Logistic Operations of e-commerce Impacting Mexican Processed Meat & Processed Cheese Flexible Packaging Market

The Mexican processed meat & processed cheese flexible packaging market size was estimated to be $ 435.7 million in 2018. As the trend of e-commerce and organized retail sector is blooming in Mexico, it is adding impetus to the flexible packaging market. Logistic being the core of e-commerce, it prefers flexible packaging options for hassle-free transit and storage of commodities. Growing necessity for long shelf-life products in the retail environment amalgamated with the on-the-go lifestyle of people are also influencing the growth of the Mexican processed meat & processed cheese flexible packaging market share. Hence, the market is projected to be progressing at a CAGR of 4.7% during the forecast period of 2019 – 2025.

Walmart Inc. online presence in Mexico grew by 148.6% in just 4 years (2012 - 2016):

The rampant trend of e-commerce has upgraded the entire sales infrastructure of processed food in Mexico. The retail sector giants such a Walmart Inc. has been emphasizing on implementing ‘brick-and-click’ policy that is establishing online as well as physical presence in Mexico. This has further augmented the processed food industry and is eventually playing a lead role as the Mexican processed meat & processed cheese flexible packaging market growth driver. For instance, in 2019 Walmart Inc. initiated the process to buy Cornershop, a grocery deliver application for an amount estimated to be surpassing $ 200 million. And the retail giant has a physical presence in Mexico with more than 2400 stores. Mexico is the 11^th leading importer of meat and edible meat globally, and as the trend of e-commerce and retail (particularly FMCG – fast moving consumer goods) is volatile in the country, the Mexican processed meat flexible packaging market size is gaining substantial impetus.

The total online packaged food purchases in Mexico escalated with a growth rate of 14% during the 2012 – 2016. The dominance as well as opportunities of and for Mexican processed meat & processed cheese flexible packaging market share in this growth can be indicated by the fact that dairy products holds the 3^rd spot and processed meat and seafood the 8^th rank among the total packaged food products sold online. Moreover, Walmart Inc., the largest online supplier of grocery products in Mexico grew by 148% in just 4 years during 2012 – 2016.

63 % of food products in Mexico utilize flexible packaging at a growth rate of over 10 % per year:

Mexico exported $14.67 billion of processed food in 2017. Mexico’s unceasing demand for cheeses is adding impetus to imports as well as indigenous production, eventually proliferating Mexican processed cheese flexible packaging market demand. Cheese production is forecast to reach 422,000 MT in 2019 whereas consumption will be higher 538,000 MT that reflects the increasing demand for domestic production. Furthermore, Mexico’s cheese exports is further estimated to increase in 2019 with 12,000 MT. Exports in 2018 augmented intensely, largely to the United States and Americas. Exports to the United States alone jumped more than 400% (2018). As the trade of cheese amplifying year on year, it is influence the industry related to its packaging.

High demand for poultry meat and eggs continue to drive continued growth in Mexican domestic poultry production. The forecast for chicken meat production in 2019 is 3.6 million metric tons (MT) and the forecast for 2020 is 3.7 million MT. Chicken meat dominates domestic protein production in Mexico with a 38 percent of total production in 2018. Similarly, the forecast for chicken meat consumption in 2019 is 4.4 million MT and the forecast for 2020 is almost 4.6 million MT, as strong demand from consumers and the processing industry continues.

Packaging material production industry of Mexico accounted for 8.5% of its manufacturing GDP (2017).  Moreover, packaging machinery market in Mexico is very dynamic and procurements have stood upward at about 5 % per year. In terms of demand by packaging material type, the top slots are occupied by flexible materials such as paper, cardboard, aluminum foil, retort pouches, and plastic. Other than these, active packaging norms such as the vacuum packaging and modified atmosphere packaging are also gaining considerate prevalence.

Mexico Packaging Material Demand by Type -

In terms of end-use segments, the F&B sector of Mexico accounted for 58 % of Mexican packaging imports in terms of value, which to a great extent evinces the dominance of Mexican processed meat & processed cheese flexible packaging market share. Furthermore, 63% of food products in Mexico are implementing flexible packaging with a growth rate of over 10 % per year. Food processing and agribusiness market players such as Tyson Foods, Inc and Industrias Bachoco, S.A. de C.V. are creating demand for enhanced and ecological packaging technology that is adding impetus to paper packaging. Tracing the opportunities in the retail sector, the design of flexible packaging is intended to prolong the shelf life of F&B products, take up less space on the shelf, and also to be compatible to accomplish market trends such as higher quality graphics. As imprints on glass, metal and wood initiates adverse economic effects, food industry is inclined towards flexible packaging options. Considering all these trends in the packaging sector, flexibility is the most pivotal factor that can deliver a completive edge to companies involves in processing of food such as meat and cheese. Hence, all this factors are major growth driver of Mexican processed meat & processed cheese flexible packaging market demand.

Increasing Mexico’s Plastics and Resins Production – A benefitting factor for Mexican processed meat & processed cheese flexible packaging market:

As illustrated above, plastic is the second most sought after material in Mexico by the packaging market players. As flexible packaging dominates the food processing industry, growth in indigenous production of plastic and resin is benefitting the adjacent industries including Mexican processed meat & processed cheese flexible packaging market. Plastic industry of Mexico grew by 4.08 % in 2017, which was double the economy growth of 2.04 % the same year. Despite the fact that the country produces 80% of its domestic demand for PE, PP, PET and PVC, it is highly reliant on U.S imports. But the recent years, indigenous production as well as exports has witnessed an escalation.

Mexico’s Plastics and Resins Production and Market Size - 

(Figures in USD billions)

Mexican Processed Meat & Processed Cheese Flexible Packaging Market Companies:

Some of the key players with majority of Mexican processed meat & processed cheese flexible packaging market shares are Amcor plc, Bemis Company, Inc., Berry Global, Inc, Coveris Group, E. I. Dou Pont De Nemours and Company, Lantero Group, ProAmpac LLC, Sealed Air Corporation, and Smurfit Kappa Group.

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