Packaging Market Report and Economic Analysis of Turkey

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Packaging Market Report
And
Economic Analysis

Olmuksa International Paper – Sabanci Ambalaj Sanayi Ticaret A.Ş., Dentaş Ambalaj and Kağıt Sanayi A.Ş., Bakambalaj A.Ş., Kartonsan Karton Sanayi Ticaret A.Ş. has big proportion of market share in packaging sector in Turkey which analyzed in this report. Main goods in this sector consist of all types of packing products such as plastic bags, cardboards, paper box, glass products, wood, metal and cellulosic products that can be used in packaging of different kind of consumer goods. These main products are generally inputs for another good but there are also some exceptions like “ready to exposure textile box” and some carton boxes which are produced to be used in another sector. According to material based market share in 2010, in Turkey, paper and cardboard packaging have the lead by 39%, plastic packaging is second by 33% and glass packaging is third by having 13%, and finally wood have 8% and metal packaging have 7% share in packaging market. As import and export activities are common in this market therefore packaging industry in Turkey can be defined as an international market. As stated in the market research of Turkish Packaging Manufacturers Association in 2011, the market size is 9 Billion USD for the year 2011. In addition, in terms of market size estimation for next year, taking in consideration of post-crisis period in Turkey, the average growth is 24% in the market. As a result of these numbers, the estimated market size will be 11.16 Billion USD in 2012. Turkey has an important share in global packaging industry market. Thus, Turkey exports its packaging products to 191 countries, particularly European Union countries. In 2010, Germany, United Kingdom, France, Iraq, Persia, Italy, Israel, Holland, Russia and Greece were top 10 exported countries.

As packaging products are used in every aspect in human life like food, beverage, clothing and other many different sectors; the products are necessity goods, there will be always an increase in demand through upon time. Urbanization, population growth, increase in wealth, increase in participation of women to labor force, change in consumer behaviors, increase in retail sales due to wide spreading of malls around Turkey, increase in demand for consumables and increase in export are the main factors that leads to a consistent increase in demand. So, the only factor decreases the demand for this goods is economic crisis. An appropriate example for this situation encountered in between 2008-2009 years where the demand regressed from 6.2 Billion USD to 5.9 Billion USD. As a result, the 5% regression in the market for these years is the reflection of the only demand changing factor. On the other hand, a technological advance affects the demand in a positive way. Market products are generally input goods therefore a technological innovation in production line raises the demand and also the companies which use these products as an input for their final goods. Market fluctuations do not affect demand side until a certain level of price as these products are necessity goods. Consumers will be intended to decrease the demand when the price reaches to breaking point and inelasticity of demand will be more elastic. On the other side, demand will stay unchanged when market prices fall because production is made subject to order. Generally the companies prefer to work without stockpile policy. In general market conditions, the products can be seen as substitutes due to government regulations and health policies. Also, a growth in demand for packed products resulted with the augmentation in demand which shows off the complementarity of the products. As stated above as a property of the packaging sector, production size equals the demand size, also assuming that market size is equivalent to production size of the market. Hence, 11.16 Billion USD of estimated market size can also be counted as future estimation of the...
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