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The Packaging Industry in Latin America
XXV NATIONAL CONGRESS XXV NATIONAL CONGRESS -- AMEE AMEE III INTERNATIONAL CONGRESSIII INTERNATIONAL CONGRESS
““ Strengths and Weaknesses in the Packaging Industry Around the WoStrengths and Weaknesses in the Packaging Industry Around the Worldrld ””
Ernesto Silva
President ULADE
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México
Colombia
Perú
Bolivia
Brasil
Argentina
Chile
Sede de ULADE
Union of Latin American Packaging Associations (ULADE)
Members of ULADE
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ECONOMICECONOMICINDICATORSINDICATORS
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2008 2009* EstimateGDP Nominal (US$bn) $ 3,938 $ 3,630GDP per capita (US$) $ 8,372 $ 7,625Unemployment Rate (%) 6.9 7.5
Source : Economic Outlook and Strategy - Citigroup Globa l Markets
Economic IndicatorsLatin America
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Economic IndicatorsLatin America
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Argentina
Ecuador México
PerúVenezuela
Uruguay
BrasilChileColombia
Bolivia
0
2
4
6
8
10
12
0 2000 4000 6000 8000 10000 12000
GD
P A
vg. G
row
th i
n 2
006-
2008
GDP per Capita 2008 (USD)
Source : Comisión Económica para América Latina y el Caribe (CEPAL)
Economic IndicatorsLatin America
GDP per Cápita and Average Growth by Country
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-6
-4
-2
0
2
4
6
8
10
12
2006 2007 2008 2009*
ArgentinaBoliviaBrazilChileColombiaEcuadorMexicoPeruL A & C
GDP % by Country
% GDP
Source : Comisión Económica para América Latina y el Caribe (CEPAL)
Economic IndicatorsLatin America
* Estimate
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PACKAGING INDUSTRYPACKAGING INDUSTRY
The Packaging Industry in Latin America
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020000400006000080000
100000120000140000160000
Wes
tern
Eur
ope
Nor
thA
mer
ica
Asi
a
Eas
tern
Eur
ope
Latin
Am
eric
a
Mid
dle
Eas
t
Afri
ca
Aus
trala
sia
Source : PIRA International, Ltd
Global Packaging Industry by Region (MM USD)2007
The Packaging Industry in Latin America
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0
2000
4000
6000
8000
10000
12000
2002 2003 2004 2005 2006 2007
Carton BoardRigid PlasticFlexible PackMetalGlassOthers
(Flexible Plast, Foil, Paper)
Source : PIRA International Ltd
Growth by Type of Packaging Material
The Packaging Industry in Latin America
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30%
24%16%
22%
8%
CartonboardPlasticMetalGlassWood
Packaging Consumption by type of Material
Source : AMEE, ABRE, CENEM, IAEMex, Bra, Chile y Arg. (2007)
The Packaging Industry in Latin America
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0
2000
4000
6000
8000
10000
12000
14000
2002 2005 2006 2007
Food
Beverage
Personal Care
Cosmetics
Other ConsumerProductsIndustrial
Source : PIRA International Ltd
Packaging Growth by Market Segments
The Packaging Industry in Latin America
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Production ( M Tons)
0
2000
4000
6000
8000
10000
12000
14000
16000
2004 2005 2006 2007 2008 2009
BrazilMexicoArgentinaChile
Source : AMEE, ABRE, CENEM, IAE
The Packaging Industry in Latin America
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Argentina
Brazil
Chile
Mexico
-5
0
5
10
15
20
25
30
35
40
0 50 100 150 200
Source : PIRA International Ltd
Vo
lum
e G
row
th in
200
4-20
08
Packaging per Capita 2007 (USD)
Packaging per Cápita and Volume Growth in Selected Countries
The Packaging Industry in Latin America
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-2
-1
0
1
2
3
4
5
6
7
2006 2007 2008 2009*
GDP %Pack Volume %
Comparison of LA GDP with PackagingIndustry (%)
%
Source : Comisión Económica para América Latina y el Caribe (CEPAL)AMME, ABRE, CENEM, IAE
(Arg., Bra, Chile, Mex.)
**
* Estimate
Impact of the Economic Situation in thePackaging Industry
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Survey to see changes in consumer behaviour
76
24
74
26
88
12
0
20
40
60
80
100
Brand Size Point ofPurchase
No Change Change
Source : Procuraduría Federal del Consumidor, Abril 2009, México
• Migration to less prestigious brands
• Change to less expensive presentations
(refillable packs)
• Move to Institutional Packages
• Buy smaller sizes
• Buy more individual packages
• Switch to concentrated products
• Migration to less sophisticated stores
• Migration to non packaged products
Impact of the Economic Situation in thePackaging Industry
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POPULATION IN POPULATION IN LATIN AMERICALATIN AMERICA
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0
100
200
300
400
500
1960 1970 1980 1990 2000 2008
EcuadorChileVenezuelaPerúArgentinaColombiaMéxicoBrasil
Total Population in 2008: 580 MM
Source : Comisión Económica para América Latina y el Caribe (CEPAL)
Population in Latin America
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Why the continuous decrease in population growth rates ?– People getting married at
older age– Increased number of
divorces– Increased number of
persons living alone– Increased number of working
women– Increased migration of young
adults to other countries
Growth Rate in 2007 : 1.9%
Population in Latina America
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Fecundity Rate 1950 - 2000 Life Expectancy 1950 - 2000
Population in Latin America
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Number of Persons of more than 60 and 80 years old in LA(in millions)
0
20
40
60
80
100
120
140
160
180
200
1950 1975 2000 2025 2050
<5 años>60 años>80 años
Fuente: Naciones Unidas Proyecciones de Población, 2006
Population in Latin America
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Personas de 60 años o más años de edad en América Latina y el Caribe, por sexo (en millones)
0
20
40
60
80
100
120
1950 1975 2000 2025 2050
Mujeres 60+Hombres 60+
Source : Naciones Unidas Proyecciones de Población, 2006
Population in Latin America
Number of Persons of more than 60 and 80 years old by Sex(in millions)
Women 60 +Men 60 +
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Argentina
Ecuador
MéxicoBrasil
Chile
Colombia Perú
0.5
0.7
0.9
1.1
1.3
1.5
1.7
1.9
2.1
5 7 9 11 13 15
An
nu
al A
vg. G
r ow
th R
ate
in 2
004-
2008
% of 60 year old persons in 2008
Population in Latin America
Source : Comisión Económica para América Latina y el Caribe (CEPAL)
Average Growth Rate and % of 60 year old persons by Country
%
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The increased number of elderpeople implies a growth andspecialization of Packages forPharmaceutical products
• More packages designed for elderpeople, and specially for elder women
• Growth for Pharmaceutical products• Growth of local production• Growth of generic products• Growth and diversification of sales
channels for pharmaceutical products
0
100
200
300
400
500
600
Chile Argentina Mexico Brazil
200120062011
Growth of Packages for the Pharmaceutical Industry
MM USD
Source : Global Pharmaceutical Market, May. 2008
Effect of Socioeconomic Changes in thePackaging Industry
Growth of Pharmaceutical Industry in LA
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Increased number of people living in urban areas implies changes in consumers lifestyles
• Growth of packaged products
• Growth of ready to eat products
• Growth of easy to cook and pre
cooked products
• Longer shelf life products
• Growth of convenience products (on
the go, easy to open…)
• Growth of retailers
Effect of Socioeconomic Changes in thePackaging Industry
Population Growth in Urban Areas
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The growth of Retailers imply an
increased growth, diversity and quality
of packages
• Growth of retail chains vs. traditional markets,
mom & pop stores and open markets
• Products that traditionally were not packaged, will
be packaged and commercialzed by retailers
• Increased power of retail chains in the value chain
• Increased influence in the packaging decisions
• Growth of retail brands
• Growth of regional and international retailers
Effect of Socioeconomic Changes in thePackaging Industry
Growth of Retailers in LA
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13
28.3
9.5
28.4
24.2
15.2
41.6
9.5 %
CAGR2002 - 2007
México
México
México
Chile
Brasil
México
Chile
Brasil
Country ofOrigin
México6.0Soriana1373
Brasil5.4Casas Bahía1474
Arg, Chile, Col, Perú
5.2Falabella1545
Argentina, Brasil, Chile
7.1Cencosud1122
Countries ofoperation
Sales (Billions USD)
CompanyGlobal
RankingRanking
L A
México3.5El Puerto de Liverpool2138
México3.9FEMSA Comercio1967
México4.5Comercial Mexicana1686
Brasil$ 7.7CBD Grupo Pao de Acucar1061
Source : Global Powers of Retailing 2009, Deloitte
Effect of Socioeconomic Changes in thePackaging Industry
Growth of Local and Regional Retailers
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LAUNCH OF NEW PRODUCTS & LAUNCH OF NEW PRODUCTS & INNOVATIONSINNOVATIONS
Launch of New Products in Latin America
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category10planit_nb_10none0yplanityesgraphbaryesyesyesyesnoyesyesyesyesyesallallC/sinatra/gn/sinatra/gn
10850
7278
2559 2340 1858 15680
2000
4000
6000
8000
10000
12000
Bra
sil
Méx
ico
Arg
entin
a
Chi
le
Col
ombi
a
Ven
ezue
la
Source : Mintel
Launch of New Products by Country2008
Launch of New Products in Latin America
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category10planit_nb_10none0yplanityesgraphbaryesyesyesyesnoyesyesyesyesyesallallC/sinatra/gn/sinatra/gn
0
2000
4000
6000
8000
10000
12000
14000
16000P
last
ic
Oth
er
Car
tonb
oard
Gla
ss
Met
al
Pap
er
Source : Mintel
15,594
2,661 2,621 2,016 1,495
495
Launch of New Products by Type of Packaging Material2008
Launch of New Products in Latin America
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category10planit_nb_10none0yplanityesgraphbaryesyesyesyesnoyesyesyesyesyesallallC/sinatra/gn/sinatra/gn
0
1000
2000
3000
4000
5000
6000
7000
Fle
xibl
e
Bot
tle
Car
ton
Jar
Tub
e
Bag
Can
Buc
ket
Sac
het
Sta
nd U
p P
ouch
Source : Mintel
6,386 6,329
2,4141,697 1,622 1,435 1,036 981 884
466
Launch of New Products by Type of Package2008
Launch of New Products in Latin America
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category10planit_nb_10none0yplanityesgraphbaryesyesyesyesnoyesyesyesyesyesallallC/sinatra/gn/sinatra/gn
0
500
1000
1500
2000
2500
3000
Bak
ery
Non
Alc
ohol
icB
ever
ages
Sau
ces
&C
ondi
men
ts
Cos
met
ics
Cap
ilar
Cos
met
ics
Dai
ry P
rodu
cts
Sna
cks
Col
ored
Cos
met
ics
Soa
ps &
Bat
hP
rodu
cts
Pro
cess
ed M
eat,
Fis
h, P
oultr
y &
Egg
s
Source : Mintel
2,510
2,115 1,959 1,953 1,949
1,410
1,118 1,104940 936
Launch of New Products in Latin America
Launch of New Products by Market Segment2008
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Gracias !
Obrigado !
Thank you !