High demand must ensure packaging margin gain

In the face of signs of resumption of economic activity this year, the packaging sector is preparing for an increase in demand. It is expected that the growth of orders can guarantee, including, a recomposition of margins for manufacturers.
In the last four years, the packaging segments suffered the consequences of the economic recession, generating retractions of production in all its branches. "We're in a recovery, shed with very positive prospects for 2018", says the Executive Director of the Brazilian packaging Association (Abre), Luciana Pellegrino. Her assessment is that the industry follow the positive dynamics presented since the end of last year by retail, ensuring "effective resumption", even with the policy challenges on the eve of the presidential election.
According to her, the improvement of employment and the return of consumer confidence will determine the rate of progression of the sector in 2018. "We are less impacted by increased lending and more by the expansion of income, since 70% of our packaging for nondurable products, such as food, cosmetics, pharmaceuticals and cleaning," he says.
As the Economist and partner at consulting indestructible generator, Fabio Silveira, this year should mark a resumption of economic activity, with increased volume and prices in the packaging industry. "It will not be a price via high cost of production, which should remain relatively stable. There may be some high punctual, because of oil, but nothing. The industry is going to have a rate increase by high demand [packaging], "said the Economist.
Sen adds that this increase in demand for packaging will allow industries still a room for recovery of margins. "After three years, companies will try to raise your profit margin. It's not going to be a great improvement, because there is an explosive recovery in demand, but will guarantee an improvement in profitability, "strengthens.
Even slow, the recovery observed since last year already shows results. In September 2017, for the first time since October 2013, Open your swing in two consecutive months of high production. Between January and September, the volumes produced grew 0.27 percent over the first nine months of 2016. Given this result, the Association already projects a growth of 0.6% for the sector in 2017, up from the previous estimate, which was 0.1% (estimated through the month of June).
While in the first half of last year was decrease of 0.65%, in the second half of 2017 the expansion came to 1.9%.
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Among the major segments of the packaging industry are the plastic materials, with about 39% of the revenue of the sector, in a consolidated manner, R $70.4 billion in 2017, according to estimation of the Open. Then appear metal packaging, with 18.1% of representativeness, followed by (17.3%), corrugated cardboard and cardboard (11.5%), paper (5.1%) and glass (4.4%). The Open Executive reveals that, in 2018, the metal packaging-related segments, such as those used in drinks, should gain momentum, together with the related to personal hygiene, perfumery and cosmetics – especially glass-and pharmaceuticals, for playing card. In relation to plastics, Luciana avoided making predictions, since it is an area very sprayed. "In this case, there is a very particular dynamics for each product."
Yesterday, the Brazilian Association of corrugated board (ABPO) disclosed that sales of corrugated board used in packaging-boxes, accessories and plates – rose 3.91 percent in December compared with the same month of 2016, with two working days less, to 275,953 tonnes. In this way, the volume issued ended 2017 with 4.92% advance before 2016, totaling 3,501,000 tons.
The President of Brazilian Steel Packaging Association (Abeaço), Thais Fagury, the volume of steel used in Brazil for packaging should add, this year, about 400,000 tons, compared with 380,000 tons in 2017 and 378,000 tons of 2016. According to her, the cans for food segment featured a more stable performance during the worst times of economic recession. However, if realized during this period a large process of migration of packaging types. She cites as an example the sauces ready, in about 90% of the market has migrated to flexible. "The canned sauces were concentrated on premium products. This was the search for lowest prices of packaging, "explains. According to Thais, while the cans intended for items such as powdered milk, canned corn and peas or canned fruit had production your practically stable in the past year (with an expansion of less than 2%) stood out the 5% increase of packaging destined for tuna.
In relation to costs, she downplayed the impact of the recent price adjustments announced by the power plants in Brazil, stressing that the transfers of this input should affect most other industries, such as auto.