The Rise of Malaysia Corrugated Packaging Industry
Malaysia has seen tremendous growth in the usage of corrugated packaging over the past decade, primarily due to the growth of the e-commerce industry. Corrugated packaging is the most widely used form of packaging for shipping goods and products due to its durability, cushioning ability and sustainability. As more businesses shift to online sales channels, the demand for corrugated boxes and containers has skyrocketed in the country.
Traditionally, Malaysia Corrugated Packaging was primarily used for transporting goods from manufacturers to retailers. However, the emergence of online shopping has expanded its usage for packing individual customer orders as well. E-commerce players require a reliable and cost-effective form of packaging that can protect products during the shipping process. Corrugated packaging fits this need perfectly due to its robustness and affordability.
Growth of the Logistics and Warehousing Sectors
Another major factor contributing to the higher consumption of corrugated packaging in Malaysia is the growth of the logistics and warehousing industries. As domestic and international trade increases, companies are investing heavily in supply chain infrastructure like warehouses, distribution centers and transportation fleets. This allows businesses to efficiently store, process and deliver large volumes of goods within Malaysia and for exports.
Warehouses now play a crucial role in consolidating shipments, sorting packages by destination and preparing orders for last mile delivery. All incoming and outgoing inventory movements at these facilities rely on corrugated boxes and containers. Advanced warehousing technologies like automated storage and retrieval systems have also increased the scale of operations, translating to higher packaging material utilization.
Leading logistics providers like POS Malaysia, GDEX, MHE-Demag and others have expanded their nationwide warehousing networks in recent years. This expansion coupled with growing e-commerce volumes has created strong ongoing demand for corrugated packaging from third party logistics companies as well.
Key Manufacturers Lead Production Growth
In response to the surging demand, domestic corrugated packaging manufacturers have significantly scaled up their production capacities. Some of the largest players in the Malaysian market include Lingkaran Trans Kota Holdings, Vivocom International, Landmark Resources and Ekoflitz Packaging.
Lingkaran Trans Kota Holdings (LTK) operates two of the largest corrugated plants in the country located in Kuala Lumpur and Johor. In 2021, LTK invested RM110 million to upgrade its facilities and add new production lines, doubling its overall annual capacity to 260,000 tons.
Another major manufacturer Vivocom International has four integrated corrugated packaging plants across West Malaysia and Sabah. In 2020, Vivocom completed a RM50 million expansion at its Pasir Gudang plant, increasing its monthly output by 30%.
Such heavy investments clearly display the manufacturers’ optimism about ongoing and future demand prospects. They are well-equipped to support marketplace requirements for corrugated boxes from a host of industries including F&B, consumer goods, electronics and more.
Innovations in Design and sustainability
To stay ahead of competition, Malaysian corrugated packaging producers are bringing new design-driven innovations as well. Eco-friendly features like the use of recycled paper fibers and soy-based inks allow manufacturers to market Green Packaging options.
Advanced digital printing technologies have enabled custom graphics, colors and product information to be printed directly onto corrugated boards. Combined boxes and displays that double as marketing collaterals are gaining popularity. Innovations in forming, cutting and gluing machinery support faster production throughput and cost efficiencies too.
Legislation and Subsidy Support
The Malaysian government has identified logistics and packaging as two focal areas for economic growth. Supportive policies incentivize local manufacturing expansion and new technology adoption. A tax exemption of 70% on imported capital equipment encourages capacity upgrades.
Various subsidy programs offer aid for R&D, product certification, talent development, environmental compliance and market development activities. This helps the industry boost competitiveness and unlock export potential. The Malaysian Investment Development Authority actively promotes the industry through initiatives like trade shows and buyer-seller matching platforms.
With strong foundations laid by the proactive government and growing end-use sectors, the Malaysian corrugated packaging industry looks well-poised for continued advancement. Expanding production capabilities and innovations are positioning manufacturers to seize untapped prospects within and beyond the country’s borders.
Future Prospects
Going forward, analysts project Malaysia’s corrugated packaging consumption to multiply over the next 5 years, driven primarily by:
– acceleration of e-commerce activities boosted by increasing internet and smartphone penetration
– expansion of strategic government projects like the East Coast Rail Link megaproject and Bandar Malaysia development which will drive infrastructure and construction activity
– favorable trade agreements unlocking potential in higher-growthASEAN and Asian export markets
– greater penetration into packaged food, fast moving consumer goods and industrial packaging segments with rising incomes and urbanization
– adoption of advanced production technologies to meet performance/design needs of new industries like medical devices, electric vehicles etc.
In Summary, barring any major economic slowdowns, the Malaysia corrugated packaging industry will play a vital role in enabling growth across the country’s manufacturing and logistics ecosystems. With the right investments and market strategies, local manufacturers are well-positioned to emerge as regional leaders.
*Note:
1.Source: CoherentMI, Public sources, Desk research
2.We have leveraged AI tools to mine information and compile it
