China Tongcheng Tianbai Plastic Co.,Ltd.

SHANGHAI (August 4, 2009) -- Despite upheaval in global markets and a sharp drop in exports, China's domestic beverage industry is bubbling. Consumers are drinking more soft drinks and downing iced green teas, driving up demand for plastic beverage containers.

At two recent exhibitions held in Shanghai, PropPak China and BevTek China, an increase in attendance demonstrated continuing growth in the packaging and beverage container industry.

"Confidence in the Chinese domestic market is strong," said Brendan Jennings, the general manager of China International Exhibitions, the organizer of the events. "[There is a need] for the latest processing and packaging technology amongst the expanding Chinese manufacturing base."

Richard Chen, Beijing-based sales director for China at Demag Plastics Group, said the company's business has recovered quickly in the past few months.

"The financial crisis started for us in December and lasted through January and February," Chen said. "After that, all our businesses started to pick up again."

Improvement in the company's packaging business has been outpacing most other divisions, Chen said.

"Automotive and packaging have both increased," Chen said. "The Chinese government has put a lot of money into different industries and I think consumers are feeling more confident."

Longer-term growth is also expected in China's beverage industry. Among the companies likely to drive future demand are PepsiCo and Coca-Cola Co. Both announced large investment plans for the region in 2008, Pepsi dedicating $1 billion to expansion in the region and Coca Cola promising $2 billion over a span of three years.

In a climate where many plastics companies are struggling, growing demand in China is good news. In a report released by the Freedonia Group in July, demand for beverage containers in China is projected to increase by 8.2 percent annually through 2012. The report predicts that plastic containers, which accounted for 42 percent of beverage containers in 2007, will continue to lead the market.