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FLEXO Magazine : September 2009
16 FLEXO SEPTEMBER 2009 www.flexography.org INDUSTRY INDICATORS NORTH AMERICA -- LABEL DEMAND BY APPLICATION METHOD & MATERIAL (million square meters) Item 1998 2003 2008 2013 2018 Label Demand 7020 8230 9680 11000 12800 By Application Method: Pressure Sensitive 3775 4755 5675 6665 8000 Wet Glued 2515 2555 2785 2830 2915 Other 730 920 1220 1505 1885 By Material: Paper 5400 6130 6915 7485 8300 Plastic & Other 1620 2100 2765 3515 4500 LABELS North America---it boasts one of the world's most sophisticated label industries and stands at the forefront in developing labeling technologies ranging from pressure sensitive to electronic article surveillance and "active" labels, such as those employing thermochromatic inks. Label demand in the region is projected to advance 2.6 percent per year through 2013 to 11 billion square meters. Production volumes are set to outpace Western Europe and Japan. Global marketshare calculated out to 25 percent in 2008, with the United States responsible for 4/5ths of that volume---a full 20 per- cent of worldwide label manufacturing. Just released analy- sis from The Fredonia Group, reveals those statistics; and it also indicates that: • Demand for pres- sure sensitive labels will outpace the overall market. • Fastest growth will arise from the much smaller stretch and heatshrink sleeve product segments. • Paper will continue to lose marketshare to plastic stock materials . Fredonia's analysts report, "The food sector represents the largest individual component of the North American label market. However, through 2013 the pharmaceuticals segment holds fastest growth prospects, while the mature food seg- ment will see negligible gains." Observations by country---the United States, Mexico and Canada---were also made. UNITED STATES "With per capita demand of 26 square meters in 2008, the U.S. is one the world's most intensive label using nations," according to Fredonia researchers. "Bedrock packaging markets for labels are generally mature in the country, especially in the key food packaging market. Labels face competition from direct printing in applications ranging from drink cans to flex- ible packaging." The U.S. is, unargu- ably, the world's largest national producer and consumer of labels. Fredonia maintains that it accounts for 20 per- cent of global demand and 82 percent of the North American market. Through 2013, demand is projected to advance 2.4 percent per year to 8.9 billion square meters. Forecasters say most dramatic gains are expected in the pharmaceuticals segment. They credit an aging population, as well as regulatory and social pressures, and increased competition, with giving rise to demands for more detailed labeling and more extensive decoration. Predictions indicate that development of high value-added labels with expanded content and RFID features will bolster sales in the pharma- ceuticals market. Other factors affecting U.S. label business drew comment from Fredonia. Specifically, the statistical research team believes, "Pressure sensitive labels will continue to steal mar- ketshare from wet-glued labels. They will also face increasing competition from other application methods, such as stretch sleeve and heat-shrink sleeve labels, which will post more rap- id advances. Gains in the stretch and shrink sleeve segments will be driven by increased usage in the beverage packaging REGIONAL ROUNDUP United States: World's Largest Label Producer. Global Marketshare = 20%/ North American Marketshare = 82%. Projected Annual Growth = 2.4%. Yearly Production Estimate = 8.9 billion square meters. Canada: North American Marketshare = 8%. Projected Annual Growth = 2.9%. Yearly Production Estimate = 895 million square meters. Mexico: North American Marketshare = 10%. Projected Annual Growth = 3.6%. Yearly Production Estimate = 1.2 billion square meters. North America: The World's Label Powerhouse Production Volumes Set to Grow in U.S., Mexico & Canada Source: The Freedonia Group, Inc.