Hot Drinks Packaging Market Size & Outlook, 2023-2031

Market Overview

The global hot drinks packaging market size was valued at USD 11.2 billion in 2022. It is expected to reach USD 16.10 billion by 2031, growing at a CAGR of 4.12% during the forecast period (2023–2031). The increasing prevalence of coffee and tea as a fundamental beverage in everyday life is anticipated to continue driving market expansion. Moreover, stricter regulations on certain materials and increased consumer awareness of environmental issues are driving the emergence of new trends in hot drink packaging.

Hot drink packaging refers to the specific materials and containers designed for the storage, transportation, and serving of hot liquids, such as tea, coffee, and similar beverages. This packaging primarily aims to ensure the secure and convenient consumption of hot beverages while preserving their quality, flavor, and temperature. Varying packaging options are employed based on the nature of the beverage, the intended purpose (such as takeout or dine-in), and customer preferences. The primary purpose of packaging is to safeguard the product from harm and captivate customers by enhancing its visual appeal through the application of sophisticated decorative methods, thereby enabling the product to distinguish itself from competitors. Beverage packaging is essential for safeguarding liquids, as they are susceptible to leakage and contamination.

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Market Dynamics

Global Hot Drinks Packaging Market Drivers

Increasing Consumption of Hot Beverages

The increasing worldwide consumption of hot beverages, such as coffee and tea, is a major catalyst. With the growing number of individuals integrating hot beverages into their everyday schedules, there is a rising need for appropriate packaging. In 2024, the projected average volume per person in the Hot Drinks market is 1.93kg. These figures illustrate the global hot drinks industry's substantial financial returns and expansion opportunities.

Moreover, a significant number of individuals find the act of consuming plain hot water or hot lemon water to be comforting and advantageous. Hot water can aid in maintaining hydration and potentially alleviate congestion, enhance digestion, alleviate stress, and provide a sensation of warmth. Such factors drive market growth.

Rise in on-the-Go Consumption

Hot beverage containers with handles, such as travel mugs and disposable cups, are in high demand due to the growing trend of consumers living busy lives and prioritizing convenience. Consumers' mobility has risen as more people have started working from home and others have kept going to the office. Workplaces have begun to provide more flexible work options, including fully remote and hybrid work, which has led to more flexible everyday schedules. These adjustments should increase sales at both high-end dining establishments and fast food chains.

Moreover, products that can be eaten on the move are becoming increasingly common. Customers are searching for food and beverage options that complement their hectic schedules. Therefore, the packaging industry stands to gain from the growing demand for portable hot beverage containers, which will likely fuel market growth.

Global Hot Drinks Packaging Market Restraint

Environmental Concerns and Plastic Usage

Concerns regarding plastic waste and its environmental effects have arisen due to growing environmental awareness. This has led to a change in favor of environmentally friendly substitutes. One major source of plastic packaging production is the beverage industry. The United States alone sells over 35 billion plastic water bottles yearly, the vast majority of which end up in landfills or the natural environment. Despite the sale of over one million plastic bottles per minute, recycling rates for this material remain dismal at just 9% worldwide. Therefore, there is pressure on the packaging industry to use less plastic and switch to sustainable materials, which can present problems in terms of cost and availability of substitutes.

Global Hot Drinks Packaging Market Opportunities

Innovation in Sustainable Packaging

Companies that want to meet the increasing demand for environmentally friendly products can investigate and invest in compostable, biodegradable, or recycled materials. For example, PlasticFri offers a wide range of products with special qualities that distinguish them from conventional substitutes. These products are based on films and fibers. Made from fiber sourced from responsibly managed forests, the PlasticFri Cup is a single-use paper cup that can be used for both hot and cold beverages. These products present significant opportunities for innovation in developing sustainable packaging solutions, creating market growth over the forecast period.

Smart Packaging Technologies

Smart technology integration into packaging can lead to more engaging and improved customer experiences. Augmented reality, temperature indicators, and QR codes that lead to more information are examples of features that can be found on smart packaging. For instance, European fruit juice manufacturer Rauch has new interactive smart packaging thanks to a partnership between digital technology studio Appetite Creative and packaging company Tetra Pak. This smart packaging was launched to support Rauch’s winter drinks theme.

Regional Analysis

Based on region, the global hot drinks packaging market is bifurcated into North America, Europe, Asia-Pacific, Central and South America, and the Middle East and Africa. 

North America Dominates the Global Market

North America is the most significant global hot drinks packaging market shareholder and is expected to expand substantially over the forecast period. The North American hot drink packaging market was the most lucrative and dominant, accounting for 32.16%. In industrialized nations like the US, where coffee and tea consumption is rising, the demand for hot beverages is expected to outstrip supply. The people of the United States drink 400 million cups of coffee daily. An American who drinks coffee alone typically has three cups a day. These numbers add up, given that 150 million Americans drink a lot of coffee. Moreover, prominent companies like Alterra Coffee Roasters and Black Rifle Coffee Company have a large portion of the market and loyal customers, so it's safe to assume this trend will continue.

Furthermore, companies are merging with other market players for sustainable packaging to increase their market share. For instance, TiMELESS, a recently patented Japanese technology, will be marketed in the United States and Mexico by NuZee, a co-packer of single-serve specialty coffee formats and a coffee technology innovator located in Richardson, Texas. According to NuZee, TiMELESS is a novel flexible film sealing technology that does away with the requirement for one-way plastic degassing valves, which are widely used in pet food, coffee, and other industries.

Asia-Pacific holds the largest market share for hot drink packaging due to its rich cultural heritage of tea and coffee traditions. The region's booming middle class, fast urbanization, and teeming population all contribute to the region's demand for hot beverages, which drives the need for creative and eye-catching packaging solutions. Traditional teas like black tea, green tea, and other herbal infusions are preferred in the rich tea-drinking culture of Asia-Pacific. The cultural relevance of these drinks is frequently reflected in the packaging designs. In Asia Pacific, there was a 19 billion liter increase in tea sales in off-trade brewed volume between 2017 and 2022. This is mostly attributable to its strong health positioning, rich tea culture, reasonably priced products, and domestic production. This is expected to propel market growth.

Furthermore, the region's packaging producers are concentrating on creative designs to improve the customer experience. This includes attributes like visually appealing packaging, spill-resistant designs, and easy-to-open lids. For example, Yash Pakka created the Chuk initiative, which produces a food packaging container that is entirely compostable. They currently work for companies like Chai Point, Bikanervala, Haldiram, etc. These containers take a strong stand against plastic containers by having spill-proof lids that fit snugly. They can also be frozen and microwaved, in contrast to plastics. Such factors propel regional market growth.

Segmental Analysis

The global hot drinks packaging market is segmented into products and materials.

Based on product, the global hot drinks packaging market is segmented into coffee, tea, and others.

The coffee segment dominates the global market. Global coffee consumption exceeds 2.25 billion cups daily, making it the world's largest shareholder. Industrialized economies consume the majority of coffee, while developing countries, mostly in South America, produce over 90% of the world's coffee. On a global scale, coffee is a lifeline for 25 million small-scale farmers.

Due to rising coffee consumption in countries like India, China, and Japan, this segment is anticipated to experience the quickest growth during the forecast period. As a result, innovative and appealing packaging solutions are expected to be in high demand. Therefore, companies are creating flexible packaging solutions for this drink, like using cardboard or other recyclable materials, to help customers with the simple takeout process.

Based on material, the global hot drinks packaging market is segmented into glass, plastics, and others.

The glass segment owns the highest market share. Most glass is used to make bottles and jars. Glass possesses aesthetic appeal and reusability. The flavor or aroma of coffee will not be affected by glass as it does not absorb any chemicals. Double-walled glass cups are recognized for preserving a consistent beverage temperature. Their main disadvantage lies in their limited heat retention. However, more and more varieties are swarming to different products that have the potential to increase market share.

For instance, borosilicate glass is capable of withstanding temperatures as high as 450 degrees Celsius. Soups, sauces, and hot beverages are all perfectly fine to use with this because of this. The material's low rate of thermal expansion guarantees that abrupt temperature changes won't cause it to break or fracture. This is expected to propel market growth.

List of key players in Hot Drinks Packaging Market

1. Bemis Company Inc.
2. Alcoa Corporation
3. Sonoco Products Company
4. Crown Holdings Inc.
5. Saint-Gobain S.A.
6. Amcor Ltd.
7. Reynolds Group Holdings Limited
8. Stora Enso
9. Mondi PLC.
10. Tetra Laval International S.A.

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Recent Developments

• May 2023- BASF introduced a certified home and industrial compostable grade specifically designed for hot and cold food packaging as part of its ecovio® line of extrusion coatings for paper and board. The latest extrusion coating grade, ecovio® 70 PS14H6, has temperature stability up to 100°C, is food-contact approved, and exhibits great barrier properties against liquids, lipids, grease, and mineral oil.
• June 2023- UK-based food packaging supplier Celebration Packaging introduced a new eco-friendly bamboo fiber hot drink cup line.