyethylene products are highly recyclable and are often more energy-efficient and cost-effective to manufacture and transport, due to the heavier weights of other materials.
For example, a 10-gallon beverage container can be produced with just two pounds of plastic. Making a container of identical volume with other materials would require:
- Three pounds of aluminum
- Eight pounds of steel, or
- More than 40 pounds of glass5
Plastic packaging can also be recycled through a process called pyrolysis. This waste-to-chemicals technology transforms plastic waste that’s tough to recycle into a recycled feedstock (pyrolysis oil) that can be used to make sustainable chemicals.
In 2021, Shell took a 21.3% equity stake in a pyrolysis initiative known as BlueAlp. We aim to use one million tonnes of plastic waste a year in our global chemicals plants by 2025.
Shell is also working with industry, government and nonprofit organizations that have pledged a combined $1.5 billion to reducing plastic waste in the environment over the coming years.
Shell is applying the principles of a circular economy – reducing waste and increasing reuse and recycling – across our businesses and supply chains. Shell has committed to increasing the amount of recycled plastic in our packaging to 30% by 2030.
How is the Plastic Packaging Market Changing?
There are several significant ongoing or emerging trends expected to impact the plastic packaging industry over the coming years, including:6
- The growth of e-commerce and last-mile delivery models
- This trend accelerated during the Covid-19 pandemic
- E-commerce sales grew more than 16% in the first three quarters of 2021 vs. the same period in 20207
- Consumer demand for personalized, convenient, healthy, local, and affordable products
- Consumers are 3.7 times more likely to try to avoid buying products from “the big food companies”8
- Retail margin compression increases cost pressures on packaging makers
- If fast-moving consumer goods manufacturers fail to manage this trend, they could see their own margins decline from 15% to somewhere between 0% and 5%9
- Converters face pressures to reduce waste and produce lighter, more flexible packaging products
- Public awareness of waste plastic in the environment is at an all-time high10
- Digitization of packaging
- Predictions call for packaging providers to incorporate QR codes and other technology into their substrates over the coming years
The industry and technical experts who work in Shell Polymers’ new Pennsylvania plant are committed to converters’ business success and can work collaboratively with customers to adapt to the challenges and opportunities that these trends present.
1 Containers and Packaging, U.S. Environmental Protection Agency www.epa.gov/facts-and-figures-about-materials-waste-and-recycling/containers-and-packaging-product-specific-data#PlasticC&P
2 Low Density Polyethylene, ScienceDirect, www.sciencedirect.com/topics/engineering/low-density-poly-ethylene
3 Plastic Packaging Market, Grandview Research, March 2021, www.grandviewresearch.com/industry-analysis/plastic-packaging-market
4 Dhall RK, Sharma SR, Mahajan BV. Effect of shrink wrap packaging for maintaining quality of cucumber during storage. J Food Sci Technol. 2012, www.ncbi.nlm.nih.gov/pmc/articles/PMC3550898/
5 Resins and Types of Packaging, Advanced Circular Packaging, www.plasticpackagingfacts.org/plastic-packaging/resins-types-of-packaging/
6 No ordinary disruption - Winning with new models in packaging 2030, McKinsey, May 2019 https://www.mckinsey.com/industries/paper-forest-products-and-packaging/our-insights/winning-with-new-models-in-packaging
7 U.S. ecommerce sales increase 6.8% in Q3 2021, Digital Commerce 360, Nov. 2021, www.digitalcommerce360.com/article/quarterly-online-sales/#:~:text=Ecommerce%20reached%20%24612.86%20billion%2C%20up,first%20nine%20months%20of%202020
8 No ordinary disruption - Winning with new models in packaging 2030, McKinsey, May 2019 https://www.mckinsey.com/industries/paper-forest-products-and-packaging/our-insights/winning-with-new-models-in-packaging
9 No ordinary disruption - Winning with new models in packaging 2030, McKinsey, May 2019 https://www.mckinsey.com/industries/paper-forest-products-and-packaging/our-insights/winning-with-new-models-in-packaging
10 No ordinary disruption - Winning with new models in packaging 2030, McKinsey, May 2019 https://www.mckinsey.com/industries/paper-forest-products-and-packaging/our-insights/winning-with-new-models-in-packaging