The Packaging Ink Market

By David Savastano, Ink World Editor | 10.02.08

Higher raw material costs and the weakening economy have impacted the packaging market, although there are also opportunities for growth.

Traditionally, when the economy has suffered downturns, the packaging ink market has been more

Royco Sauce Pouch, printed by CLP Packaging Solutions, Inc., received the Flexible Packaging Association’s 2008 Highest Achievement Award for Packaging Excellence as well as a Gold Award in Packaging Excellence. The shaped retortable pouch protects its contents with outstanding barrier properties, offers a cost-effective alternative to rigid packaging, and functions beautifully during the heating and serving process – adding to its appeal and its consumer convenience.
resistant to economic pressures. However, in the past year, even the packaging market is being impacted by the economy, as ink manufacturers also cope with the added pressures from higher raw materials costs.
“We see the packaging market globally and in North America continuing to show growth, but given the current economic climate, we expect the impact on future growth rates in packaging to be affected,” said Michelle Hearn, director of marketing, Packaging, North American Inks, Sun Chemical. “Growth in the packaging market is spurred primarily in the flexible packaging market segment. However, imports are outpacing exports and because business is being moved off shore to Asia and South America, the packaging ink market in North America is relatively flat.”
“This past year has been a difficult year relative to the historical performance of the packaging market,” said Michael Impastato, vice president, business development, Packaging Division for Flint Group. “Early in 2007, there were signs of strong growth and improved performance for companies involved in packaging. And it is true that packaging is somewhat more resilient than some other printing segments. But, beginning in mid-2007 and continuing through 2008, we have seen the package printing market slow down. The unprecedented cost increases for materials has everyone concerned and the resulting slow down in the general economy has impacted the market.”
Enno Urbeinz, manager external communications, corporate communications for Siegwerk, said that Siegwerk enjoyed growth in all regions, although North America and Europe were not as strong.
In both Europe and North America the economy is weak,” Mr. Urbeinz said. “That is why the European market is difficult. Siegwerk NAFTA has managed to grow organically mainly due to very good products for packaging applications including flexible packaging, labels, tobacco, paper and board and sheetfed UV. In addition, growth has come from our continued dedication to providing a quality product coupled with outstanding point-of-use service and technical support.”
For Siegwerk, Asia and Latin America were particularly strong markets.
“We especially experienced a strong increase in UV ink systems as well as interesting and promising results with water-based in Asia,” Mr. Urbeinz said. “The flexible packaging market has also shown positive development in Asia recently. All countries in the region have seen a growth that is slightly above the country GDP.
“For Siegwerk in South America, during 2007 the flexible packaging and self adhesive labels markets were the stars,” Mr. Urbeinz added. “Both segments received relevant amount of investments in presses and additional facilities, mainly in countries like Brazil, Argentina and Chile.”
“Siegwerk’s core competence lies especially in the high end packaging segments (food, pharma and luxury packaging). Despite all negative economical impacts, we believe that these segments are less touched by overall economic ups and downs,” Mr. Urbeinz added.

Avery Dennison Security Printing Division received Best of Show honors from the 2008 Packaging & Label Gravure Association Print Quality Awards for its Forever two-sided booklet, printed 10 colors using Siegwerk C Type solvent-based inks.
Ms. Hearn said that Sun Chemical expects the majority of the growth in packaging inks to occur primarily in the Asian market.     

"We see more and more global converters moving into Asia and South America by building a presence to support the needs of global consumer packaged goods (CPGs) companies,” she said.
Joerg-O Seeger, president of Hostmann-Steinberg USA, also noted stronger growth in Asia. “The offset printing has seen very little growth while flexo and gravure printing market continued to grow 4 to 5 percent in North America and seen much higher growth in Asia,” said Mr. Seeger.
David Callif, president of BCM Inks U.S.A. Inc., a specialist in the corrugated market, focusing on high graphics packaging and POP displays, noted that BCM Inks has enjoyed growth this year, driven by such environmentally friendly products as its Eekoflex inks and varnishes. These inks and varnishes are made from paper residue.
 “In terms of the packaging market, North America has been extremely challenging, while in Latin America, we are seeing our business improve,” said Mr. Callif.
“We have been able to grow our business by developing innovative products. You’ve always got to look at the future to see what the needs of the marketplace are, especially in terms of sustainability and green chemistries,” Mr. Callif said. “We’ve been going in that direction since day one, when we first modeled our plant, and we have continued to improve over the years. We were the only ink company invited to participate at Wal-Mart’s Sustainability Expo.”

Impact of Raw Materials

The dramatically higher costs of raw materials, which ink companies can no longer completely cover, are

Pulsate, printed by Gilbreth Packaging, received top honors in PLGA’s 2008 Print Quality Awards for the Heat Shrinkable, More Than 13% category. Pulsate was printed with 6 colors on PETG. The judges noted that the metallics are bright and the silver printing came out extremely well , which is not easy to print.
a source of concern for customers. Sun Chemical, Flint Group, Siegwerk, hubergroup and other ink industry leaders issued significant price increases to try to cover the higher costs they are getting from their own suppliers.    
“Like our competitors, we are facing problems with rising prices for raw material which eventually ended up in a price increase during the second half of this year,” Mr. Urbeinz said.
“The continuous increase of raw material costs over the last couple of years has placed a tremendous strain on both the business and customer relationships,” Mr. Impastato said. “Over the last couple of years we have seen costs increase more than any time in recent history. Historically we have seen raw material costs go down more than they have gone up. When we have seen costs increase, the increase was single-digit increases. We were generally able to minimize the impact by reformulating our products, or find alternative materials.
“This hasn’t been the case with the increases we have seen in the last couple of years,” Mr. Impastato added. “First of all, there had been a ramp-up of cost prior to the major increases we have seen. During this ramp-up of costs, most ink companies absorbed these increases rather than pass them to their customers. So, when the major increases started coming through, there was no choice but to pass on price increases. But, even with price increases it has been difficult. Typically the industry does not move quickly and the delays in implementing pricing changes in the face of double-digit cost increases can generate challenges. Of course these resulting price increases puts pressure on your relationships with customers.”
“The current economic situation, coupled with tight raw material supply, has affected everyone – printer, supplier, end-use consumer – both at work and home,” added Susan Kuchta, vice president/general manager of Flint Group’s North American Packaging Inks Division. “Unfortunately, there is no significant change in sight. We do our best to optimize every process, policy and supplier contract, but Flint Group, like all industry suppliers, is not immune from the market conditions. We do our best to help customers plan for, and deal with, the economic realities of this time.”
“Like our competitors, we are facing problems with rising prices for raw material which eventually ended up in a price increase during the second half of this year,” Mr. Urbeinz noted.
Mr. Seeger said that printers are doing what they can to make ends meet, most notably by trying to improve productivity.
“This market is seeing higher productivity as the means of counterbalancing the cost increase in the raw materials,” Mr. Seeger said. “High speed presses require improved inks for productivity. In addition, competition in consumer marketing is leading to some changes in packaging design – more UV printing will be seen in the future.”
Mr. Callif said that with Eekoflex, BCM Inks is creating an ecologically friendly product using after-products of the pulp making process, which is really a different approach.        

Hershey’s Bliss-Dark Chocolate Bliss, printed by Bemis Flexible Packaging, received top honors in the Film/Film Lamination-Process category in the 2008 PLGA Print Quality Awards. This package is printed in 8-colors with registered white with three ply in-line adhesive lamination consisting of OPP/Ink/Adhesive/Metalized OPP/ Adhesive/PE using solvent-based inks and solvent-based and water-based adhesive. 
“Our ability to remove petroleum-based acrylic resins have allowed us in some cases to maintain prices,” Mr. Callif added. “Higher prices are impacting us, from transportation and packaging to pigments, but we are also finding innovative ways to reduce our own packing and shipping costs. We are optimistic that this economy is providing us with opportunities that we can capitalize on because of our R&D and ability to offer different solutions.”

Growth Markets
For Packaging

There are particular niches in packaging that are enjoying excellent growth.           
Mr. Impastato noted that shrink sleeves continue to outpace other segments for growth, but the rate of growth for shrink sleeves has tapered off over this last year.
“This was not unexpected since this technology is beginning to mature and all the early adopters have already converted their products to shrink sleeves,” Mr. Impastato said. “But shrink sleeve offers a unique look and capability, which will continue to support higher than average growth over the upcoming years.    
“Another area of higher growth is ‘stick packs,’” Mr. Impastato added. “We have seen a broader use for this package type during this last year. It represents an easy-to-use package which is very economical. I think we will see stick packs growing in use as a wider variety of products see its advantages.”
Mr. Impastato said he has not seen any significant shift in market share between the various package printing application methods.
“Flexo continuous to dominate the package printing market, but sheetfed dominates the folding carton portion,” Mr. Impastato noted. “Gravure has a solid hold on a minority part of the market, mostly in flexible packaging, and will likely hold its share because gravure offers unique capabilities which can not be duplicated by other print methods.”
Mr. Urbeinz said that significant gains were mostly made in the sleeve technology for flexo and in-mould labels. “Water-based technology has also shown promising results in gravure for tobacco market and we still have great success in flexo,” he added. “By working together, all graphic arts partners have proven that flexo can be competitive in cost and quality vs. all other technologies.”
Ms. Hearn noted that Sun Chemical has seen its greatest growth in the flexible packaging segment and some growth in the corrugated segment.
“The paper and board and corrugated segments will also experience some growth,” Ms. Hearn said. “We expect increased sales in the flexible, paper and board, and corrugated segments will come at the expense of rigid plastic and metal packaging. Despite flat or limited growth in the overall packaging ink segment, we believe innovation and Sun Chemical’s global presence position us well to serve these customers and generate solid growth.”
Ms. Hearn said there are several exciting growth areas for the coming years.
“We see continued opportunities in the flexible packaging market,” Ms. Hearn said. “We also see the need for introducing new technologies that offers the converter improved productivity. The benefits seen in cure time coupled with the improved runnability with energy curable (EC) inks, specifically electron-beam cured inks, place these inks in the opportunity window.    
“Offering the converter the ability to improve its color matching capabilities with new tools is another

SleeveCo, Inc.’s Noble 100% Pure Tangerine Cranberry received top honors from the PLGA in the Composite Substrate division. This is printed 8-colors printed on a PLA substrate (corn-based film). The judges commented that this was a nice bright sample reflecting the orange in the tangerine in contrast with the red in the cranberries.
opportunity for growth – including the areas of printable coatings technology that either enhances packaging barrier properties, actively helps to maintain the original quality of packaged food, or intelligently provides information on the quality of packaged food,” Ms. Hearn added. “We also see opportunities as brand owners seek and converters deliver packaging designed to meet the demand for environmentally friendly packaging with sustainability in mind. Increasingly we are seeing greater interest in water-based packaging ink technology.”
drupa 2008 gave attendees a glimpse into that future.
Ms. Hearn noted that digital inkjet developments were one of the key themes at drupa this year. Ms. Hearn noted that in addition to digital technology, brand protection products for converters and brand owners had a strong presence at drupa this year. For brand owners and suppliers, counterfeiting is on the top of their minds, and at drupa attendees saw security products ranging from relatively low-cost entry-level features to very high-level proprietary technologies.
Mr. Impastato noted that drupa showcased some interesting new technologies for packaging.
“In general, two areas caught my attention,” Mr. Impastato said. “The first was the improvements the wide web flexo press manufacturers have made in the speed of change-overs and the reduction in waste. The new technologies and processes being put into place allow extremely fast job change-overs while minimizing waste to levels we never thought possible just a few years ago.
“The second area was the increasing use of mid-web size presses for packaging,” Mr. Impastato added. “In the past, most packaging was printed on wide web presses. The industry was interested in printing three or four images wide to increase the through-put of the press. Now we are seeing presses which have been designed to print one wide. These presses are designed to fill a niche in the market for short run jobs. As personalization increases and product modifications (flavor, color, etc.) increase, shorter runs become more demanded. These mid-web presses may fill an important role in future package printing.”

Developing New Solutions
For the Packaging Market

The packaging market features some of the most innovative printing solutions, and ink manufacturers are pouring resources into R&D.
Mr. Impastato said that while Flint Group provides a wide portfolio of products for the entire package printing market, its new technology related to flexible packaging and folding carton is gaining wide interest.
“We have new inks for flexible packaging with over a larger operating window of application, providing good end use performance while providing excellent press performance,” Mr. Impastato said. “These inks can typically take the place of several different ink systems, reducing the number of ink systems needed. This reduction in complexity and inventory pays dividends for the printer. Our new pH stable water based gravure ink for folding cartons is demonstrating superior press stability and supporting our customers sustainability programs. We also have a variety of robust ink systems for sheetfed packaging printing in our K+E and ArrowStar product lines.”
Mr. Urbienz said that Siegwerk was active in R&D, developing an environmentally friendlier sheetfed packaging ink. “One example is the launch of Tempo Nutripack for conventional sheetfed printing in 2008,” Mr. Urbienz said. “Tempo Nutripack is an environmentally sound product for packaging with solvents based on vegetable components with reduced odor, which delivers outstanding print quality at a competitive price.”
Mr. Seeger noted that hubergroup has launched a wide variety of inks for the packaging ink market, beginning with its !NKredible offset inks, formulated to meet the productivity demand of the printers, and designed differently to adjust with the change in substrates and productivity needs.
hubergroup also launched MGA, low odor and migration offset printing inks; New V high performance UV cure systems for offset and flexo printing; Hydro-X water based flexo ink system; and Gecko solvent-based flexo and gravure inks for packing application in Europe and many more market specific ink system around the globe.
Mr. Callif noted that BCM Inks’ Eekoflex inks and varnishes, made from paper residue, are also formulated from pigments without any heavy metals, have little or no volatile organic compounds (VOCs) and are shipped in reground plastic buckets. Eekoflex prints the same as other water-based flexo inks with the added benefits of improved lay and minimal bronzing.

Ms. Hearn noted that this year at drupa, Sun Chemical and Comexi Group celebrated breaking the landmark target of 500 meters per minute with WetFlex printing flexographic printing process. This proprietary technology, which has been developed in a partnership between Sun Chemical, Energy Sciences Inc (ESI) and Comexi, was shown in public for the first time at drupa.  

WetFlex delivers wet-on-wet flexographic printing and is designed to meet the needs of the flexible packaging market for improved print quality, efficiency, and low environmental impact.  WetFlex uses new generation energy curable ink technology specially developed and patented by Sun Chemical for the process.

Sun Chemical also showcased SmartColour, a spot color management portfolio that allows brand owners to predict how their product brand colors will reproduce on a variety of substrates, allows brand owners to see end results at any time during the workflow process and make color management much more efficient and cost effective. This is done due to a new version of SmartColour’s iVue, a Photoshop plug-in that allows packaging developers to see real color end results anywhere in their workflow.

iVue relies upon the massive SmartColour color database of real ink colors, on common packaging substrates printed by relevant printing processes allowing users to consider multiple alternatives to

Also at drupa, Sun Chemical demonstrated the development of a new and novel ink chemistry specifically designed for curing under exposure to UV light from LED sources as well as the development of ink chemistry designed to support and deliver conductive films using nano-particles of silver.

In addition to displaying its newest digital ink offerings, Sun Chemical displayed its newest digital platforms for the narrow web and corrugated markets. During drupa, Sun Chemical announced IMG Digipack GmbH, based in Remscheid, Germany as its first beta partner for FastJet®, the world’s fastest inkjet printing press for corrugated packaging.

Also on display was SolarJet , a web-to-web UV single pass inkjet press for printing self-adhesive labels. SolarJet offers printers an economically viable solution for print runs of 10,000 labels or fewer, freeing up their flexo presses for the higher-volume jobs. With a printing speed of 80 feet per minute, SolarJet is a roll to roll printing system 6.5 inches wide using 4-color process UV inks. During Labelexpo in the Americas 2008, Sun Chemical sold its second SolarJet inkjet label press to American Tag & Label Inc. based in Canton, Michigan. 

At drupa, Sun Chemical showed security and brand protection as part of its overall packaging solutions.  Sun Chemical has been active for several years and has grown a customer profile of national governments, major brand owners around the world and converters interested in offering brand protection features as part of their own portfolio. 
Visitors to the show explored the company’s products, which go from generic entry-level up to very high security proprietary technologies. Sun Chemical’s specialty is product and document authentication, which means being able to distinguish a fake item from the genuine product at the touch of a button using covert machine-readable inks and coatings at any point in the supply chain.

Sun Chemical recently introduced Platinum White, a UV flexo white ink that improves the productivity of converters when printing narrow web labels by delivering increased line speeds, faster changeovers, improved color separations, and reduced costs.

A recipient of a 2008 PIA/GATF InterTech Technology Award, Platinum White technology improves on rotary screen technology by enabling increased press speeds, adhesion to many challenging substrates, overprint ability with standard UV letterpress, UV and water-based flexo inks and coatings, better color separations, faster make ready times, and reduced consumable costs.

Sun Chemical’s AquaPro is the company’s next generation of water-based ink technology. An innovative value-added system that increases productivity for the printer, AquaPro delivers the world-class quality printing that the narrow web market demands. AquaPro offers superior print densities, user-friendly press stability, excellent performance on paper and film substrates, enhanced thermal resistance and easy clean up, all in a single ink system.