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FLEXO Magazine : June 2009
INDUSTRY INDICATORS FIGURE 1. Functional and Barrier Coatings Source: Pira International The Future of Functional and Barrier Coatings Competitive Analysis Cites Drivers, Trends in Paper & Board ira International, a leading industry watchdog for the packaging, printing and paper industries, has published a major new study looking at the market for functional and barrier coatings for paper and board. The Future of Functional and Barrier Coatings for Paper and Board examines this packaging industry segment by product, end-use sector, region and country, with five-year forecasts to 2014. Pira executives provided FLEXO with the following summary of findings. It offers an overview of technology developments, as well as competitive landscape analysis, and then explores key drivers and trends. P Source: Pira International FIGURE 2. Global market for functional and barrier coatings by end use. 16 FLEXO JUNE 2009 Functional and barrier coatings cover a broad spectrum of materials that are coated onto paper and board to provide a barrier of some sort to protect the materials inside, and/or to enable the substrate to act as a suitable package for its contents. Although more than one third of this market lies in liquid packaging, the segment is much broader in scope and application, covering packaging for a wide range of food stuffs; pharmaceutical and medical items; cosmetics; and dry goods such as paper itself (eg. ream wrap). The barrier requirements cover such materials as water and water vapor; oil and grease; oxygen and aroma. With almost 90 percent of the consumption of these products occurring in packaging, most of which is for food, the market for functional and barrier coatings is linked not just to the overall packaging market, but to the global economy as a whole. The packaging industry has seen a growing trend in recent years to plastics, and this has affected sales of metals, glass and paper and board packaging in many ways. More recently, the growing concern for environmental issues has created both opportunities and challenges for all parts of the indus- try. Paper and board packaging is very well positioned to not only withstand these pressures, but to actually benefit from them. At the same time, changes to any part of the economy, from the price of oil to the opening up of the Chinese market affects the opportunities available. www. f le xography. org GLOBAL PERSPECTIVE The worldwide market for functional and barrier coatings for paper and board was valued at $3.778 billion in 2007, growing at 3.1 percent. Unfortunately, it is expected to have fallen in all regions of the world in late 2008. Growth will be negative in many parts of the developed world throughout 2009 and into 2010, but will turn around toward the end of that year. In the emerging economies of Eastern Europe and Asia, recent exceptional growth rates will fall throughout 2009 and 2010, but will again climb in late 2010 to 2014. This expansion will not reach the same levels as has been seen in recent years. The effect of these emerging economies lifts the global market for functional and barrier coating, to permit a modest increase of 2.7 percent CAGR (compound annual growth rate) to 2014, when it will be worth $4.561 billion. The main products being used as a functional or barrier coating on paper and board are extrusion polymers, which account for 46 percent of the market. Another key barrier is aluminium foil, which makes up a further 18 percent. The main market for these materials is in liquid packaging board (LPB), which is used for fresh and longlife liquid products such as dairy, fruit and vegetable juices, soups, etc. Fresh products do not need the same degree of barrier protection as the long life products. This means that many grades of LPB used for this application com- CARTONS
Sustainable Spring 2009