The report forecasts the global synthetic paper market to grow at a CAGR of 6.63% during the period 2016-2020.
The rising internet penetration and the increasing trend of online buying will boost the global synthetic paper market during the forecast period. Over 40% of the global population has internet access, and the percentage is increasing rapidly, giving more people access to online shopping.
According to the report, during the forecast period, the demand from different segments of the beverages industry such as milk, juices, and water will be the key driver of the HDPE synthetic paper packaging market. Vendors use eye-catching labels in beverage packaging to make the products stand out. Beverage labeling solutions with sophisticated decorations in alcoholic beverages and high-end soda bottles stand out on retail shelves.
Further, the report states that the launch of new synthetic paper lines requires massive investment. Synthetic paper lines have different lengths and widths, so new machinery and processes are required for each line. For instance, the total cost of machinery and equipment costs 65% of the total fixed costs. The recurring costs required for the maintenance of these machines also add up to the cost of production of synthetic paper. Vendors in the market need to have large production plants or product lines to meet the increasing demand. Clients partner with vendors that have large production facilities to support their volume requirements. This favors the major players in the market because of their continuous capital investment in the development of production plants. Investing large amounts of capital to purchase or extend existing production facilities and the additional expenditure associated with developing new plants are challenges for small players in the global synthetic paper market.