Soaring Demand Drives Paper Trays Market Growth during the Forecast Period, 2018-2027

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Tier one companies in the paper trays market, namely, Mondi Group Plc, Huhtamaki Oyj and Billerud AB, are consolidating their positions in the developed countries. Collectively accounting for over 15 percent of the overall Paper Trays Market, these companies have their grounds set up in the North America region and Europe respectively. However, these companies have been focusing on emerging economies in the Asia Pacific, such as China and India, in a bid to expand their footprint at the international level. Moreover, tapping huge growth potential in Asia Pacific with respect to sales potential of paper trays has been the focal point of tier 1 companies.

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Key strategies of tier 1 companies in paper trays market have been expansion of manufacturing facilities, new product launches and strategic alliances. Using these strategies, they are fixated on expanding their visibility in the forthcoming years. In 2017, Mondi Group Plc acquired Powerflute Group that operates paper and pulp mill. The €365 million acquisition would ensure high quality packaging and paper assets for the company along with geographic expansion and enhancement of Mondi’s paper trays scenario.

Tier 2 Players Account for Over 25% Market Share

Two main participants in the tier 2 category involved in the manufacturing of paper trays collectively account for a significant share of the overall paper trays market. Companies such as Stora Enso Oyj, and International Paper account for over 25 percent revenue share of the paper trays market with a significant revenue generation from European countries and North America region respectively.

Companies in the paper trays market are also initiating collaborations with local players to enhance their paper tray product penetration. For instance, Graphic Packaging combined with International Paper’s consumer packaging business in North America, with the latter owning 20.5% share and former owning 79.5% share of the combined company. This strategic amalgamation can serve as a huge platform for Graphic Packaging in the paper trays space, making it one of the leading companies in paper-based packaging sector.

Supermarkets to Prefer Paper Trays Over Plastic Counterparts

The paper trays market is largely influenced with growing demand from supermarkets worldwide. The ongoing plastic bans on account of environmental safety has transformed the FMCG packaging landscape as vendors of FMCG products and other consumer goods including food and beverages opt for paper trays and their variants such as fiber paper trays. Sustainability and fit for purpose paper trays are making a new entrance among food chains and supermarkets on the back of environment friendly production process of paper trays.

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Companies in the paper trays market are leveraging this factor by linking with such supermarkets to promote their products. For instance, in 2018, Iceland Foods has linked with Stora Enso Oyj to replace plastic trays with paper trays. Iceland Foods would now be introducing its street food range in paper trays.

Likewise, tier 1 players have also started collaborations with local supermarkets for the same cause. For instance, in October 2018, Huhtamaki Oyj has collaborated with Waitrose & Partners, a UK based supermarket. The collaboration is to test the fiber-based recyclable tray by Huhtamaki for a period of two months.

Molded-Fiber Paper Trays Gain Momentum

Molded fiber paper trays are gaining significant traction on the back of growing inclination toward sustainable packaging. Apart from being eco-friendly and biodegradable, paper trays from molded fibers feature relatively higher strength and high resistance against dampening. In addition, molded fiber paper trays are cost effective with minimum warehouse and inventory cost.

Plant-Based Plastic Trays Emerge as Effective Alternative to Paper Trays

Players involved in plastic packaging have been focused on solving plastic problem. A shift toward using plant-based plastics in the manufacturing of paper trays has been witnessed. Paper trays from plant-based plastics are environment friendly, feature high strength and are a sustainable business practice. Cornstarch is one of the widely used material in paper trays made from plant-based plastics and have limited negative impact on environment. This factor continues to challenge the adoption of paper trays, in turn restricting the growth of the paper trays market.

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