US tariff policies could reshape the global packaging industry, with potential impacts reaching into the tens of billions of dollars, according to a new white paper from Smithers.
The white paper, titled Impact of Tariffs on Packaging, projects that global packaging demand will reach $1.52 trillion by 2030, but warns that growth could slow by up to 0.5 per cent under pessimistic scenarios.
Global packaging demand is set to hit $1.52 trillion by 2030, with growth rates of 3.8 per cent in the Smithers baseline scenario; it may rise to 3.9 per cent in the optimistic scenario or drop to 3.3 per cent in the pessimistic scenario.
Tariffs are expected to impact US economic growth more than the global market in the short term, but a recovery is expected in later years.
The white paper finds that depending on the scenario, US packaging consumption in 2030 could range from $255.4 billion to $279.6 billion, a swing of over $24 billion driven by tariff-related uncertainty.
Segments such as rigid plastics and flexible packaging, which are heavily reliant on imports, are expected to face the sharpest cost increases, although demand remains resilient due to their essential role in food and healthcare.
Despite economic pressures, healthcare packaging is forecast to grow at 3.1 per cent CAGR in the US, while cosmetics packaging benefits from the “lipstick effect”, with consumers maintaining spending on small luxuries.
The white paper also finds that brands and converters are increasingly adopting a “Plus One” strategy, diversifying their sourcing beyond China to mitigate future trade risks, with Southeast Asia and Latin America emerging as key alternatives.
For the white paper, Smithers built three robust scenarios (baseline, pessimistic and optimistic) to assess the impact of tariffs on key packaging materials, end-use markets and geographies.
Primary and secondary research was built on top of the Smithers in-house database to develop the data for each key scenario. Every step was assessed by the Smithers team of packaging subject matter experts. The core economic assumptions utilised IMF and USITC data.
