El Salvador - Packaging EquipmentEl Salvador-Packaging Equipment
Overview
Source: Central Reserve Bank of El Salvador. Note: No reliable source for local production. HS codes: 3901-3923, 4405-4416, 4707, 4804-4823, 8422-8441.
El Salvador’s packaging industry has experienced slight growth with notable opportunities to provide packaging equipment to Salvadoran exporters. There are 233 exporting companies in the packaging industry. There are no packaging machinery manufacturers in El Salvador and most of the equipment and parts are imported. U.S. imports of packaging equipment represent 30% of the total import market. As Salvadoran companies demand innovative packaging to stand out from their competition, packaging equipment suppliers will need to provide equipment that can accommodate a wide range of sizes, shapes, textures, labels, and colors.
According to the Vice Ministry of Economy, exports in the packaging industry represents 71% of the overall exports of the country. Exports in this sector have increased slightly 2017 to $313 million in 2018. The forecast looks good for the upcoming years.
Food Processing and Packaging Equipment
El Salvador’s food processing industry has experienced slight growth with notable opportunities for Salvadoran exporters. The growth is fueled by demand for “ethnic” or “comfort” foods sought by the large population of Salvadorans living abroad. Additionally, El Salvador has proudly become the Central America leader in the production and export of juices and snacks. Food processing companies export mainly to: Guatemala, Honduras, the United States, Spain, Canada, and Nicaragua.
There is perhaps no greater variation of machinery in any industry than that of food packaging equipment in general. In El Salvador, food packaging equipment, parts, and materials are imported mainly from the United States, Mexico, Italy, China, and Germany.
According to the Central Reserve Bank (BCR) of El Salvador, the total exports of food products to other countries reached $431.80 million in 2018. Leading products needing packaging include: sugar, tuna, snacks, baking, candy, coffee, and dairy products.
Salvadoran companies understand that to be able to compete they need to invest in packaging innovation to improve their productivity and efficiency. Salvadoran food manufacturers are looking for innovative branding and packaging solutions. Companies in the food industry range from small family-owned to large corporations. Whether they purchase customized or off the shelf machinery, their priority is to invest in the most suitable equipment that reduces costs, increases efficiencies, and maintains food safety.
Some of the leading industry players include the following companies: Grupo Calvo, S.A. de C.V., Productos Alimenticios Diana, S.A. de C.V., Harisa, S.A. de C.V., Productos Alimenticios Bocadeli, S.A. de C.V., Lacteos El Corral, S.A. de C.V., Eco Foods, S.A. de C.V., McCormick de Centroamérica, S.A. de C.V., Molinos de El Salvador, S.A. de C.V., Bimbo de El Salvador and Sabores Cosco de Centroamerica, S.A. de C.V.
The best opportunities in this sector are: capping machinery, can packaging equipment, water and beverages bottling equipment, retort machines, weight fillers, closing machines, labeling printing, case packers, design, and intelligent packaging software.
Consumer needs are driving innovative trends that are moving to a future generation: digital evolution, clean-label messaging, eco-responsible packaging, and smart packaging. Salvadoran food manufacturers are looking for innovative brand and packaging solutions. Therefore, solutions for intelligent packaging, active packaging, safe packaging and recyclable and sustainable packaging represent untapped opportunities for the market.
Paper and Cardboard
Central America has a strong paper and cardboard production sector. Twenty years ago, El Salvador’s government successfully attracted multinational companies that forced local manufacturers to innovate and produce higher quality products. Companies such as Kimberly-Clark, which operates the largest paper plant in Latin America, not only helped shape the now competitive marketplace but continued to invest in El Salvador.
In 2018, total exports of paper and paperboard as well as articles of paper pulp were $322.7 million. The overwhelming amounts of these exports are to other Central America countries and include products such as: toilet paper, cardboard packaging, labels, napkins and paper tablecloths, and carton boxes.
Leading companies in the paper and cardboard production industry include: Kimberly-Clark de Centroamerica, S.A de C.V., Sigma Q, Alas Doradas, S.A. de C.V., Smurfit Kappa (Cajas y Bolsas, S.A.), Evergreen Packaging de El Salvador, S.A. de C.V. Dar Kolor, S.A. de C.V., Impresora La Unión, S.A. de C.V., Albacrome Sociedad Anónima de Capital Variable, Bemisal, S.A. de C.V. and R.R. Donnelley de El Salvador, S.A. de C.V.
There are no local manufacturers of paper packaging equipment and parts in this sector. Machinery and parts are mainly imported from the United States, Germany, Italy, and China.
Except for a few multinational companies, Salvadoran companies have significantly decreased their investments in new machinery. To succeed in the market, U.S. companies must offer financing options.
The leading demand of packaging equipment and materials in the paper and carton board sector include: unbleached wrapping (including packaging) paper, rolls of uncoated paper and paperboard, containers (boxes, bags, etc.), shrink wrap machines, filling and closing machines, machinery for making pulp and making/finishing paper, machinery for making pulp of fibrous cellulosic material, paperboard cutting machines, machines for making cartons, boxes, cases, tubes or drums.
Plastic Packaging
The plastic sector represents 2.8% of the manufacturing industry in El Salvador. Local packaging companies have consistently invested in new technologies to become Central America’s market leaders in plastic bags, plastic beverage containers, and plastic packaging. Most of the materials and equipment in this sector is imported from the United States. The main competitors are: South Korea, Saudi Arabia, Germany and Spain.
The most exported plastic products are: plastic furniture ($13.8 m.), polymers and other primary forms ($9.8 m.), plastic brooms ($8.7 m.) and plastic shoes ($5.5 m.). The leading export markets for Salvadoran companies include: Guatemala, Honduras, Nicaragua, Costa Rica, and the Dominican Republic.
Top companies in the plastics industry are: Termoencogibles, S.A. DE C.V., Sigma Q, Carvajal Empaques El Salvador S.A. de C.V., SIGMA Q, Ravicorp, Smurfit Kappa-CELPAC, S.A. de C.V., Plastiglas de El Salvador, S.A. de C.V., Tubos y Perfiles Plásticos, S.A. de C.V., Salvaplastic Internacional, S.A. de C.V., Polybag, S.A. de C.V., and Iberplastic, S.A. de C.V.
Flexible packaging has the greatest growth potential in this sector. U.S. companies can successfully compete in the market if the equipment can generate savings for the client, is durable, flexible and adapts to client’s packaging uniqueness, performs as promised, and has adjustable parts. Exceptional customer service and extensive training in Spanish, are essential in successfully entering the competitive marketplace. Most companies are committed to having better environmentally-friendly packaging. Eco-friendly equipment and green technology are in high demand.
Leading equipment and materials in the plastics industry include: resins, equipment for sacks and bags of ethylene polymers, polyethylene, ethylene-vinyl acetate copolymers, plastic tubes, pipes, hoses of plastics, self-adhesive sheets, and thermoforming machines.
Pharmaceutical Packaging
Pharmaceutical packaging equipment from the United States enjoys an excellent reputation and is widely accepted in the Salvadoran market due to high quality and outstanding customer service. The strongest U.S. competitors in this sector are Italy, Germany, and Brazil.
According to the Central Reserve Bank, the pharmaceutical sector experienced 2.1% production growth in 2018. Total exports of pharmaceutical products were $142.2 million, an increase of 1.8% from the previous year. El Salvador exports pharmaceutical products to 37 countries around the world.
Top companies in the pharmaceutical industry are: Laboratorios Vijosa, S.A. de C.V., Corporación Bonima, S.A. de C.V., Grupo Paill, S.A. de C.V., Laboratorios, S.A. de C.V., Biogalenic, S.A. de C.V., Laboratorios Arsal, S.A. de C.V., Establecimientos Ancalmo, S.A. de C.V., Activa, S.A. de C.V., Laboratorios López, S.A. de C.V., Laboratorios Theramed, S.A. de C.V., and Gamma Laboratories, S.A. de C.V.
Best prospects in the pharmaceutical sector include: capsule packaging equipment, pharmaceutical packaging, medical device packaging, labeling, tamper-proof packaging, controls and robotics, sealing devices, barcode label printers, tablet and capsule counters and filling and closing machines. All pharmaceutical packaging equipment needs to follow FDA standards.
Breakdown of distribution channels are as follows:
Importers – Distributors- End-User
Import/Distributor – End-User
Leading Sub-Sectors
U.S. manufacturers of food processing and packaging equipment have the greatest opportunities in the following segments:
Opportunities
The packaging industry is mainly supplied by imports. U.S. exports are more competitive over third country exporters that don’t qualify for CAFTA-DR duty benefits. Import tariffs for packaging equipment under CAFTA-DR are zero.
Whether working with a local distributor or end users, it’s crucial to spend time forming a personal connection before discussing business. Salvadorans are looking for long term business partners that are committed to the market. The U.S. Commercial Service offers customized solutions to help U.S. exporters successfully expand exports to El Salvador.
Following are additional opportunities for U.S. companies to meet Salvadoran potential buyers:
Web Resources
Salvadoran Industrial Association (ASI)
Salvadoran Industrial Plastic Association (ASIPLASTIC)
Corporation of Exporters of El Salvador (COEXPORT)
Ministry of Economy (MINEC)
Salvadoran Economic and Social Development Foundation (FUSADES)
Central Reserve Bank (BCR)
U.S. Commercial Service Contact
Sandra Hernandez, Commercial Assistant Sandra.hernandez@trade.gov
| 2017 | 2018 | 2019 (Estimated) | 2020 (Estimated) | |
| Total Market Size | 260,396,368 | 294,106,982 | 297,048,052 | 300,018,533 |
| Imports | 572,855,245 | 607,142,374 | 613,213,798 | 619,345,936 |
| Exports | 312,458,877 | 313,035,392 | 316,165,746 | 319,327,403 |
| Imports from the U.S. | 174,893,577 | 161,141,689 | 162,753,106 | 164,380,637 |
El Salvador’s packaging industry has experienced slight growth with notable opportunities to provide packaging equipment to Salvadoran exporters. There are 233 exporting companies in the packaging industry. There are no packaging machinery manufacturers in El Salvador and most of the equipment and parts are imported. U.S. imports of packaging equipment represent 30% of the total import market. As Salvadoran companies demand innovative packaging to stand out from their competition, packaging equipment suppliers will need to provide equipment that can accommodate a wide range of sizes, shapes, textures, labels, and colors.
According to the Vice Ministry of Economy, exports in the packaging industry represents 71% of the overall exports of the country. Exports in this sector have increased slightly 2017 to $313 million in 2018. The forecast looks good for the upcoming years.
Food Processing and Packaging Equipment
El Salvador’s food processing industry has experienced slight growth with notable opportunities for Salvadoran exporters. The growth is fueled by demand for “ethnic” or “comfort” foods sought by the large population of Salvadorans living abroad. Additionally, El Salvador has proudly become the Central America leader in the production and export of juices and snacks. Food processing companies export mainly to: Guatemala, Honduras, the United States, Spain, Canada, and Nicaragua.
There is perhaps no greater variation of machinery in any industry than that of food packaging equipment in general. In El Salvador, food packaging equipment, parts, and materials are imported mainly from the United States, Mexico, Italy, China, and Germany.
According to the Central Reserve Bank (BCR) of El Salvador, the total exports of food products to other countries reached $431.80 million in 2018. Leading products needing packaging include: sugar, tuna, snacks, baking, candy, coffee, and dairy products.
Salvadoran companies understand that to be able to compete they need to invest in packaging innovation to improve their productivity and efficiency. Salvadoran food manufacturers are looking for innovative branding and packaging solutions. Companies in the food industry range from small family-owned to large corporations. Whether they purchase customized or off the shelf machinery, their priority is to invest in the most suitable equipment that reduces costs, increases efficiencies, and maintains food safety.
Some of the leading industry players include the following companies: Grupo Calvo, S.A. de C.V., Productos Alimenticios Diana, S.A. de C.V., Harisa, S.A. de C.V., Productos Alimenticios Bocadeli, S.A. de C.V., Lacteos El Corral, S.A. de C.V., Eco Foods, S.A. de C.V., McCormick de Centroamérica, S.A. de C.V., Molinos de El Salvador, S.A. de C.V., Bimbo de El Salvador and Sabores Cosco de Centroamerica, S.A. de C.V.
The best opportunities in this sector are: capping machinery, can packaging equipment, water and beverages bottling equipment, retort machines, weight fillers, closing machines, labeling printing, case packers, design, and intelligent packaging software.
Consumer needs are driving innovative trends that are moving to a future generation: digital evolution, clean-label messaging, eco-responsible packaging, and smart packaging. Salvadoran food manufacturers are looking for innovative brand and packaging solutions. Therefore, solutions for intelligent packaging, active packaging, safe packaging and recyclable and sustainable packaging represent untapped opportunities for the market.
Paper and Cardboard
Central America has a strong paper and cardboard production sector. Twenty years ago, El Salvador’s government successfully attracted multinational companies that forced local manufacturers to innovate and produce higher quality products. Companies such as Kimberly-Clark, which operates the largest paper plant in Latin America, not only helped shape the now competitive marketplace but continued to invest in El Salvador.
In 2018, total exports of paper and paperboard as well as articles of paper pulp were $322.7 million. The overwhelming amounts of these exports are to other Central America countries and include products such as: toilet paper, cardboard packaging, labels, napkins and paper tablecloths, and carton boxes.
Leading companies in the paper and cardboard production industry include: Kimberly-Clark de Centroamerica, S.A de C.V., Sigma Q, Alas Doradas, S.A. de C.V., Smurfit Kappa (Cajas y Bolsas, S.A.), Evergreen Packaging de El Salvador, S.A. de C.V. Dar Kolor, S.A. de C.V., Impresora La Unión, S.A. de C.V., Albacrome Sociedad Anónima de Capital Variable, Bemisal, S.A. de C.V. and R.R. Donnelley de El Salvador, S.A. de C.V.
There are no local manufacturers of paper packaging equipment and parts in this sector. Machinery and parts are mainly imported from the United States, Germany, Italy, and China.
Except for a few multinational companies, Salvadoran companies have significantly decreased their investments in new machinery. To succeed in the market, U.S. companies must offer financing options.
The leading demand of packaging equipment and materials in the paper and carton board sector include: unbleached wrapping (including packaging) paper, rolls of uncoated paper and paperboard, containers (boxes, bags, etc.), shrink wrap machines, filling and closing machines, machinery for making pulp and making/finishing paper, machinery for making pulp of fibrous cellulosic material, paperboard cutting machines, machines for making cartons, boxes, cases, tubes or drums.
Plastic Packaging
The plastic sector represents 2.8% of the manufacturing industry in El Salvador. Local packaging companies have consistently invested in new technologies to become Central America’s market leaders in plastic bags, plastic beverage containers, and plastic packaging. Most of the materials and equipment in this sector is imported from the United States. The main competitors are: South Korea, Saudi Arabia, Germany and Spain.
The most exported plastic products are: plastic furniture ($13.8 m.), polymers and other primary forms ($9.8 m.), plastic brooms ($8.7 m.) and plastic shoes ($5.5 m.). The leading export markets for Salvadoran companies include: Guatemala, Honduras, Nicaragua, Costa Rica, and the Dominican Republic.
Top companies in the plastics industry are: Termoencogibles, S.A. DE C.V., Sigma Q, Carvajal Empaques El Salvador S.A. de C.V., SIGMA Q, Ravicorp, Smurfit Kappa-CELPAC, S.A. de C.V., Plastiglas de El Salvador, S.A. de C.V., Tubos y Perfiles Plásticos, S.A. de C.V., Salvaplastic Internacional, S.A. de C.V., Polybag, S.A. de C.V., and Iberplastic, S.A. de C.V.
Flexible packaging has the greatest growth potential in this sector. U.S. companies can successfully compete in the market if the equipment can generate savings for the client, is durable, flexible and adapts to client’s packaging uniqueness, performs as promised, and has adjustable parts. Exceptional customer service and extensive training in Spanish, are essential in successfully entering the competitive marketplace. Most companies are committed to having better environmentally-friendly packaging. Eco-friendly equipment and green technology are in high demand.
Leading equipment and materials in the plastics industry include: resins, equipment for sacks and bags of ethylene polymers, polyethylene, ethylene-vinyl acetate copolymers, plastic tubes, pipes, hoses of plastics, self-adhesive sheets, and thermoforming machines.
Pharmaceutical Packaging
Pharmaceutical packaging equipment from the United States enjoys an excellent reputation and is widely accepted in the Salvadoran market due to high quality and outstanding customer service. The strongest U.S. competitors in this sector are Italy, Germany, and Brazil.
According to the Central Reserve Bank, the pharmaceutical sector experienced 2.1% production growth in 2018. Total exports of pharmaceutical products were $142.2 million, an increase of 1.8% from the previous year. El Salvador exports pharmaceutical products to 37 countries around the world.
Top companies in the pharmaceutical industry are: Laboratorios Vijosa, S.A. de C.V., Corporación Bonima, S.A. de C.V., Grupo Paill, S.A. de C.V., Laboratorios, S.A. de C.V., Biogalenic, S.A. de C.V., Laboratorios Arsal, S.A. de C.V., Establecimientos Ancalmo, S.A. de C.V., Activa, S.A. de C.V., Laboratorios López, S.A. de C.V., Laboratorios Theramed, S.A. de C.V., and Gamma Laboratories, S.A. de C.V.
Best prospects in the pharmaceutical sector include: capsule packaging equipment, pharmaceutical packaging, medical device packaging, labeling, tamper-proof packaging, controls and robotics, sealing devices, barcode label printers, tablet and capsule counters and filling and closing machines. All pharmaceutical packaging equipment needs to follow FDA standards.
Breakdown of distribution channels are as follows:
Importers – Distributors- End-User
Import/Distributor – End-User
Leading Sub-Sectors
U.S. manufacturers of food processing and packaging equipment have the greatest opportunities in the following segments:
- Machinery for finishing paper and paperboard, carton handling, bagging, shrink and wrapping equipment.
- Heat sealing machines and labeling.
- Filling, closing and sealing machinery, stretch wrapping film, cushioning and void fill machines.
- Used and refurbished packaging machinery (sought by medium-sized Salvadoran companies).
- Biodegradable packaging materials.
- Intelligent packaging software/technology.
Opportunities
The packaging industry is mainly supplied by imports. U.S. exports are more competitive over third country exporters that don’t qualify for CAFTA-DR duty benefits. Import tariffs for packaging equipment under CAFTA-DR are zero.
Whether working with a local distributor or end users, it’s crucial to spend time forming a personal connection before discussing business. Salvadorans are looking for long term business partners that are committed to the market. The U.S. Commercial Service offers customized solutions to help U.S. exporters successfully expand exports to El Salvador.
Following are additional opportunities for U.S. companies to meet Salvadoran potential buyers:
- Pack Expo 2019 – Las Vegas, Nevada – September 22-25
- Process Expo, Chicago, Illinois – October 8-11, 2019
- International Production and Processing Expo, Atlanta, GA – February 12-14, 2020
Web Resources
Salvadoran Industrial Association (ASI)
Salvadoran Industrial Plastic Association (ASIPLASTIC)
Corporation of Exporters of El Salvador (COEXPORT)
Ministry of Economy (MINEC)
Salvadoran Economic and Social Development Foundation (FUSADES)
Central Reserve Bank (BCR)
U.S. Commercial Service Contact
Sandra Hernandez, Commercial Assistant Sandra.hernandez@trade.gov