Aluminum Collapsible Tubes

Aluminum Collapsible Tubes Global Market Outlook:

• The APAC and LATAM are expected to witness the highest growth for aluminum tubes, owing to the rise of industrial and pharmaceutical in these regions

• Healthcare segment will continue to have the largest share over 45 percent in aluminum tubes, owing to the barrier properties of these tubes

• Aluminum tubes continue to face the threat of substitution, due to the substitution by cheaper tube formats, especially ABL

• The global tube market expects a significant growth of CAGR 6–7 percent from 2023E to 2027F, owing to the increasing use of flexible packaging formats in nearly all key downstream segments, especially Personal care, Hygiene and cosmetics market. The oral care market is a major demand driver

• The high demand for packaging essential commodities such as sanitizers have heled the global tubes market to witness minimal disruption. The tie ups of converters

• APAC is expected to drive growth in the next five years, with over 8 percent CAGR in 2023E-2027F, owing to the rising per capita income in the key markets, like India, China, Malaysia, Thailand, etc., coupled with the growing rate of urbanization, fostering increased consumption of FMCG products

• Concerns over sustainability and growing preference of innovative packaging over traditional formats, like glass, metal, and plastic containers, have led to the preference of tubes in personal care, pharma/healthcare, and oral care market globally

Global Packaging Tube Drivers and Constraints: Aluminum Collapsible Tubes

Drivers

Increasing Demand for Sustainable solutions

• The global packaging market is being pushed by consumers and regulatory authorities to adopt more sustainable solutions. The infinite recycling properties, coupled with excellent barrier characteristics, make it a viable alternative for many brands. Also, the increasing demand for PCR tubes have resulted in many suppliers, such as Tubex and Alltub, to create customized solutions

Regulatory Pressure on Primary Containers

• Aluminum Tubes intrinsically have high chemical inertness, light, and oxygen-barrier properties, which make them best-suited container for packaging dermatological drugs

• Stringent regulations on drug container suitability and drug approvals with Aluminum tube as primary containers will sustain Aluminum tube market growth in the next 3–5 years

Growth Opportunity in Industrial Sector

• Increased government spending on infrastructural development and the growing construction segment, especially in the developing markets, will drive the demand for Aluminum Tubes in adhesive, sealants, and caulking application in the next 3–5 years

Constraints

Market Softness and Substitution

• Demand for Aluminum tube is gradually diminishing, as the largest consumer of Aluminum tube is Europe and the largest end-use segment being the pharmaceutical segment. As Europe's pharmaceutical market is highly mature and potential for the future growth is slow, avenues for Aluminum Tubes to grow is also less. Growth markets, like APAC and LATAM, primarily use laminate tube as for pharmaceutical application, which skews the growth opportunity in these regions

Limited Scope for Innovation

• In the recent past, there were no groundbreaking Aluminum tube innovations launched, owing to significant physical challenges and slow consumption growth in the market

Key Trends in Aluminum Collapsible Tubes

Substitution

• Aluminum Tubes are gradually getting substituted by laminate tubes in its key downstream markets, like pharmaceutical, cosmetics, and industrial applications, as Aluminum Tubes have issues, like hardening and leaking, lower product dispensing ability, and marginal product innovation

• Laminate tubes, on the other hand, offer better esthetics, low cost, and user convenience, which have resulted in their preference over Aluminum Tubes

Impact

• Aluminum Tubes are expected to sustain growth in adhesives, caulking, and few pharma/healthcare application in the next decade, owing to its inert nature, which makes these tubes suitable format for packaging highly potent/volatile products

Cost Structure Analysis: Aluminum Collapsible Tubes

• Aluminum prices has increased in the past two quarters. But the prices are forecasted to come down by Q2 2023. This will reduce the impact of Raw materials on the Tubes converters.

• Raw materials are the major cost contributor in manufacturing Aluminum Tubes across all regions. They cover close to 60% over the overall cost.

• The high demand for premiumized solutions push converters to continue adopting various printing and decoration capabilities especially within developed markets