Market Definition
The packaging of alcoholic beverages plays an important role in the success of the products in the market, as the logo, topography, branded colors, etc., of the packaging, help the brands to communicate with their customers that further create an impact on the mind of the consumers. Therefore, influencing them to buy alcohol of a particular packaging & brand. Furthermore, the increasing popularity of alcoholic drinks like beer, wine, etc., among adults has led to the demand for these drinks in the region.
Additionally, the easy availability of a variety of alcoholic beverages & their unique & impactful packaging designs has also attracted the customers to try these products. As a result, the packaging is crucial to alcoholic beer brand recognition & marketing, thereby attracting consumers. Thus, these factors increase the sales of alcoholic beverages, which further drives the packaging demand for alcoholic beverages in Latin America.
Market Insights
The Latin America Alcoholic Drinks Packaging Market is projected to grow at a CAGR of around 4.7% during the forecast period, i.e., 2022-27. The Latin American Alcoholic Drink Packaging market held considerable growth during the historical period, owing to the growing number of alcohol consumers in the region. This is due to the launch of new products by the brands attracting the customers to try out the latest products coinciding with the growing number of tourists in the region who spends money to taste the famous alcoholic beverages in the region.
| Report Coverage | Details |
|---|---|
| Study Period | Historical Data: 2017-20 |
| Base Year: 2021 | |
| Forecast Period: 2022-27 | |
| CAGR (2022-2027) | 4.7% |
| Country Covered | Brazil, Argentina, Colombia, Mexico, Peru, Chile, Ecuador, Rest of South America |
| Key Companies Profiled | Cristalerias de Chile, Owens-Illinois Inc., Crown Holdings Inc., Amcor plc, Ball Corporation, United Bottles & Packaging, Envases Venezolanos, Ambev., Others |
| Unit Denominations | USD Million/Billion |
The primary function of the packaging of alcoholic beverages is to protect the product from leakage or contamination during the storage, logistics, and handling of the product. Additionally, these drinks require protection from direct sunlight exposure, carbonation loss, oxygen ingress, and dissolution of the package material components as these factors could adversely affect the taste & quality of the drinks and cause health-related issues for consumers, negatively impacting the brand image. Hence, the packaging of alcoholic beverages is the utmost priority for the alcohol manufacturing companies to enhance their brand image & attract customers to buy their products.
Furthermore, alcohol consumption has risen significantly in the Latin American market in recent years, owing to the growing number of tourists visiting the Latin American region, as these tourists prefer to spend money on trying a variety of alcoholic drinks that are popular in the area. Moreover, the growing consumption of alcoholic drinks in the region due to the increasing popularity has further contributed to the growth of the alcohol drinks packaging in Latin America.
Besides, the sales of alcoholic drinks reduced during the COVID-19 pandemic as the imposed lockdown led to the shutdown of public places like nightclubs, bars, etc., where the individuals preferred to have alcoholic drinks. However, the introduction of online platforms that offer alcoholic beverage delivery services to doorsteps also assisted in boosting alcoholic beverage sales throughout the pandemic period.
Key Trends in the Market
The increasing inclination of the beverage companies toward sustainable packaging to reduce carbon emissions & provide compliant to-go packaging is helping the companies to attract the customers & enhance their brand value. The most used packaging material for alcoholic drinks is glass bottles. However, the production of glass bottles causes a lot of heat, which contributes to producing carbon footprints. Hence, the companies have come up with numerous packaging materials like Cellulose Fiber Solutions, New Wave Plastic, etc., and methods such as Returnable Glass Bottles, Shrinking the Product, etc., helping the companies to shift toward sustainable growth.
Impact of COVID-19 on the Latin America Alcoholic Drinks Packaging Market
The COVID-19 pandemic reduced the sales of alcoholic beverages significantly, due to the shutdown of the retail shop & the preferred drinking public areas such as nightclubs, bars, etc., in the region. However, the disruption in the supply chain of the raw material also impacted the packaging industry adversely, leading to fluctuating prices of the packaging material. However, the lockdown encouraged the customers to consume alcoholic drinks at home, which was further facilitated by the availability of the online alcohol drink delivery apps launched in the Latin American market. Furthermore, the bars, clubs, and restaurants that offer alcoholic drinks are reopening due to the relaxation of the COVID-19 protocols, further enhancing the sales of alcoholic drinks in the market. Hence, this helped the packaging industry in Latin America to flourish again.
Market Segmentation
Based on Drink type:
Among them, the Beer drink type held a considerable share in the Latin America Alcoholic Drink Packaging market, owing to the increasing consumption of beers by consumers in the market. Beer is one of the highest consumed drinks in the Latin American region after coffee & cold drinks because it is considered a celebration drink among the youth. However, due to the imposition of lockdown during the COVID-19 pandemic, the supply chain was disrupted & the import of beer from Europe was limited. This gave the country's regional microbreweries a chance to increase production & business growth throughout the period. Hence, creating a high demand for the growth of the packaging industry in the market.
Based on Packaging Type
Of them all, the Glass Bottles held a considerable share in the Latin America Alcoholic Drink Packaging market, owing to the preference of the consumers to drink alcoholic beverages in glass bottles. As opposed to metal cans & plastic bottles, glass bottles are relatively inexpensive. The glass packaging options are eco-friendly due to their recyclable nature, attracting manufacturers to opt for the respective packaging type.
Besides, the metal can is another segment that has gained traction due to its recyclable nature as well as its tendency to keep the content intact from damage. Metal cans also provide a barrier from sunlight & moisture, due to which the alcohol content & flavor remain intact. Hence, owing to the listed factors, the metal cans packaging type is also anticipated to lead the market in the coming years.
Regional Landscape
Geographically, the Latin America Alcoholic Drink Packaging Market expands across:
Of all the countries, Brazil held a significant market share in the region, as the Brazilian alcoholic market is mainly supplied by domestic brands further enhancing the demand for the packaging products for alcoholic drinks in the market. Additionally, the alcohol sector accounts for a major part of Brazil's economy. For instance, in 2018, according to the Brazilian Beer Association, the beer sector accounted for USD107 billion, which is 1.6 percent of Brazil’s GDP.
Furthermore, the Brazilian alcoholic consumer population is growing as they are adopting the trend of “drink less but drink better”, hence this trend allows the consumers to try out new brands & create sales opportunities for premium & newly launched alcoholic drinks. Additionally, the alcohol sector accounts for a major part of Brazil's economy.
Recent Development by Leading Companies
Market Dynamics:
Key Driver: Growing Consumption of Alcohol in the Region to Accelerate the Demand for the Packaging
The increasing consumption of alcoholic beverages in the market among all age groups due to the growing popularity & availability of alcoholic drinks has led to the market growth of the alcoholic drinks packaging demand in the market. Furthermore, increasing the per capita income of the region is allowing the customers in the region to try new products launched by the market players.
Moreover, the influx of tourists in the regions is enhancing the demand for alcoholic beverages, which further accelerated the market for the advanced & impactful packaging of these products, as the packaging plays a major role in the marketing of these products.
Possible Restraint: Rising Awareness About the Adverse Effects of the Alcohol Could Restrain the Market Growth
Alcohol consumption causes severe problems to the health of the consumers, such as Alcohol Use Disorder (AUD), Cirrhosis, and alcohol?related violence, which are some of its side effects. According to the National Library of Medicine, in 2016, within Latin American countries, approximately 241,000 deaths were caused by alcohol use disorder (AUD), cirrhosis, and alcohol-related violence. Furthermore, the government of several countries has taken various initiatives to create awareness about the negative effects of alcoholic drinks among the citizens.
Additionally, the government started the campaigns to spread awareness about the ill effects of alcoholic beverages, thus restraining numerous customers from consuming these beverages. Therefore, the reduced demand for alcoholic beverages would also decline the market for the packaging of alcoholic drinks in the forecast years.
Key Questions Answered in the Market Research Report:
Frequently Asked Questions
A. The Latin America Alcoholic Drinks Packaging Market is expecting around 4.7% CAGR during 2022-27.
A. Beer is anticipated to emerge as an opportunity area for the leading players in the market during the forecast period.
A. The Growing Shift of Customers Towards Packaging for Convenience to Open & Carry Alcoholic Beverages would create an opportunity for market growth.
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