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Convenience, smaller portions to boost cup and lid demand

Freedonia study projects cup and lid market demand to expand 3.9% annually to reach $10.6 billion by 2020.

Freedonia study projects cup and lid market demand to expand 3.9% annually to reach $10.6 billion by 2020.
Freedonia study projects cup and lid market demand to expand 3.9% annually to reach $10.6 billion by 2020.

Food trends that favor convenience and smaller portions are expected to drive growth in cup and lid market demand, according to a new Freedonia “Cups & Lids” study.

The international industrial market research company says gains will be supported by the growing focus on specialty beverages among foodservice operators and the expansion of food menus to include soup, oatmeal, and other sides.

Freedonia also expects consumer preference for premium coffee and fruit beverages will bolster value gains as these drinks typically use more expensive cups and lids to accommodate whipped toppings or showcase the beverage’s color.

Packaging cups, the study notes, will post the fastest gains through 2020, primarily due to the fact that products packaged in cups typically are smaller portions, positioned specifically to appeal to the time-conscious consumer.

Freedonia Analyst Katie Wieser says, “As it becomes more common to snack throughout the day rather than prepare meals, healthy foods that are pre-packaged and portable will continue to gain favor.”

That, says the research firm, can also drive revenues for food manufacturers, as it allows items to be sold at a premium. Fresh fruits and vegetables have seen some of the largest gains attributable to this trend. Cups used for coffee and tea will see the fastest growth of any major packaging market, and cups for dairy products will continue to show favorable increases due to the popularity of premium yogurt.

In the beverage arena, Freedonia reports drinking cups made of paper, plastic, or foam hold the largest share of this market. Gains for drinking cups will be slightly smaller than the cup and lid average due to the maturity of many applications. However, demand for hot beverage cups will see gains, driven by the popularity of premium coffee and the use of high-value insulated paper cups.

Sustainability is playing a role in the changing mix of raw materials during the past decade, says Freedonia, as some foodservice chains have transitioned away from polystyrene foam and some cities have introduced bans on the sale or use of this material.

The survey indicates the largest beneficiary of these changes has been the paper cup, which is expected to show the fastest gains through 2020 and will continue to hold the largest share of the drinking cup market. There has also been wider use of clear plastic cups, which allow for greater visibility of the beverage.

The 218-page Cups & Lids report is available for $5,300. Contact Corinne Gangloff by phone at 440/684.9600 or email p[email protected].

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