History and Growth of Malaysia Corrugated Packaging Market
The corrugated packaging industry in Malaysia traces its roots back to the 1970s when the first corrugated box manufacturers were established to support the growing export-oriented manufacturing sector. In the initial decades, the production was mainly focused on meeting domestic demand. However, since the 1990s, Malaysia has emerged as an important exporter of corrugated packaging products to other Asian markets as well as countries in the developed world. Several leading international corrugated packaging companies set up manufacturing plants in Malaysia during this phase of growth to capitalize on its strategic location, lower costs of production and a business friendly environment.
By the early 2000s, Malaysia had developed a sizeable domestic Corrugated Packaging industry catering to diverse end-use sectors ranging from electronics to automotive to food & beverages. The abundant availability of raw materials like kraft liner and kraft medium within the country supported indigenous production. The industry also gained strong technological capabilities through transfer of know-how and best practices from international partners. This helped Malaysian corrugated packaging manufacturers to consistently improve product quality and achieve higher productivity levels at par with global standards.
Market Size and Major Players
According to industry estimates, the Malaysian corrugated packaging market was worth over RM5 billion in annual revenues by 2019. This market has grown at a compound annual growth rate (CAGR) of close to 6% over the past decade backed by rising demand from both export-oriented manufacturing industries as well as the expanding domestic consumer sector.
Some of the leading players in the Malaysian corrugated packaging industry include Daifuku Packaging Sdn Bhd, Packworld (M) Sdn Bhd, Ee Chuan Multiple Industries (M) Bhd, Evergreen Packaging Sdn Bhd, and PPT Paper Sdn Bhd. They command a major share of the market through an extensive pan-Malaysia production and distribution network serving many multinational companies across diverse manufacturing verticals. International players like DS Smith Packaging, International Paper and Smurfit Kappa also have a prominent footprint through their local manufacturing joint ventures and subsidiaries.
Malaysia Corrugated Packaging Market as an Export Hub
With large-scale automated facilities and strong supply chain competencies developed over the years, Malaysia has emerged as a leading exporter of corrugated packaging solutions to various Asian and global markets. The fact that Malaysia has free trade agreements with over 20 countries gives its manufacturers tariff-free access to a huge customer base. Key export destinations for Malaysian corrugated packaging products include Singapore, Indonesia, Vietnam, China, India, Australia, Middle East and some European countries.
According to the Federation of Malaysian Manufacturers (FMM), Malaysia’s annual exports of corrugated packaging and boxes stood close to RM2.5 billion in value terms in 2019. This export volume has multiplied almost five times in the last fifteen years showcasing the stronghold Malaysia has gained as a reliable supplier of best-in-class corrugated packaging solutions to global customers. Leveraging competitive advantages like relatively lower production costs compared to developed nations, the Malaysian corrugated packaging export sector is well-positioned for sustained growth over the coming years.
Technological Advances and Sustainability Measures
In order to stay ahead of competition and meet evolving consumer preferences, Malaysian corrugated packaging manufacturers have embraced new-age technologies in their operations. Installation of advanced packaging line machinery along with computer control systems has helped in optimizing efficiency and automation levels at plants.
Adoption of Industry 4.0 solutions involving industrial IoT, data analytics and robotics is gradually increasing productivity, while minimizing human dependency. On the sustainability front, many players have made noteworthy progress in utilizing recycled fiber, adopting renewable energy sources as well as employing eco-friendly production practices. A noteworthy trend is the increased focus on developing customized corrugated packaging solutions using innovative design software to meet industry-specific requirements more effectively.
Outlook and Future Opportunities
Going forward, with an appreciating consumer class driving domestic sector growth and new free trade pacts opening up global market access, the long-term business prospects for the Malaysian corrugated packaging industry appears very promising. Expanding manufacturing capabilities as well as developing niche applications through value-added product range will help reinforce Malaysia’s leadership position in Asian and international markets.
In Summary, concerted efforts are needed to strengthen the circularity of the value chain through enhanced fiber recycling programs across cities. Attracting more technology providers to set up innovation centers locally could further stimulate technological upgrades, productivity enhancements and new product offerings catering to Industry 4.0 transformations in end-use verticals. If supported by continuing policy reforms and infrastructural developments, the Malaysian corrugated packaging industry is all poised to scale new heights of success over the next decade and emerge as a global force to reckon with.
*Note:
1. Source: Coherent Market Insights, Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it
