MANILA, Philippines - The Philippine packaging industry will also take a hit from the new coronavirus disease 2019 or COVID-19 that is hounding the manufacturing sector in Asia.

Angel Buaag, managing director of investment consultancy firm Investor Relations Global Inc., said "it will be good especially for the packaging sector to prepare for 'headwind' forecasts since we know that the packaging industry is practically involved in most other industries." Buaag made the observation in a recent talk at a conference hosted by ProPak Philippines and the Department of Science and Technology at the World Trade Center.

ProPak is the association of packaging manufacturers and suppliers in the Philippines. IRG expects the economic downtrend to affect the packaging industry's critical role in market supply and demand as the COVID-19 epidemic is already creating uncertainty in the global business.

He cited reports that the automotive industry had taken a hit with the world's most productive car factory, South Korea's Hyundai, suspending operations at its big Ulsan complex crippled by a lack of parts after the coronavirus outbreak paralyzed China's industrial output. The packaging sector counts the automotive industry as a key customer, but the food industry serves as its major partner in the business.

The food packaging industry has increased its share to more than one-third of the worldwide packaging market valued at $876 billion in 2018. "From paper and paperboard to plastics to flexibles, there are as many kinds of packaging media as there are manufactured goods and this results in the parallel dynamic growth of both the manufacturing and packaging industries," Buaag said. "The question of food supply and demand will be a challenge to both the manufacturing and packaging sector.

Consumer spending may take a dip no matter how shallow and the sourcing of raw production materials may be difficult as unavailability and rising costs may be the rule of the day," he warned. To address the risks created by an abnormal occurrence of several calamities like the Taal Volcano eruption and COVID-19 as well as global trade disputes, Buaag said industries must evaluate their multi-stage product and packaging development projects and promptly adjust to the situation.

Narrowing down the product and packaging media selection to the most sought after in the market, for instance, could suffice to meet the right economies of scale with less inventory piling up, he said.

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