Iran to drive growth in flexible packaging market

By Eliot Beer

- Last updated on GMT

Packaging for butter is one of Iran's main flexible packaging imports
Packaging for butter is one of Iran's main flexible packaging imports

Related tags Middle east United arab emirates

The Middle East flexible packaging market is set to grow by 4.3% a year over the next five years, up from 2.5% according to a new report from PCI Films Consulting.

But the $1.16bn market remains relatively small compared to Europe, with per capita consumption at just over $5, compared to $30 in Europe.

“The lifting of sanctions in Iran is expected to have a positive effect on growth,”​ said Joanna Smith, business development manager at PCI Films. Iranian sanctions have been the main break on growth in the region, according to Smith.

Economic instability in Iran has seen flexible packaging consumption fall in recent years. Other countries facing political, social and economic instability, such as Syria, have also seen declines in the market, offsetting stronger growth elsewhere in the region, according to PCI Films.

Saudi Arabia, the second biggest market in the Middle East, will see 6.4% growth up to 2018, consuming an additional $85m in flexible packaging a year.

PCI Films lists increased investment in food production and processing, increased capacity to manufacture flexible packaging in the region, and growth in modern retailing and penetration of pre-packed foods as key factors driving growth in the market.

“The growing trend towards modern retail shopping malls and grocery outlets has driven growth in flexible packaging in many countries and converters have increased capacity as a result. Also, the UAE’s strategic location with excellent ports and strong infrastructure has helped smaller converters to expand internationally,”​ said Smith.

“In the Middle East’s largest flexible packaging markets of Iran and Saudi Arabia, imports are minimal as most of the two country’s flexible packaging needs are satisfied by domestic converters,”​ she added.

Saudi Arabia imports around 10% of its flexible packaging, mostly from other Middle Eastern countries, while Iran currently imports just 6.5%, mostly from Turkey in the form of packaging for cigarettes, butter and chewing gum, according to Smith.

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