Sustainability innovations drive growth for functional and barrier coatings
The market for functional and barrier coatings used in paper and board packaging applications topped 3 million tonnes in 2018; the total market will increase by an additional 1.5 million tonnes to 2024, adding roughly $3.2 billion to the total value at constant 2018 prices, an average CAGR of 7.7%.
Brand owners and retailers who are looking to improve their environmentally friendly credentials are driving the use of recycled and recyclable materials in packaging, which is creating pull-through demand in paper and board manufacturing. Recycled fibers accounted for 73% of the total volume of containerboard production in 2011, growing to about 77% in 2018 and expected to make up just under 80% of the total volume in 2023.
Trends in food packaging
Food and beverage packaging accounts for some 80% of demand for coating on paper and board packaging and thus it is useful to understand the anticipated growth in demand for the various types of packaging used in food applications. Flexible plastic packaging materials are expected to show the highest value growth over the period from 2019 to 2024, while metal and other materials such as wood are expected to show below-average growth. Total packaging demand by value is likely to grow by nearly 3% annually across the five-year period. Paper board and flexible paper demand will grow by 3% to 3.5%.
Water vs solvent
There is a growing trend to change from solvent-based coatings to water-based, which will reduce volatile organic compounds (VOCs) emissions and provide safer working environments for workers. Much developmental work is underway to progress commercially viable water-based functional and barrier coatings for paper and board packaging applications in an effort to find alternatives to extruded plastics, especially polyethylene and PET, paraffin-based wax, silicones and fluorochemicals.
Technology and application trends
The industry is taking numerous innovative actions to develop new technologies and efficiencies in the coatings market. Circular polymers, launched by SABIC in January 2019, represent a disruptive innovation in plastics recycling. Plastics are expected to become more acceptable to retailers, brand owners, and consumers.
Alternatives to wax-based coatings continue to be the focus of much developmental effort, with products such as hydrogenated tallow diglyceride commercially available and starting to penetrate this market. Antimicrobial coatings that offer enhanced barrier properties are under development. Biomaterials have long been the focus of significant research and will ultimately result in the erosion of the petroleum-based polymer coatings market. Improved coating application technologies, such as curtain and slide coating processes, are creating the opportunity for greater efficiencies and cost-effectiveness in coating processes.