The BOPP-film industry, worth in the region of $15 billion, delivered over 8.4 million tonnes in 2018. The global market is currently well supplied, dominated by China and the growing influence of Indian-owned producers who continue to expand their operations globally. Global demand for BOPP film is expected to grow at a healthy rate of 4.7% p.a. over the next five years to 2023. Forecast growth in Asia is expected to be significantly higher, particularly in China and India where Wood Mackenzie expects to see growth of 6.3% p.a. and 9.4% p.a., respectively.
The issue of recycling and sustainability has, in certain applications, favoured BOPP film over other polymer films. Multi-national brands are looking to film producers and converters to provide mono-material plastic packaging solutions to meet sustainability commitments.
“Global BOPP film demand continues to see healthy growth despite the backlash against plastic packaging. In fact, the issue of recycling and sustainability has created a favourable set of circumstances for the BOPP film sector. As part of a circular economy, brands are being pressured to find more environmentally-friendly ways of packaging their products. This has caused a shift in focus from multimaterial and multilayer laminates, which are currently non-recyclable, to monomaterial laminates.
“The fact that BOPP film is part of the wider polyolefin chemical family means it can be laminated, with polyethylene film for example, and still be widely accepted in today’s recycling waste stream. Our research indicates that, in certain applications, the consumption of BOPP film has benefitted from this sustainability drive at the expense of other polymers,” says Robert Gilfillan, Wood Mackenzie head-Films & Flexibles.
Flexible packaging will continue to be the key end-use sector for BOPP film. The need for transparent commodity film, which is often used in food packaging, is expected to drive future demand. With a positive short-term outlook, investment opportunities within the sector are becoming more attractive.
“In terms of significant M&A activity, 2018 saw Jindal Poly Films become the global leader in BOPP film production by installed capacity, as it completed the acquisition of Treofan’s European operations. The technical expertise gained by Jindal Poly Films through this deal added significant production capabilities to its global network. The deal completed Treofan’s exit from the BOPP film sector, having earlier sold its Mexican manufacturing facility and US sales operations to CCL Industries (Innovia Films).
“Earlier this year, we saw another significant M&A deal take place. Taghleef Industries completed its acquisition of Biofilm, the second-largest BOP- film producer in Latin America. This has strengthened the company’s position in the Central & South American region. Additionally, Taghleef Industries has now climbed into the list of top five global players, by installed nameplate capacity,” says Gilfillan.