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Mexico's Ink Market Anticipates Slight Growth in 2002



By Charles Thurston, Ink World Correspondent



Published October 7, 2009
Related Searches: ink offset efi flexo
The ink market in Mexico is poised for the start of growth, with recovery anticipated during second-quarter 2002, or during the third quarter at the latest, say several industry executives.

The ink market performance should follow gross domestic product growth, albeit with a slight lag. Total ink sales in Mexico, which amounted to roughly $150 million in 2001, should increase by at least $3 million this year, given the expected 1.4 percent average increase in GDP during 2002.

The country’s economy is predicted to grow by 1.4 percent this year, in comparison with the estimated 0.2 percent retraction in GDP logged in 2001, according to market analysts led by Michael Gavin at UBS Warburg, in Stamford, CT.

Ink Outlook



To help support stronger growth this year, some Mexican companies are looking to augment exports more aggressively.

“The reactivation of the economy in the U.S. will pull us up, and we’ll grow faster than you might think in some segments, but the average growth this year will not be higher than 1.5 percent,” said Jose Luis Zamora, president of the Camara Nacional de la Industria de Artes Graficas, or Canagraf, the national industry association in Mexico City.

Among ink segments where growth should be strongest are those which already take up the largest share of market value.

“Flexographic inks and web offset ink are the fastest growing,” said Mr. Zamora.

Sun Chemical holds the market leadership in flexography and liquid areas, noted Brad Bergey, Sun Chemical GPI’s vice president for operational support – including exports to Mexico. Domestically-owned Sanchez S.A. is the largest ink vendor in Mexico, and has a lead position in web offset and uncoated stocks.

One printing activity that could help drive growth in the ink market is an increased production of sales tax receipts, an area of intense focus by the new Vicente Fox government. “There may be more printing by both the financial and the non-financial companies this year,” said Mr. Zamora. He added that computer-printed materials of all types also are expected to increase over the short term.

Major multinational printers have made big investments in Mexico to take advantage of the competitive cost of production within the North American Free Trade Agreement (NAFTA) zone, which also includes Canada and the U.S. Mexican ink producers also made substantial investments in new technology in 1999 and 2000, Mr. Zamora said.

As a result, the industry is now poised to benefit from the continental economic recovery, added Mr. Bergey. “Capabilities are good and Mexico is in a strong position to export,” he said.

Among companies that plan to augment their export activities is Sanchez, which is rumored to be targeting California, in particular, within the U.S. market.

Sanchez ink products in the sheetfed offset market are distributed in the U.S. by Pro-Line Printing Ink Corp., Phoenix, AZ. Pro-Line, a distribution subsidiary of Mix & Match Corp., also of Phoenix, has been selling Sanchez inks for more than a decade, since the Mexican company abandoned its own Houston, TX beachhead, said Willis Hawrylkiw, vice president of Pro-Line.

Other multinational players that may use Mexico for an export platform include BASF, which currently imports inks for the Mexican market from Stuttgart, Germany. “One of our targets is to get stronger in Mexico for the domestic market and also for Central America,” said Norbert Wuensch, the global director for BASF ink sales, based in Stuttgart.
Charles W. Thurston writes on Latin American finance, technology and trade from Willow, NY. His e-mail address is hemispherenews@mindspring.com.




























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