Packaging Opportunities

An Expert's View about Food and Beverage Services in Mexico

Last updated: 24 Feb 2011

An improved economic performance in the region, compounded by an increasingly sophisticated consumer, has shaped the direction of the packaging market in Mexico.

Sector briefing Packaging Opportunities in Mexico Why Mexico? An improved economic performance in the region, compounded by an increasingly sophisticated consumer, has shaped the direction of the packaging market in Mexico. This has resulted in the emergence of higher quality packaging, offering convenience and visual appeal. In addition to a growing middle class, improving conditions among poorer consumers have fuelled strong expansion in packaging volumes, creating a major opportunity for packaging firms. According to reports from the Packaging Machinery Manufacturers Institute (PMMI), ?The Mexican packaging Mexico is the second largest buyer of equipment in the packaging industry, mainly market is very dynamic. The from the U.S., and preceded by Canada. In industry offers a wide range 2007 alone, the importation market reached an of opportunities with food average of US $460 million. Spare parts processing, beer, tobacco and contributed another US $65 million, bringing the total value of the industry to over half a coffee being the main billion dollars. According to the Mexican sectors?? Association of Packaging (AMEE), sales during the first semester of 2007 increased 2.6% when compared to 2006 data, reaching a total value of US $7.8 UK Trade & Investment Sector briefing: Packaging opportunities in Mexico In 2007, Mexico manufactured 8.3 million tons baby food are also contributing to the growth of containers, with a production value of US in liquid carton packaging $6.9 billion. The total market value for packaging machinery in Mexico reached Find general information on the Mexican US$462 million in 2007. The sales of supplies market conditions on UKTI?s website. The for pre-finished packaging brought the total Doing Business Guide for Mexico gives an value to US $525 million. overview of Mexico?s economy, business culture, potential opportunities and an Most companies are still trying to adjust to the introduction to other relevant issue recent process of consolidation in the packaging industry. Whether companies are multinational enterprises that just entered packaging through a joint venture or merger/acquisitions, or are long-established Local companies, they are all attempting to take advantage of the rapid increase in certain consumption trends to boost their sales. The market is segmented as follows: ¾ RIGID PLASTIC ¾ METAL ¾ FLEXIBLE PACKAGING ¾ GLASS ¾ LIQUID CARTONS ¾ PAPER-BASED PACKAGING Consumer Trends Consumer trends in Mexico are moving rapidly in terms of new products that match new worldwide life styles, including frozen or ready- made meals, bottled water, energy and sports drinks and on the go snacks for breakfast/lunch. In Mexico, the packaging industry has benefitted from growth in demand for beer, and offers standardised, customised packaging. This standard packaging is especially important for the growing microbrewery segment, which requires distinctive packaging while avoiding identification with the higher-volume products. Since Mexico is one of the largest national markets for carbonates in the world, carbonates and bottled water were by far the leading products stimulating growth in rigid plastics. In Mexico, bottled water maintained high levels of growth due, in part, to consumers? interest in consuming healthy beverages, but also to ensure the quality of the products they consume. In addition to strong gains in milk, liquid cartons had strong demand in cream, flavoured milk drinks and fruit and vegetable juice. New areas such as beans represent new innovations in the liquid carton market, whilst penetration in areas such as wet sauces and UK Trade & Investment Sector briefing: Packaging opportunities in Mexico 65 thousand tonnes of PET were recycled. But 675 thousand tonnes were left out of the Opportunities process. With new recycling processes, more factories developing this area will be opened. The Mexican packaging market is very Moreover, products obtained from the recycling dynamic. The industry offers a wide range of process have a high commercial value. The opportunities with food processing, beer, recycling market was valued in 2006 at around tobacco and coffee being the main sectors. $44 million USD, but the potential value is However, new opportunities have opened up in around $700 million USD per year. the pharmaceutical, cosmetics and personal care industries. Mexico is now the ninth largest Although the plastic industry is very important producer worldwide. Over the last three years, both nationally and globally, one of the biggest production in the pharmaceuticals sector has issues the industry faces is the lack of know- increased by 18.2%. how to provide training courses in different fields such as process and design; as every Packaging in Mexico offers strong opportunities plastic process requires qualified personnel. for foreign companies for a number of reasons, Opportunities exist in training and diversity of including the high consumption of carbonates technologies worldwide and the demand for alcoholic drinks. Several multinational packaging companies have Recycling and biodegradable materials also successfully entered the packaging industry in represent a great opportunity, due to the Mexico and increased segmentation among recent high interest in greener technologies in consumer goods has enabled packaging Mexico, and also the lower production costs it manufacturers to innovate and to expand their represents since raw materials are no longer customer base. Expansion and consolidation needed. Environmentalists and the government with regard to retailing has also contributed to are concerned about the increasing amount of the expansion of packaging in Mexico. waste in Mexico and the lack of space for its management and disposal. However, local Due to this growth, Mexican companies have a governments, such as the one in Mexico City, tendency to invest in machinery and packaging plan to establish new waste management equipment to meet the demands of consumers. centres in order to address this issue. Mexico is one of the largest buyers of packaging equipment, with an annual average MAJOR MARKET PLAYERS growth rate of 7% over the last three years. The packaging machinery market is projected to have grown 6% in 2008 to a record $600 Mexico strives to provide excellent quality in million USD. The packaging industry the packaging sector. The glass packaging represents 1.8% of the GNP and 9.2% of the industry has become the main focus for industrial GNP. Over the last three years, food companies, because of its competitive prices production increased by 12.5% to reach compared to plastic containers and its 5,579,945 tonnes in 2007. The most important environmentally friendly manufacturing process segments in this industry are "Industrial Baking and Confectionery? and ?Fruits and With this boom in the packaging sector, Vegetables Processing?, representing 23.4 and machinery is in higher demand and European 18.5 percent of the market respectively. products, due to their high quality and technology/innovative options, can be The beverage industry recorded an increase in definitely a good option for Mexican companies production over the last three years of 21.3%, when acquiring new technologies. There is also reaching 36,892 million litres in 2007. The a strong tendency to purchase new but also most important segments in this industry are used equipment in the sector, and 85% of the "soft drinks? and ?alcoholic drinks?, equipment is imported, which represents an representing 42.2 and 22.3 percent of the enormous opportunity for UK firms. market respectively. The following companies represent the major market players in the packaging industry in PET & Environment Mexico: Mexico is recycling only 10% of the total production. It is estimated that in 2006 around UK Trade & Investment Sector briefing: Packaging opportunities in Mexico VITRO Group COPAMEX SA DE CV Copamex manufactures and sells cardboard The glass containers company manufactures sheets and corrugated cardboard boxes, as its and distributes glass containers for the soft internal fittings, for a variety of uses. drinks, beer, food, liquor and wine, pharmaceuticals and cosmetics industries. It You can be alerted to Mexico opportunities on a manufactures and distributes: regular basis by registering on the UKTI website. More on UKTI?s business opportunities Soda ash, sodium bicarbonate, calcium chloride service and salt, which are the main raw materials used in the manufacture of glass products, and capital goods such as glass forming machines and moulds. FEMSA EMPAQUES This is a group of companies that has been meeting the packaging requirements of the beverage industry for more than 80 years. Principal products: ? Refrigerators ? Plastic products ? Flexible packaging GRUPO ZAPATA Grupo Zapata is a Mexican group with a presence in Latin America and is recognised as developer of new patents and licences for the packaging industry. It is today one of the principal industrial firms in Mexico, providing a great variety of container solutions such as different shapes, sizes and uses. They have eight factories in Mexico and also factories in Brazil, Costa Rica and Guatemala. The following products are part of the portfolio of Zapata?s group: - Sanitary cans - Aerosol cans - Plastic bottles - Metal boxes - Pharmaceutical packages TETRA PAK SA DE CV This company belongs to Tetra Pak International, established in the 1950?s, and manufactures packages for juice, milk and beverages. Besides the packaging products, this company also offers distribution and technical services. UK Trade & Investment Sector briefing: Packaging opportunities in Mexico Major events and activities UKTI contacts PLAST IMAGEN 2011 When considering doing business in Mexico it is Contact: Sergio Muñoz Ortega essential to obtain legal, financial and taxation E. advice. A useful contact list of lawyers and other relevant professional bodies as well as Place: Centro BANAMEX, Mexico City further tailored information on the sector is Time: 4-7 October 2011 available from the UKTI team in Mexico City. EXPO PACK MEXICO 2011 For further details, please contact: E. Jonathan Clare Place: Centro BANAMEX, Mexico City Trade and Investment Consul Time: 21-24 June 2011 British Consulate, Monterrey Tel. +52 (81) 8356 5359 Find full details of all Mexico events on the Fax +52 (55) 8356 5379 UKTI website. New export events are added Email: daily to the site and you can register to be alerted to them on a daily, weekly or monthly basis Luis Dario Ochoa Trade and Investment Officer UKTI?s Tradeshow Access Programme (TAP) British Consulate, Monterrey provides grant support for eligible Small & Tel. +52 (81) 8356 5359 Medium Sized Enterprises (SME's) to attend Fax +52 (55) 8356 5379 trade shows overseas. Find out more about Email: UKTI support for attendance at overseas events UK Trade & Investment Sector briefing: Packaging opportunities in Mexico Next steps - How UKTI can help ? Arranging appointments British companies wishing to develop their ? Organise seminars or other events for business in the Mexico are advised to you to meet contacts and promote your undertake as much market research and company in the Mexican market planning as possible in the UK. UKTI?s team in Mexico City with its wide local knowledge and This work is available via our Overseas Market experience, can provide a range of services to Introduction Service (OMIS) a chargeable British-based companies wishing to grow their service which assists British-based companies business in the Mexico market. wishing to enter or expand their business in overseas markets. This can include: ? Provision of market information To find out more about commissioning this ? Validated lists of agents/distributors work, or accessing other UKTI services and ? Key market players or potential specialist advice, please visit the UKTI website customers in the Mexican market to find contact details for your local UKTI office ? Establishment of interest of such contacts in working with you Whereas every effort has been made to ensure that the information given in this document is accurate, neither UK Trade & Investment nor its parent Departments (the Department for Business, Innovation & Skills, and the Foreign & Commonwealth Office), accept liability for any errors, omissions or misleading statements, and no warranty is given or responsibility accepted as to the standing of any individual, firm, company or other organisation mentioned. Published 2011 by UK Trade & Investment. Crown Copyright © UK Trade & Investment Sector briefing: Packaging opportunities in Mexico
Posted: 24 February 2011, last updated 24 February 2011

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