Packaging Tubes Australia Market Intelligence

Are you looking for answers on Packaging Tubes Australia?

Are you looking for answers on Packaging Tubes Australia?

  • What are the key trends in Packaging Tubes Australia?
  • Am I paying the right price?
  • Am I working with the right supplier?
  • What are the major challenges and risks in Packaging Tubes Australia?
  • How is Packaging Tubes Australia industry performing?

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Regional Market Outlook on Packaging Tubes

  • The personal care industry would continue to maintain its dominance as the key end-use market for laminated tubes in Australia
  • Due to cost-saving opportunities and improved barrier protection & decoration, laminate tubes are expected to gradually replace plastic & aluminum in the cosmetics and pharmaceutical markets in the near future
  • The Australian packaging tubes market is valued at around $82 million in 2018, and it is expected to reach around $87 million in 2023. The market is anticipated to have sluggish growth in the next five years, due to the matured nature of the market
  • However, demographic factors, like demand from middle-class families, with high disposable income and increasing preference for convenient-sized packaging, would help to sustain the growth, particularly in the personal care and pharmaceutical segments
  • High barrier properties in aluminum tubes and enhancements in decorations in laminated tubes would drive the demand in pharma and personal care segments, respectively
  • The supply base for packaging tubes in Australia is relatively smaller, with the presence of small to medium-sized players. Amcor is the only global player with a presence in Australia

    trends-packaging-tubes-australia



Global Packaging Tube Drivers and Constraints: Laminated Tubes

Drivers

High Growth in Oral Care Market

  • Oral care is the largest end-use segment for laminate tubes, with over 70 percent of the market share

  • Increasing awareness of oral hygiene, especially in the developing markets, like India, China, etc., has triggered almost double-digit growth rate in these regions

Growth Opportunity from Alternative Markets

  • Owing to the cost competency, high printability, and barrier properties, laminate tubes are gradually expanding into various end-use markets, especially in cosmetic application
  • ABL tubes are gradually replacing aluminum tubes in the pharmaceutical healthcare application and PBL, replacing extruded plastic tubes in the cosmetics segment

Flexibility in Printing and Decoration

  • Owing to the increasing preference of esthetics and shelf appeal, tube convertors are gradually switching to lower cost laminate tube packaging format, which can provide excellent printability and decoration flexibility

Strong Raw Material Supply

  • Leading polyethylene resin producers, like Dow Chemicals, Sabic, Borealis, etc., run at sizeable production volume, with low to marginal price fluctuation throughout the year
  • The strong supply base provides tube converters low risk of supply disruptions and stable pricing

Constraints

Recycling Challenges

  • The laminate tube body is manufactured using multiple resins, e.g., LDPE body, HDPE shoulder neck, and PP cap, which makes recycling of these tubes very challenging, and hence, a less sustainable packaging format

Strong Dominance of Plastic Tubes in Cosmetics

  • Although, PBL is emerging as a strong alternative to extruded tubes. But, the laminate tube penetration in the cosmetics segment is still low at ~14 percent. Also, plastic tubes, unlike laminate tube, have bounce-back properties, seamless design, and high esthetic value, which makes it a highly preferred option for the beauty segment

Porter's Five Forces Analysis

Supplier Power

  • Due to low switching cost and fragmented supply base, suppliers would tend to have low bargaining power
  • Recent drop in crude oil price is also expected to bring down the production cost of PE resins, further skewing the power in favor of convertor 

Barriers to New Entrants

  • Barrier for new entrants will be very high, owing to the presence of large global players, such as Albea, Essel, Alltub, Berry, etc., with long-term supply agreements, with global oral and cosmetic companies, such as Unilever, P&G, Colgate, etc.
  • Advancements in the dispensing systems also increase the production complexity and cost, thereby increasing entry barrier

Intensity of Rivalry 

  • Supply base in the developed market is fragmented, especially in Europe, with presence of multiple large-scale players competing the market
  • Local rivalry is further intensified, owing to the growing complexity of tube design, sustainability, and decoration, which is also causing large number of acquisitions in the market
Buyer Power
  • The supply base is fairly consolidated with large players, like Albea, Essel, Alltub, Visipack, etc., catering to majority of regional cosmetics and pharmaceutical demand
  • However, large players, like P&G, Colgate, and L'Oreal, owing to their large contracted volume, can negotiate for volume discounts

Threat of Substitutes

  • Innovative injection-molded tube can pose a significant threat to laminate and plastic tubes, owing to better sustainability, printability, and recyclability

 

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