Cups & Lids

US cup and lid demand to reach $7.8 billion in 2012 Demand for cups and lids is projected to reach $7.8 billion in 2012. Gains will be driven by continued growth in consumer spending and a favorable outlook for foodservice revenues. Cup and lid demand will also gain momentum as a result of competitive strategies involving expanded varieties of beverages in quick service restaurants, coffee and snack shops and convenience stores.

Lids to outpace cups Growth in lid demand will outpace cup demand, the result of an increasing percentage of drinking cups using lids, growing demand for highervalue specialty lids and continued solid advances for singleserving packaging cups. The increased level of cups with lids will be driven by the rising volume of beverages purchased for offsite consumption as well as the trend in a growing number of restaurants to put lids on all disposable cups for safety reasons.

Packaging cups will register aboveaverage gains, fueled by consumer demand for convenient and portable singleserving meal and snack options, which will lead to an expanded range of applications. Drinking cup and lid prospects will benefit from heightened demand for larger cups and specialty lids.

Growing demand for environmentally friendly cups, such as compostable cups or recycled content cups, will aid value gains as these cups tend to be higher in price than conventional cups.

Trends toward healthier eating, growing interest in caloriecontrolled servings and increased targeting by product manufacturers of specific demographic groups, such as women and children, will also stimulate opportunities for packaging cups. At the same time, competition from alternative packaging media, such as pouches, in products such as yogurt, condiments and dry snack foods, will limit advances to some degree.

Foodservice to remain dominant market The foodservice market, which represented over 70 percent of demand in 2007, will remain the dominant cup and lid market. Growth will be propelled by expanded drink offerings in quick service and other restaurants that use disposable cups; rising sales of breakfast in quick service restaurants and convenience stores; and the importance of custom printing on cups. Moreover, the growing emphasis on premium coffee in quick service restaurants and convenience stores will boost cup and lid prospects, both in terms of increased coffee sales and the use of more costly cup and lid types to support perceptions of quality.

Good opportunities will also exist in the coffee and snack shop segment, where highervalue paper hot cups and specialty lids are common. However, decelerated consumer spending and competition from other venues offering specialty coffee will temper prospects.

The retail market will benefit from the increased availability of environmentally friendly products, such as those with recycled content or produced from degradable materials, along with trends toward increased athome casual entertaining.

Study coverage This new Freedonia industry study, Cups & Lids, is priced at $4600. It presents historical demand data (1997, 2002 and 2007) plus forecasts for 2012 and 2017 for by product type (e.g., drinking cups, packaging cups, food cups, portion cups, drinking cup lids, flexible lids), material (plastic, paperboard, foam, metal and foil) and market (e.g., foodservice, food packaging, retail). The study also considers market environment factors, evaluates company market share and profiles leading competitors.