Smithers’ analysis on track and trace packaging

Supply chain security has emerged as a business priority in the wake of the global pandemic, with many companies now keen to leverage smart packaging and coding print to enable more efficient, dynamic and responsive logistics.

According to a recent research by Smithers, the combined market value of taggants, RFID antennas, and coding print has increased by 76% during 2017 and will be worth USD 1.6 billion in 2022. This study shows not just two years of disruption, but also a fresh understanding of the benefits of item-level tracking.

Traceability features, including item-level tracking, are already mandated in higher-risk segments, mainly pharmaceuticals and medical devices. Smithers' in-depth commercial and technical investigation shows the upward trajectory is in no danger of plateauing.

The market is said to experience a compound annual growth rate (CAGR) of +9.5% through 2027, yielding a total value of USD 2.5 billion in that year. Healthcare will remain the biggest end-use market as mandated track-and-trace systems proliferate worldwide, with their value doubling between 2021 and 2027.

In higher-risk industries, namely those dealing with medicines and medical equipment, traceability capabilities, including item-level tracking, are already required, the report found. In-depth commercial and technical analysis by Smithers reveals there is no risk of a plateau in the current trend.

“Through 2027, the market will increase at a CAGR of 9.5%, reaching a total value of USD 2.5 billion. As mandatory track-and-trace systems grow globally, with their value tripling between 2021 and 2027, healthcare will continue to be the largest end-use market,” the report stated.

In the track-and-trace industry, active RFID tagging on industrial and transportation packaging will continue to be the most profitable segment. The need to build resilience and flexibility for the future will persist even when it completely fades. The US Food and Drug Administration (FDA) has promised to use technology to support more intelligent food supply chains, allowing for digital product recalls to happen in a matter of minutes rather than months.

In the short term, the market will rely on coding print where there will be a wider interest in on-pack RFID and NFC frequency antennas to provide more dynamic monitoring in more expensive applications. Simultaneously converting taggants will prove a popular option for brand owners concerned about counterfeiting.

“Software solutions that handle product identification will hold the most promise, and blockchain is quickly establishing itself as an accessible, scalable platform that can provide security, transparency, and clever inventory management. To take advantage of this potential, software companies are setting up specialised service lines and working closely with logistics and packaging businesses,” the report stated.

Paperboard is said to have the greatest market share due to the pharmaceutical industry's early adoption of track-and-trace technology and the increase in eCommerce shipments. Additionally, there will be high demand for tracking components that work with other typical media, such as paper, metal, rigid plastic, and flexible plastic.