Investment in the Russian packaging industry on the rise again

Russia is one of the TOP 20 consumer goods markets worldwide, and with about 143 million consumers, it is an important market, especially for the food and beverage industry. Domestic consumption benefits from the fact that the middle class is growing steadily and the population’s consumption patterns and consumer habits are changing noticeably. There is evidence of a marked change in direction, in particular when it comes to food and beverages, with processed and packaged food as well as convenience products gaining increasing popularity. Demand for such products is also on the increase due to the continued spread of super- and hypermarkets, which are now gradually becoming established in medium-sized towns.

Packaging plays an important role in this market, not only acting as a protective container for storage and transportation, but also for the marketing and presentation of products. It is not just suppliers of product- and customer-friendly packaging creations who benefit from this development, but also manufacturers of packaging machines and packaging. National and international producers are investing in modern, flexible plant and in packaging materials to meet the rising expectations.

These good conditions formed the backdrop for UPAKOVKA/UPAK ITALIA, leading Russian Trade Fair for Packaging Machinery, Packaging Production and Packaging Material, which took place in Moscow from 24 - 27 January 2012. The exhibitors had a busy few days at the fair, during which the trade visitors from the packaging industry came specifically to find out about new developments in the industry. All of the companies represented reported that they had made good contacts, with a very encouraging number of new customers and promising negotiations. About 20,000 visitors from throughout Russia and many of the GUS countries came to the SAO Expocentr in Krasnaya Presnya to attend UPAKOVKA/UPAK ITALIA and INTERPLASTICA, the International Trade Fair for Plastics & Rubber, which was held in parallel to it. Erhard Wienkamp, one of the managers of Messe Düsseldorf who is responsible for all of the foreign trade fairs, was very pleased about the large number of satisfied customers. “This was the 20th time that UPAKOVKA/UPAK ITALIA has taken place in Moscow and it has become the leading platform for a dynamic industry. The trade visitors know that there is no other event in the whole of Russia where they can get such a complete overview of what is available internationally and this is the only place where they will get the opportunity to experience innovative systems in operation. Anyone investing in the Russian packaging industry comes on an information gathering mission to UPAKOVKA/UPAK ITALIA first!”

Dr. Guido Corbella, CEO of Centrexpo, shares this opinion. “Exhibitors come here to present top class technology, because they know that UPAKOVKA/UPAK ITALIA is the place to meet the right customers for their products and services. Being part of this fair is still the best way to establish or build on business relationships in Russia and the entire GUS – in a market which companies still view as very promising, which is why the number of Italian exhibitors has remained stable, despite the fact that, for the first time ever, we didn’t receive any government support, following the temporary dissolution of the Italian Institute for Foreign Trade. This clearly goes to show how important the Russian market is for Italian companies, and will continue to be – many of the companies have already expressed their interest in exhibiting at UPAKOVKA/UPAK ITALIA again in 2013. We particularly anticipate growth in the area of converting and packaging printing, where we see great opportunities in the future.”

The largest exhibitor contingents are from Russia, Germany and Italy, with over 300 exhibitors from 22 different countries represented. The trade relationships, in particular between German machine manufacturers and the Russian packaging industry, go back a long way. Almost half of all packaging machines and as many as two thirds of all confectionery machines are made in Germany, and the vast majority of brewing equipment also comes from Germany. Vera Fritsche from the Food Processing and Packaging Machinery Association, a division of VDMA expects the excellent business relations to improve yet further in the years ahead. “German engineering and German know-how help Russia to modernise and expand its industry. With Russia joining the WTO, Russian manufacturers face stronger competition. In order to be able to withstand this competition and, over and above that, open new export markets, they need to invest in production technology and capacity.” Following a drop in demand as a result of the global financial and economic crisis, we saw business recover significantly in the past year: German manufacturers exported packaging machines worth some €266 million to Russia in the first eleven months of 2011 (an increase of 28% compared with the same period in the previous year) as well as confectionary machines worth €51 million (an increase of 11%).

Alexander Puzikov, President of the Russian packaging machinery association Packmash, was thrilled to see that Russian vendors were presenting technically innovative machinery and equipment. “The packaging machine sector is still in its infancy in our country, with most of the companies having been founded in the ‘90s. Domestic participation in UPAKOVKA/UPAK ITALIA has now increased significantly and the progress that the products have made is impossible to overlook.” Alexander Boiko, President of the National Confederation of Packagers of Russia NKPak, also expects growth prospects for the packaging industry in Russia to remain buoyant. “The trend has definitely been reversed since the recent crisis, during which cutbacks were also made when it came to packaging. The sector is once again seeing growth of around 6% per annum, and packaging is becoming more sophisticated again. Plastics have now overtaken cardboard packaging and film packaging is still on the increase, too.”

The next UPAKOVKA/UPAK ITALIA is scheduled to take place from 29 January – 1 February 2013 in Moscow and will once again be held in parallel with INTERPLASTICA. The spotlight at next year’s fair will be on the finishing of packaging materials and packaging, packaging manufacturing technologies and packaging printing, which also took the limelight this year. Demand in this segment is growing fast in Russia, not least due to new regulations governing the labelling and identification of products.

Source: Messe Düsseldorf