To begin with may I begin by thanking everybody who has supported our society over the last year. It has been a fascinating period where nothing seems to be normal anymore.
What remains consistent is that Packaging is everywhere and growing and packaging change is inevitable to offer customers improved / innovative solutions to Quality, OTIF service, Barrier properties for shelf life, alternative materials, environmental sustainability and, of course, price.
The Global Packaging Market size is expected to grow from USD 1.10 trillion in 2023 to USD 1.33 trillion by 2028, at a CAGR of 3.94% during the forecast period (2023-2028).
From an external perspective we have seen inflation at a high of 15% and currently back down near 6.5%. Whereas over the same period we have seen average weekly wage growth of 6.1%.
Raw material prices have seen record increases and slight decreases – often attributed to e.g. oil price as low as $72 and as high as almost $100 a barrel. And what seems to go up – does not necessarily lead to timely reductions.
The energy price cap increased by 12% in October 2021, 54% in April 2022 and was due to increase by 80% in October 2022 (gas by 91%, electricity by 70%). The April increase was equivalent to £700 more across a year for ‘typical’ levels of dual fuel consumption paid by direct debit.
UK interest rate 5.25% last moved on August 3rd. It was only 18 months ago when it was 0.1.%! FTSE share price has ranged 6920 – 8014, currently 7630.
‘Shrinkflation’, has entered our lexicon – the phenomenon where manufacturers reduce pack sizes rather than increase prices to achieve improved margin by the back door. All of this has been compounded by UK Political upheaval – May, Johnson, Truss and currently Sunak. Post Brexit has had impacts on our ability to buy-in and especially export.
Some finance experts foresee a period of “stagflation” – a stagnant economy coupled with rising prices for several years.
It’s not just here in the UK of course there are global geopolitical factors, Russia / Ukraine and elsewhere, impacting energy and food security of supply.
The world’s population is more than three times larger than it was in the mid-twentieth century. The global human population reached 8.0 billion in mid-November 2022 from an estimated 2.5 billion people in 1950, adding 1 billion people since 2010 and 2 billion since 1998. The world’s population is expected to increase by nearly 2 billion persons in the next 30 years, from the current 8 billion to 9.7
billion in 2050 and could peak at nearly 10.4 billion in the mid-2080s.
This dramatic growth has been driven largely by increasing numbers of people surviving to reproductive age, the gradual increase in human lifespan, increasing urbanisation, and accelerating migration. Major changes in fertility rate have accompanied this growth. These trends will have far-reaching implications for generations to come.
In 1923 the average life expectancy in the UK at birth was 74 years for women and 67 years for men. In the current projection, life expectancy at birth for those born in 2023 is estimated to be 92 years for women and 90 years for men. Apparently 80.9 is my projected age! This alone explains why the cost of hospitals and elderly care is increasing exponentially.
With all this volatility Mergers & Acquisitions continue – in the last couple of weeks alone Skymark Packaging International was acquired by TOPPAN’s subsidiary, Interflex Group, a Japanese group. There are other major concerns particular to packaging – The Circular economy,
Plastics Tax, Deposit Return Scheme and Extended Producer Responsibility. Also, Global warming – carbon emissions and I suspect in time a carbon tax. There are change drivers everywhere.
Midlands Packaging Society has not stood still either –
The Midlands Packaging Society was awarded the Local Society of the Year Award by the IOM3. The first packaging society to win it, a recognition of everyone’s efforts on the committee. Keith Barnes was recognised with the T B Marsden Professional Medal for substantial and long-term services to the Institute, profession, and organisation in the UK. Ian Morris continues to teach packaging to new students for the IOM3, and continues to be our treasurer and secretary. Also thanks to Jeremy Plimmer we continued to publish newsletters of activities and initiatives.
We delivered several successful webinars and a successful Pack to the Future conference with great support from Nikki Clarke. Thanks as well to Suzanne Lim as we continue building our own website such that we will be better able to communicate our capabilities moving forward. This will also, for the first time, enable revenue growth as businesses can apply to be sponsors, members will still join our society for free.
Our committee grew in numbers – thanks to Patrick and Suzanne and we have retained a seat on the IOM3 Packaging Leadership Group
As your chair for the last year, I can honestly say it has been a pleasure and a privilege to serve and work alongside such talented folk and look forward to supporting in whatever capacity you determine in the coming year.
Tim Barbary, Chair. 17 October 2023.