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Demand for packaging is expected to move through three phases during the coronavirus pandemic, according to a report from consultancy McKinsey titled 'How the packaging industry can navigate the coronavirus pandemic'.

The authors expect the impact of the crisis on the packaging industry to be mixed, with some sectors seeing a dramatic increase in demand, and others the opposite.

“The impact on packaging players will depend on their portfolios and exposures to different regions, end uses for packaging, and substrates,” the report reads.

The first of the three phases the report predicts industry will go through during the pandemic period is a time of initial shock. The report authors say the phase typically lasts four weeks but can be longer.

In this phase, the report predicts a sharp increase in demand in the food, healthcare, and e-commerce sectors. But, at the same time demand for packaging in the luxury, B2B transport, and industrial sectors could see a decline.

The authors point out that the packaging industry has exposure to secondary effects triggered by the pandemic, such as the cost of raw materials and problems with international trade.

The second of the three phases described in the report covers when the pandemic has been brought under control.

“Reduced household disposable income and weakened corporate balance sheets are expected to lower demand across most end-use segments for packaging, with the exception of healthcare and certain food categories,” the report reads.

The authors expect some consumer behaviours like stockpiling, will slow down, while others, such as e-commerce purchasing, will speed up.

Finally, the third phase is the rebound. The authors expect to see demand for packaging gradually return, with some sectors going faster (such as food service packaging), and others will see a slower recovery (like luxury goods, travel, and hospitality).

The full report can be accessed on McKinsey’s website.

It was authored by:

  • David Feber, partner in McKinsey’s Detroit office
  • Daniel Nordigården is an associate partner in the Detroit office
  • Oskar Lingqvist is a senior partner in the Stockholm office

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