Sean Milmo, European Editor03.01.14
The European Union is now returning to a period of steady but slow economic growth, after a series of short-lived recoveries since the big financial downturn of 2008.
The current revival is expected to last at least two years, although it may be hampered by unexpected events like the Ukraine crisis. It could be a timely boost for a fragile European printing sector and hard pressed suppliers like ink producers.
The European Commission, the Brussels-based EU executive, was forecasting in January that due to a moderate expansion of the world economy and stronger domestic demand in the majority of the EU’s 28 countries, real GDP would increase by 1.5% this year after flat growth in 2013.
The 18-nation euro zone was expected to move from a decline of 0.4% in 2013, following a 0.7% decrease in 2012, to growth of 1.2% this year.
Some countries will achieve growth of less than 1%, such as Portugal, Italy, Greece and Finland, while Slovenia’s economy would continue to shrink.
By 2015, however, there will be more robust growth across the whole of the EU, pushed by increases in disposable income due mostly to improvements in the labor market. Some EU states, mainly in Eastern Europe, are predicted to reach growth rates of more than 3%, giving the European Union as a whole a GDP rise of 2%.
While many printers and their ink suppliers will be benefiting from higher sales stemming from faster economic growth, their margins are likely to continue to be squeezed by more expensive raw materials.
Commodity prices generally eased last year in Europe but some sectors were highly volatile, particularly petrochemicals providing raw materials for ink production.
With manufacturing activity starting to accelerate from mid-2013, more vigorous demand has been putting even more upward pressure on prices.
“In the base chemical markets, materials such as benzene, styrene, toluene and xylene – important as building blocks for many material categories such as pigments and resins – again continued to rise in the first part of 2013 despite low demand in these markets,” explained Jan Paul van der Velde, senior vice president procurement, Flint Group.
Furthermore, despite poor demand, these raw material prices have remained at relatively high historical levels – above those, for example, prevailing in 2010 when Europe showed signs of a revival from the 2008 recession.
“Clearly the power of supply management in these concentrated markets is substantially larger than the buying weakness,” said van der Velde.
European ink producers were reporting steep rises in gum rosin prices late last year, triggered by Chinese producers but also followed by suppliers in Brazil and Indonesia.
Siegwerk of Germany reported in October that gum rosin prices had gone up by 40% in a few weeks, significantly raising the cost of its portfolio of publication gravure, heatset and coldset inks.
It also told its customers that stricter environmental standards and regulations had been pushing up the prices for important pigment intermediates, particularly in the major production centers of China and India. It expected the price rises to continue into the early part of 2014.
Sun Chemical, which is a pigments as well as inks producer, also warned about the impact of “very tight” supplies of beta naphthol, a red pigment intermediate, in China, where two key manufacturing locations had shut down, pushing prices up by 40%. In India, the price of phthalo intermediates for blue and green pigments had increased steeply because of higher cost of urea, a basic chemicals for phthalo production.
“It is clear that the ink industry is again being confronted with the rising cost of raw materials and unfortunately it does not look like this situation will quickly disappear,” said van der Velde. “The result of these rising costs to some of the key raw material markets will inevitably have an increasing impact on the cost of publication inks.”
van der Velde was speaking before the eruption of the Ukraine crisis in late February and early March, which pushed up many commodity prices while raising uncertainties about the stability of any economic recovery in Europe, particularly Eastern Europe.
Whatever happens on the economic front is unlikely to stem the continuous decline in Western Europe of the print media because the loss of advertising and readers to the relentless march of the internet and more recently mobile communications. Faster economic growth could even accelerate the slump in the printed publications business.
In a report on the global printing industry issued last year, Smithers Pira, a UK-based market research organization, predicted that in 2012-2017, output of printed newspapers in Western Europe could go down in value terms by 31.5%, magazines by 18%, books by 24%, directories by 34% and catalogs by 29%.
In volume terms, the fall during the period would not be as steep for magazines, which could drop by 11%, while with books the downturn would be even sharper at 33%.
Also with magazines, the decline seems to be showing signs of leveling out. In 2007-2012, output had gone down by 18% by volume, according to Smithers Pira
With newspaper, the decrease in output is expected by Smithers Pira to result in closure of titles, reductions in pages and changes in format from broadsheet to tabloid. With magazines, the number of consumer magazines is predicted to go up, although they will have fewer pages but with little change in format. Business magazines will shrink both in numbers of titles and pages as readers shift in greater numbers to online sites for information.
Forecasters of advertising expenditures are expecting a recovery in Western Europe this year, with spending going up by around 2% to 3%. However, ad expenditure on print media is predicted to continue to go down.
Much of the advertising growth will come from spending on internet and mobile communication advertising, with the remainder coming from a rise in TV expenditure.
Mobile is seen in fact as the main driver behind the growth in advertising not only in Europe and North America but the rest of the world. “(In Western Europe) the mobile channel will become more and more integrated into 360-degree advertising campaigns, eating up budgets historically allocated to print and radio advertising,” said Stephanie Baghdassarian, research director at Gartner Inc., Stamford, CT.
London-based media specialists ZenithOptimedia, part of the Publicis advertising group, say that the increased penetration of mobile advertising will be in European countries with the largest proportion of smart phone owners. These include Norway with 73%, Ireland 71%, UK 65% and Netherlands 64%.
The Packaging Market
While the print media struggles with the effects of long-term contraction, packaging is destined to be the big growth area for printing and ink products in the next few years.
Over the five years from 2012-2017, output of packaging and labels is expected to rise by around 7% in value terms in contrast to a decline of 3.7% in the previous five years, according to Smithers Pira figures.
In terms of volume, the output would go up by 4.6% over the five years to 2017 in comparison with a fall of 1.7% in the previous five years. Globally, Smithers Pira is forecasting a five-year volume increase of just under 20%.
In flexible packaging, one of the sector’s biggest segments, demand in Europe is growing at an compound annual growth rate of 3.9%. This is mainly because of strong increases in Eastern European countries, according to a report on global trends in flexible packaging to 2018 published last year by the Texas-based research organization MarketsandMarkets.
The European carton industry is expecting relatively low but solid growth over the next few years, with variations across the region. The annual congress of the European Carton Makers Association (ECMA) last autumn was told by its managing director Hans van Schaik that after a fall in output in carton in Europe in 2012 of 1.3%, growth of 0.6% was expected in 2013. Over the five years to 2017, overall growth would be around 7%, he said.
However, demand for packaging is being impacted by differences in performances of various retail outlets. In an era of austerity, shoppers are, for example, making much more use of discount stores.
In the UK, stores providing deeply discounted goods were recording annual growth rates of 20%, according to the Kantar Worldpanel, a consumer research organization. Over half the country was late last year shopping in either Aldi or Lidl, two German-owned large discount chains.
On the other hand, more upmarket stories in the country were doing well mainly because of the higher earnings of professionals. The premium supermarket chain Waitrose was showing annual growth rates of close to 7% last year, according to Kantar Worldpanel.
Premium products with visually attractive packaging have become popular in Europe across all income groups, with the emphasis on quality rather than quantity.
In the chocolates market, for example, Lindt & Spruengli of Switzerland has been pioneering a different attitude to chocolates. They should be regarded as a “little bit of luxury in everyday routine which is appreciated as a reward by people, even in economically difficult times,” said Adalbert Lechner, the company’s senior manager.
Demand for high-priced chocolates is in fact going up faster than that for mass chocolate products. “This trend will continue as people are becoming aware that chocolate should be consumed at special occasions and not in large quantities,” said James Amoroso, a Swiss food consultant.
Generally with packaging, particularly in the consumer goods market, the prime objective is to catch the eye of the shopper exploring the supermarket shelves.
This is especially the case at a time of restricted advertising budgets. Paul Pickard, Nestle’s head of procurement zone Europe, told the ECMA congress that when a product is being backed with little advertising, packaging helps to communicate what the brand owners needs to tell the consumer.
LED-UV Technology
The need for more visual appeal in packaging has been and is likely to continue to be one of the impetuses behind the recent rapid double-digit growth rates in the use of UV in Europe.
Another major influence behind the widening application of UV has been its quicker curing rates, which have helped to reduce energy costs and raise its operational efficiency.
The faster curing has to some extent been made possible by the introduction by ink producers of highly reactive inks as well as the addition to UV lamps of iron dopants, which has moved their light output to higher wavelengths.
The greater efficiency of UV systems has pushed their costs down to levels which has made the curing method more economical for higher-volume printers, particularly in sectors like packaging. Conventional printers now find UV far more attractive because it makes possible fast turnarounds by eliminating the necessity for warm air drying units.
The use of UV could become even more widespread in Europe due to LED-UV becoming more technically and economically viable. As a result, more ink producers have been developing inks for use with LED-UV systems.
LED-UV has energy costs as much as 70% lower than those with conventional UV technologies and a greater versatility, particularly with regard to substrates. With screen printing, LED-UV can be applied to a variety of foils, laminates, ultra-thin temperature sensitive films, bubble and shrink wraps and rigid surfaces like glass.
One major drawback of LED-UV has been limitations on the amounts of energy it can emit, so that with some applications it may not achieve complete curing. The traditional mercury UV lamps can exceed irradiance levels of more than 10 watts per square centimeter, while LED energy has been producing half that level.
Recently, LED technologies have emerged with much higher levels of energy emission, in some cases well over 10W/cm2. This has raised speculation that after 130 years in use the long-term future of mercury vapor lamps may be now in doubt.
Gallus Group, St. Gallen, Switzerland, an equipment manufacturer, introduced last year an LED supported printing machine using UV inks developed by Siegwerk with one screen and five flexo printing units. The radiant power of the machine is 16W/cm2.
“That makes it possible to cover a broad application spectrum without restricting productivity,” said David Baumann, product manager at Gallus. “I’m convinced the LED-UV technology will supercede the established mercury tube technology over the medium term.”
LED-UV will also help packaging printers and their ink and other suppliers deal with increasing pressure from end-users, especially retail chains, for the provision of more sustainable packaging, which comprises more eco-friendly materials and has smaller CO2 footprints.
“We are convinced that there is further potential for optimization of existing (packaging) products well into 2015,” said Guido Fuchs, sustainability project manager at Coop Genossenschaft, Basel, a Swiss retail chain.
Because of factors like sustainability, life cycle management, safety regulation and brand protection, Sun Chemical has set up a branding solution initiative to cover issues like design, visual appeal on the shelf, brand color consistency, special effects inks and low migration.
Digital Printing on the Rise
Digital printing, comprising the inkjet and laser electrophotography processes, is accelerating its expansion in packaging and other major print sectors.
The rate of digital’s replacement of traditional processes is increasing because inkjet in particular has become more efficient, less expensive and is able to match or even exceed the quality of conventional methods, especially offset and web.
Digital processes are ideal for dealing with the current trend to shorter runs and more customization and personalization of printing products.
In the printing of barcodes and scanning matrices, inkjet and laser are able to cater to the needs of digitalized supply chains in internet shopping and for tracking and tracing systems in conventional retail sectors.
In the European Union’s pharmaceuticals market, an identification system for each individual medicine pack will be introduced over the next three years to combat counterfeiting. High standard inkjet or laser printing of 2D barcodes on the packaging of each item will be expected to withstand the rigors of low temperature storage so that single packs can be scanned accurately by pharmacists before being dispensed to patients.
In the five years 2012-2017, Smithers Pira believes that the main momentum behind the growth of digital printing in Western Europe will switch from electrophotography to inkjet.
In 2007-2012 the output of inkjet went up by 36% in value while that of electrophotography rose by 49%. But in the next five years to 2017 the position will be reversed, with inkjet’s output rising by 61% and that of electrophotography by 20%.
The value of inkjet’s output in 2017 will be the same as that of gravure, while electrophotography’s will be close to that of heatset web offset. But of a projected total printing output of $177 billion in 2017, inkjet’s share will still only be 8% and that of electrophotography 12%, or a combined 20% for digital printing as a whole.
Among the conventional processes, those declining the fastest in the five years to 2017 will be letterpress, with a decrease of 51%, screen 40%, coldset 39% and heatset 23%, according to Smithers Pira.
The sectors in which digital printing will be making the biggest inroads over the next few years are likely to be books, newspapers and newsletters, catalogs, brochures, direct mail and posters, banners and signing.
In surveys of investment intentions, the majority of Western European printers are now planning to invest more in inkjet and/or laser printing equipment.
Most ink producers are expanding their portfolios of inkjet inks. Sun Chemical announced in April that it is extending a range of inkjet inks into the aftermarket of the European digital printing sector, charging half the price of OEM products.
Manufacturers of conventional presses, which have been experiencing falling sales and profits in recent years, are now making emphatic moves into the digital sector.
In November, Heidelberg unveiled an inkjet printing partnership with Fujifilm. The companies will build an inkjet press, with Heidelberg providing the engineering for the press, chassis and paper transport, while Fujifilm will be responsible for the inkjet technology.
“It is our goal to become a global player in the growing digital printing applications market,” said Gerold Linzbach, Heidelberg’s chief executive. “Together with Fujifilm, we can meet customers needs more efficiently and more quickly. Within three years we envision a sales potential for Heidelberg in the digital business of more than €200 million ($275 million).”
Heidelberg was following in the footsteps in the inkjet sector of its main European rivals, KBA and manroland. KBA is developing its own inkjet press with R.R. Donnelley, while manroland has a development partnership in inkjet with Canon/Oce.
Landa Corporation and Komori announced in November they are extending their alliance to enable beta testing early this year of Landa’s Nanograph digital press using Komori’s sheetfed technology. The move could mean the first commercial launches of the new machine by the end of the year, bringing the digital sheetfed process into head-to-head competition with conventional sheetfed machines.
Digital printing is also beginning to open new or extended opportunities in a widening range of sectors. Parts of the high-end of the textile printing industry, which had moved to Asia due to lower costs, are beginning to return to Europe as digital printing textile suppliers can respond more quickly to changes in local demand.
Inkjet is now the predominant printing system in ceramic tile production in Europe, after close cooperation between ink producers, printing equipment manufacturers and tile makers in the development of inkjet technologies. In glass decoration, inkjet is taking a growing share of printed products, particularly in the beverages and drinks sectors, where digital’s versatility gives it competitive advantages over other systems.
The big new area in the next few years for the digital graphic arts business could be 3D printing. Graphics industry companies like Canon, Xerox and HP have announced moves into the fledgling sector, which many pundits think has huge potential for application of jetting technologies. It may not compensate entirely for the huge contraction of the printed publications market, but it could help.
European Editor Sean Milmo is an Essex, UK-based writer specializing in coverage of the chemical industry.
800-936-6695 www.xenoncorp.com
The current revival is expected to last at least two years, although it may be hampered by unexpected events like the Ukraine crisis. It could be a timely boost for a fragile European printing sector and hard pressed suppliers like ink producers.
The European Commission, the Brussels-based EU executive, was forecasting in January that due to a moderate expansion of the world economy and stronger domestic demand in the majority of the EU’s 28 countries, real GDP would increase by 1.5% this year after flat growth in 2013.
The 18-nation euro zone was expected to move from a decline of 0.4% in 2013, following a 0.7% decrease in 2012, to growth of 1.2% this year.
Some countries will achieve growth of less than 1%, such as Portugal, Italy, Greece and Finland, while Slovenia’s economy would continue to shrink.
By 2015, however, there will be more robust growth across the whole of the EU, pushed by increases in disposable income due mostly to improvements in the labor market. Some EU states, mainly in Eastern Europe, are predicted to reach growth rates of more than 3%, giving the European Union as a whole a GDP rise of 2%.
While many printers and their ink suppliers will be benefiting from higher sales stemming from faster economic growth, their margins are likely to continue to be squeezed by more expensive raw materials.
Commodity prices generally eased last year in Europe but some sectors were highly volatile, particularly petrochemicals providing raw materials for ink production.
With manufacturing activity starting to accelerate from mid-2013, more vigorous demand has been putting even more upward pressure on prices.
“In the base chemical markets, materials such as benzene, styrene, toluene and xylene – important as building blocks for many material categories such as pigments and resins – again continued to rise in the first part of 2013 despite low demand in these markets,” explained Jan Paul van der Velde, senior vice president procurement, Flint Group.
Furthermore, despite poor demand, these raw material prices have remained at relatively high historical levels – above those, for example, prevailing in 2010 when Europe showed signs of a revival from the 2008 recession.
“Clearly the power of supply management in these concentrated markets is substantially larger than the buying weakness,” said van der Velde.
European ink producers were reporting steep rises in gum rosin prices late last year, triggered by Chinese producers but also followed by suppliers in Brazil and Indonesia.
Siegwerk of Germany reported in October that gum rosin prices had gone up by 40% in a few weeks, significantly raising the cost of its portfolio of publication gravure, heatset and coldset inks.
It also told its customers that stricter environmental standards and regulations had been pushing up the prices for important pigment intermediates, particularly in the major production centers of China and India. It expected the price rises to continue into the early part of 2014.
Sun Chemical, which is a pigments as well as inks producer, also warned about the impact of “very tight” supplies of beta naphthol, a red pigment intermediate, in China, where two key manufacturing locations had shut down, pushing prices up by 40%. In India, the price of phthalo intermediates for blue and green pigments had increased steeply because of higher cost of urea, a basic chemicals for phthalo production.
“It is clear that the ink industry is again being confronted with the rising cost of raw materials and unfortunately it does not look like this situation will quickly disappear,” said van der Velde. “The result of these rising costs to some of the key raw material markets will inevitably have an increasing impact on the cost of publication inks.”
van der Velde was speaking before the eruption of the Ukraine crisis in late February and early March, which pushed up many commodity prices while raising uncertainties about the stability of any economic recovery in Europe, particularly Eastern Europe.
Whatever happens on the economic front is unlikely to stem the continuous decline in Western Europe of the print media because the loss of advertising and readers to the relentless march of the internet and more recently mobile communications. Faster economic growth could even accelerate the slump in the printed publications business.
In a report on the global printing industry issued last year, Smithers Pira, a UK-based market research organization, predicted that in 2012-2017, output of printed newspapers in Western Europe could go down in value terms by 31.5%, magazines by 18%, books by 24%, directories by 34% and catalogs by 29%.
In volume terms, the fall during the period would not be as steep for magazines, which could drop by 11%, while with books the downturn would be even sharper at 33%.
Also with magazines, the decline seems to be showing signs of leveling out. In 2007-2012, output had gone down by 18% by volume, according to Smithers Pira
With newspaper, the decrease in output is expected by Smithers Pira to result in closure of titles, reductions in pages and changes in format from broadsheet to tabloid. With magazines, the number of consumer magazines is predicted to go up, although they will have fewer pages but with little change in format. Business magazines will shrink both in numbers of titles and pages as readers shift in greater numbers to online sites for information.
Forecasters of advertising expenditures are expecting a recovery in Western Europe this year, with spending going up by around 2% to 3%. However, ad expenditure on print media is predicted to continue to go down.
Much of the advertising growth will come from spending on internet and mobile communication advertising, with the remainder coming from a rise in TV expenditure.
Mobile is seen in fact as the main driver behind the growth in advertising not only in Europe and North America but the rest of the world. “(In Western Europe) the mobile channel will become more and more integrated into 360-degree advertising campaigns, eating up budgets historically allocated to print and radio advertising,” said Stephanie Baghdassarian, research director at Gartner Inc., Stamford, CT.
London-based media specialists ZenithOptimedia, part of the Publicis advertising group, say that the increased penetration of mobile advertising will be in European countries with the largest proportion of smart phone owners. These include Norway with 73%, Ireland 71%, UK 65% and Netherlands 64%.
The Packaging Market
While the print media struggles with the effects of long-term contraction, packaging is destined to be the big growth area for printing and ink products in the next few years.
Over the five years from 2012-2017, output of packaging and labels is expected to rise by around 7% in value terms in contrast to a decline of 3.7% in the previous five years, according to Smithers Pira figures.
In terms of volume, the output would go up by 4.6% over the five years to 2017 in comparison with a fall of 1.7% in the previous five years. Globally, Smithers Pira is forecasting a five-year volume increase of just under 20%.
In flexible packaging, one of the sector’s biggest segments, demand in Europe is growing at an compound annual growth rate of 3.9%. This is mainly because of strong increases in Eastern European countries, according to a report on global trends in flexible packaging to 2018 published last year by the Texas-based research organization MarketsandMarkets.
The European carton industry is expecting relatively low but solid growth over the next few years, with variations across the region. The annual congress of the European Carton Makers Association (ECMA) last autumn was told by its managing director Hans van Schaik that after a fall in output in carton in Europe in 2012 of 1.3%, growth of 0.6% was expected in 2013. Over the five years to 2017, overall growth would be around 7%, he said.
However, demand for packaging is being impacted by differences in performances of various retail outlets. In an era of austerity, shoppers are, for example, making much more use of discount stores.
In the UK, stores providing deeply discounted goods were recording annual growth rates of 20%, according to the Kantar Worldpanel, a consumer research organization. Over half the country was late last year shopping in either Aldi or Lidl, two German-owned large discount chains.
On the other hand, more upmarket stories in the country were doing well mainly because of the higher earnings of professionals. The premium supermarket chain Waitrose was showing annual growth rates of close to 7% last year, according to Kantar Worldpanel.
Premium products with visually attractive packaging have become popular in Europe across all income groups, with the emphasis on quality rather than quantity.
In the chocolates market, for example, Lindt & Spruengli of Switzerland has been pioneering a different attitude to chocolates. They should be regarded as a “little bit of luxury in everyday routine which is appreciated as a reward by people, even in economically difficult times,” said Adalbert Lechner, the company’s senior manager.
Demand for high-priced chocolates is in fact going up faster than that for mass chocolate products. “This trend will continue as people are becoming aware that chocolate should be consumed at special occasions and not in large quantities,” said James Amoroso, a Swiss food consultant.
Generally with packaging, particularly in the consumer goods market, the prime objective is to catch the eye of the shopper exploring the supermarket shelves.
This is especially the case at a time of restricted advertising budgets. Paul Pickard, Nestle’s head of procurement zone Europe, told the ECMA congress that when a product is being backed with little advertising, packaging helps to communicate what the brand owners needs to tell the consumer.
LED-UV Technology
The need for more visual appeal in packaging has been and is likely to continue to be one of the impetuses behind the recent rapid double-digit growth rates in the use of UV in Europe.
Another major influence behind the widening application of UV has been its quicker curing rates, which have helped to reduce energy costs and raise its operational efficiency.
The faster curing has to some extent been made possible by the introduction by ink producers of highly reactive inks as well as the addition to UV lamps of iron dopants, which has moved their light output to higher wavelengths.
The greater efficiency of UV systems has pushed their costs down to levels which has made the curing method more economical for higher-volume printers, particularly in sectors like packaging. Conventional printers now find UV far more attractive because it makes possible fast turnarounds by eliminating the necessity for warm air drying units.
The use of UV could become even more widespread in Europe due to LED-UV becoming more technically and economically viable. As a result, more ink producers have been developing inks for use with LED-UV systems.
LED-UV has energy costs as much as 70% lower than those with conventional UV technologies and a greater versatility, particularly with regard to substrates. With screen printing, LED-UV can be applied to a variety of foils, laminates, ultra-thin temperature sensitive films, bubble and shrink wraps and rigid surfaces like glass.
One major drawback of LED-UV has been limitations on the amounts of energy it can emit, so that with some applications it may not achieve complete curing. The traditional mercury UV lamps can exceed irradiance levels of more than 10 watts per square centimeter, while LED energy has been producing half that level.
Recently, LED technologies have emerged with much higher levels of energy emission, in some cases well over 10W/cm2. This has raised speculation that after 130 years in use the long-term future of mercury vapor lamps may be now in doubt.
Gallus Group, St. Gallen, Switzerland, an equipment manufacturer, introduced last year an LED supported printing machine using UV inks developed by Siegwerk with one screen and five flexo printing units. The radiant power of the machine is 16W/cm2.
“That makes it possible to cover a broad application spectrum without restricting productivity,” said David Baumann, product manager at Gallus. “I’m convinced the LED-UV technology will supercede the established mercury tube technology over the medium term.”
LED-UV will also help packaging printers and their ink and other suppliers deal with increasing pressure from end-users, especially retail chains, for the provision of more sustainable packaging, which comprises more eco-friendly materials and has smaller CO2 footprints.
“We are convinced that there is further potential for optimization of existing (packaging) products well into 2015,” said Guido Fuchs, sustainability project manager at Coop Genossenschaft, Basel, a Swiss retail chain.
Because of factors like sustainability, life cycle management, safety regulation and brand protection, Sun Chemical has set up a branding solution initiative to cover issues like design, visual appeal on the shelf, brand color consistency, special effects inks and low migration.
Digital Printing on the Rise
Digital printing, comprising the inkjet and laser electrophotography processes, is accelerating its expansion in packaging and other major print sectors.
The rate of digital’s replacement of traditional processes is increasing because inkjet in particular has become more efficient, less expensive and is able to match or even exceed the quality of conventional methods, especially offset and web.
Digital processes are ideal for dealing with the current trend to shorter runs and more customization and personalization of printing products.
In the printing of barcodes and scanning matrices, inkjet and laser are able to cater to the needs of digitalized supply chains in internet shopping and for tracking and tracing systems in conventional retail sectors.
In the European Union’s pharmaceuticals market, an identification system for each individual medicine pack will be introduced over the next three years to combat counterfeiting. High standard inkjet or laser printing of 2D barcodes on the packaging of each item will be expected to withstand the rigors of low temperature storage so that single packs can be scanned accurately by pharmacists before being dispensed to patients.
In the five years 2012-2017, Smithers Pira believes that the main momentum behind the growth of digital printing in Western Europe will switch from electrophotography to inkjet.
In 2007-2012 the output of inkjet went up by 36% in value while that of electrophotography rose by 49%. But in the next five years to 2017 the position will be reversed, with inkjet’s output rising by 61% and that of electrophotography by 20%.
The value of inkjet’s output in 2017 will be the same as that of gravure, while electrophotography’s will be close to that of heatset web offset. But of a projected total printing output of $177 billion in 2017, inkjet’s share will still only be 8% and that of electrophotography 12%, or a combined 20% for digital printing as a whole.
Among the conventional processes, those declining the fastest in the five years to 2017 will be letterpress, with a decrease of 51%, screen 40%, coldset 39% and heatset 23%, according to Smithers Pira.
The sectors in which digital printing will be making the biggest inroads over the next few years are likely to be books, newspapers and newsletters, catalogs, brochures, direct mail and posters, banners and signing.
In surveys of investment intentions, the majority of Western European printers are now planning to invest more in inkjet and/or laser printing equipment.
Most ink producers are expanding their portfolios of inkjet inks. Sun Chemical announced in April that it is extending a range of inkjet inks into the aftermarket of the European digital printing sector, charging half the price of OEM products.
Manufacturers of conventional presses, which have been experiencing falling sales and profits in recent years, are now making emphatic moves into the digital sector.
In November, Heidelberg unveiled an inkjet printing partnership with Fujifilm. The companies will build an inkjet press, with Heidelberg providing the engineering for the press, chassis and paper transport, while Fujifilm will be responsible for the inkjet technology.
“It is our goal to become a global player in the growing digital printing applications market,” said Gerold Linzbach, Heidelberg’s chief executive. “Together with Fujifilm, we can meet customers needs more efficiently and more quickly. Within three years we envision a sales potential for Heidelberg in the digital business of more than €200 million ($275 million).”
Heidelberg was following in the footsteps in the inkjet sector of its main European rivals, KBA and manroland. KBA is developing its own inkjet press with R.R. Donnelley, while manroland has a development partnership in inkjet with Canon/Oce.
Landa Corporation and Komori announced in November they are extending their alliance to enable beta testing early this year of Landa’s Nanograph digital press using Komori’s sheetfed technology. The move could mean the first commercial launches of the new machine by the end of the year, bringing the digital sheetfed process into head-to-head competition with conventional sheetfed machines.
Digital printing is also beginning to open new or extended opportunities in a widening range of sectors. Parts of the high-end of the textile printing industry, which had moved to Asia due to lower costs, are beginning to return to Europe as digital printing textile suppliers can respond more quickly to changes in local demand.
Inkjet is now the predominant printing system in ceramic tile production in Europe, after close cooperation between ink producers, printing equipment manufacturers and tile makers in the development of inkjet technologies. In glass decoration, inkjet is taking a growing share of printed products, particularly in the beverages and drinks sectors, where digital’s versatility gives it competitive advantages over other systems.
The big new area in the next few years for the digital graphic arts business could be 3D printing. Graphics industry companies like Canon, Xerox and HP have announced moves into the fledgling sector, which many pundits think has huge potential for application of jetting technologies. It may not compensate entirely for the huge contraction of the printed publications market, but it could help.
European Editor Sean Milmo is an Essex, UK-based writer specializing in coverage of the chemical industry.
800-936-6695 www.xenoncorp.com