Market Overview

Domestic paper bags market in FY2017 achieved 14,876,760 thousand bags (increased by 3.0% from the previous fiscal year) based on the sales volume at converters. The target product types in this research are carry bags, square bottom bags, and flat bags, and the sales volume of the flat bags used for food wrapping is on the rise at high growth rate in recent years. Such increase is leading the expansion of the paper bags market.  As the trend continued in FY2018, size of the paper bags market by sales volume is projected to expand to 15,245,000 thousand bags (increased by 2.5% from the previous fiscal year).

Meanwhile, for the other two product types, the downturn has ceased for the carry bags but not for the square bottom bags. While the flat bags are used as a primary wrapper for food field, carry bags and square bottom bags are mostly used as a secondary wrapping, the demand of which is influenced by the trend to ‘reduce packaging waste’. However, the negative factor that affects the most is the replacement to other materials: Although the trend seems to have passed its peak, a shift to inexpensive PE bags (polyethylene bags), especially, is still continuing. 

 

Noteworthy Topics

Will “Plastic Free” Lead to Demand for Carry Bags and Square Bottom Bags?

In 2018, as awareness on marine pollution caused by plastic litters (microplastic pollution) increases globally, the “plastic free” movements have accelerated in many countries. Meanwhile, until recently, the issue of disposable plastics had not been taken as an urgent matter of concern in Japan. Nevertheless, under the criticism on the country’s essentially low recycling rate and as China banned the import of plastic wastes in January 2018, the issue became considerably pressing in Japan as well, leading to the rising awareness to “plastic free”.


Under such circumstances, the Japanese government drew up a “strategy for the recycling of plastic resources”, promoting reduction of plastic waste by obligating retailers to charge fees for plastic shopping bags. The plastic bag charge system will be applied to the retail stores such as supermarkets, and is likely to start from April 2020.  To achieve the goal of the reduction strategy, the Ministry of Environment has announced to set the plastic shopping bags, a ’symbol’ of disposable plastics, as a primary target. Implementation of the policy creates alternative demand for PE bags, possibly leads to the rise in the demand for the paper bags. 


 

Future Outlook

Size of the domestic paper bags market in FY2019 is projected to reach 15,700,000 bags, increase by 3.0% from the previous fiscal year. Sales volume is expected to expand further for the flat bags, while it stays almost flat for the carry bags and the square-bottom bags as “plastic free” gathers momentum.


An assumption on the market growth of the flat bags is to continue expanding from the medium- to long-term perspective as well. For the carry bags and square-bottom bags, the alternative demand created for PE bags may lead to the upward turn; however, because the bioplastics may increase its presence as a material which competes with paper, the level of growth may remain limited.


 

Research Outline