2025 Packaging Trends for the Food and Drinks Industry

Throughout the 20 years of supporting our clients and partners with their packaging requirements, we have noted many trends and events impact on businesses around the world. With this amassed experience and knowledge of the market, we have put together our predictions for the year ahead. It is sometimes impossible to predict exactly what might happen in the future (COVID-pandemic anyone?!), although here are some trends we think it’s worth being aware of that may bring both challenges and opportunities to food and drinks industry businesses…

The Trump Effect

Tariffs on imports were a central promise in the 2024 Trump campaign. This could influence shipping activities, where we may see a rush to import goods from some countries before tariffs are increased.

This in turn may have a knock-on effect to some other routes as ships may be diverted to benefit from more revenues elsewhere.

We may also find geographical changes in supply, as there is a lot of talk of moving goods from China to Turkey or other countries. This may result in possible disruption due to changes in supply sources.

Shipping

Far East shipping is currently trending down, however the Trump effect may change this, depending on his decisions this year.  As shipping remains a tricky area to predict, ensure that you are covered on your key routes as we may see some sudden movements based on macro changes in USA (tariffs) / China (reduction of exports) / Russia (end of the war) and EU (possible recession). Intra Europe shipping currently seems more stable!

Macro

The Eurozone is currently underperforming, largely due to Germany’s weakening economy, job losses and increased competition from China in sales of plug-in hybrid vehicles.  In fact, according to RT.com, “the German economy is on course for its longest post-war recession, with a third consecutive year of contraction projected for 2025”. We may see a large sneeze from the EU, thus potentially pushing Europe into a recession.

Glass

Expect some further closures as older furnaces are not renewed due to a lack of demand. Underlying costs won’t allow glass makers to provide continued discount, so whilst there may be some temporary discounts from some suppliers, this will not be sustainable in the longer term.  With around 35% of the cost of manufacturing glass being energy, in general, a small move in energy prices has a large effect on the glass cost.

Glass factories are expensive to build, and hence, high borrowing may be required. Recent higher interest rates favour those with lesser debt, so beware of highly geared glass factories with a lot of debt selling cheap glass.

The current lower shipping costs are allowing imports from China, India and, to a lesser extent, elsewhere. However, beware of shipping over longer term contracts that can influence the cost of the product over time.

Extended Producer Responsibility

The UK government has introduced new measures for businesses who supply packaged products into UK households, including data reporting and modulated fees. From 2025, companies that are in scope of the legislation will need to pay fees based on the volume of packaging they put on to the UK market and how easy it is to recycle. The legislation is expected to add £2bn of extra costs associated with packaging to UK businesses’ costs.

We predict there will be a focus on reducing and removing pieces of packaging as businesses look at ways to reduce their exposure to the new fees.

Businesses will target removal of any unnecessary packaging from products where it does not affect the quality or food waste. For example, companies may remove labels in favour of pre-printed packaging.

There will also be continued focus on light weighting packaging and increased recyclability. Light weighting is where lighter materials are being used to reduce shipping weight and material usage without compromising on the quality or durability.

In Summary

Whilst 2025 may produce many uncertainties in the market due to macro and geopolitical factors, there are also opportunities to be found.  Businesses that look to increase the sustainability of their packaging, in terms of materials or light weighting, may benefit from lower fees whilst appealing to the ever-rising eco-consciousness among consumers and contributing to a more sustainable future.    

This article was compiled by Aegg Creative Packaging, packaging partners to food and drink manufacturers as well as food outlets across the UK. 

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