Dave Savastano, Editor10.01.15
China’s economic growth during the past decade is remarkable. According to the World Bank, the gross domestic product (GDP) in China was worth $10.36 trillion US dollars in 2014, growing by 9.15% from 2013. China’s GDP is more than 13% of the $77.87 trillion global economy; by contrast, China’s GDP was $2.73 trillion in 2006.
This growth is driven by a variety of factors. The country’s population is estimated at 1.375 billion, nearly 20% of the world’s population. China has developed a sizable manufacturing base that caters to its domestic market as well as exports.
As a result, the printing market in China is also very strong, with common estimates of $150 billion. The Print Industries Market Information and Research Organization (PRIMIR), the market research association of NPES The Association for Suppliers of Printing, Publishing and Converting Technologies, calculated that the corrugated market alone in China was $26.5 billion in 2013, with folding carton at $10.7 billion and flexible packaging at $7.1 billion.
The printing industry continues to expand in China as well. In June 2015, Amcor Flexibles Asia Pacific completed its acquisition of Zhongshan Tiancai Packaging Company. This brings Amcor’s footprint in China to 10 manufacturing plants. As another example, Crown Holdings opened three new beverage can plants in China less than two years ago, with annual capacity estimated at more than four billion cans.
The Ink Industry in China
The ink industry is prominent in China with domestic and multinational ink manufacturers represented. Ink World estimates the Chinese ink market at $1.5 billion annually. Bauhinia Variegata Ink & Chemicals, a subsidiary of Yip’s Chemical, reported $207 million in sales in 2014, making it the 13th largest ink manufacturer in the world according to Ink World’s Top International Ink Companies report (July/August 2015).
Xinxiang Wende Xiangchuan Printing Ink Co., Ltd. and Letong Chemical Products Co., Ltd. both were among the top 20 companies in the report, with estimated sales of $100 million and $95 million, respectively.
Multinational ink industry leaders are active in China as well. DIC (China) Co., Ltd., a subsidiary of DIC Corporation, the world’s largest ink supplier, has approximately 40 locations in China, including seven ink manufacturing sites. Hangzhou Toka Ink, a joint venture with T&K Toka, and Tianjin Toyo Ink Co., Ltd., a JV with Toyo Ink, are among the five largest ink manufacturers in China.
Aside from DIC, among the billion-dollar global ink manufacturers, Flint Group has seven locations in China; Toyo Ink has 13 locations, eight of which manufacture ink; Sakata INX has three plants; Siegwerk has four sites; and hubergroup has two locations.
Chinese ink industry officials said that the past year brought further growth to their companies.
With annual production capacity of 95,000 metric tons, Bauhinia Variegata Ink & Chemicals specializes in offset inks, gravure flexible packaging inks for food and drinks, screen inks and UV inks. The company relies on its R&D team to develop new products that fit in with the growing interest in environmentally friendly products.
“Our R&D center consistently strengthens product development and improvement,” a company executive reported. “The demand for environmentally-friendly ink products has been increasing and the company has developed different kinds of ‘green’ products, for example water-based gravure lamination ink, to adapt to the market.”
Shogo Tachibana of the Corporate Communications Department at DIC Corporation noted that DIC has been present in China since 1919.
“It is now 30 years since DIC formed a joint venture for local manufacturing in China,” Tachibana added. “China is one of the most important markets for DIC, and DIC has been putting priority onto the ink business in this market. DIC opened a mother plant in Nantong and has been enhancing its capability.”
Tadashi Nakano, manager, Global Innovation Division at Toyo Ink Co., Ltd., noted that Toyo Ink has been active in the Chinese ink industry since 1926, when the company opened its first overseas branch office, Toyo Ink Manufacturing Co. in Shanghai, China.
“During the 1980s, we set up several local production and sales bases, reinforcing our commitment to the country,” Nakano added. “Today, we have a footprint of more than 10 production bases engaged in the production of offset, liquid, metal decorative and resist inks for LCDs, as well as can coatings, adhesives, plastic colorants and color filter pastes.”
Yuichi Kataura, GM of the International Operations Division of Sakata INX Corp., noted that Sakata INX has been active in China for nearly 20 years.
“China is one of the sites among multiple locations that we operate in Asia,” Kataura added. “We believe that expanding sales of packaging ink and offset ink is the key to growth in the Chinese market.”
China’s GDP growth has slowed, with the World Bank reporting that 2Q 2015 GDP growth was 1.70%. Nakano said that China’s economic slowdown further weakened the already-soft commercial printing market, but the packaging market flourished.
“Demand in markets further inland, however, remained strong,” Nakano observed. “As such, in recent years, the Toyo Ink Group expanded its gravure and offset production bases in western China to meet the demand growth.
“China’s packaging market experienced steady growth in 2014,” Nakano added. “This was driven by consumer demand for more sustainable and natural food and beverages as well as regulatory changes, resulting in a growth for eco-friendly inks. In particular, sales of our toluene-free, MEK-free inks, such as our MultiStar series of lamination gravure inks, remain strong in China and Southeast Asia.”
Kataura said the ink industry did slow somewhat in China last year.
“There wasn’t much growth in 2014, with 670,000 tons of printing ink sold, down 7.2% from 2013,” said Kataura. “We suspect the main reason was a slowdown of the Chinese economy with the implementation of a thrift ordinance, a decrease in domestic spending, and a decrease in exports because of the currency factor and an increase in labor costs. Despite all of these factors, the Chinese economy is expected to grow.”
Tachibana reported that China’s economic growth did slow some over the course of the past year.
“Thrift ordinance and government’s strict control over the government spending slowed down China’s economic growth, and due to this trend, printing and ink industry were negatively impacted,” Tachibana said. “Digitalization continuously affected total volume of publication, especially newspapers.”
Leading Printing Technologies in China
In terms of printing technologies, the printing industry remains largely offset- and gravure-based, but these are changing with the gains being made in flexo and inkjet. Kataura estimated that 40% of the Chinese ink market is sheetfed, 30% is gravure, 10% flexo and 20% divided among other technologies. Nakano added that sheetfed offset and UV printing are fairly strong, with gravure being the leading process for packaging printing.
“The UV ink and inkjet ink industry is definitely growing in China,” Kataura added.
“For publication, sheetfed offset and web offset remain the main technologies for commercial and newspaper printing,” Tachibana said. “For flexible packaging, gravure is the main technology, while flexo is starting to gain attention.”
Interest in the environment is leading to growth in UV and flexo printing.
“Under the condition of current government instruction to control environmental impact, flexo and UV are expected to grow,” Tachibana added. “Digital printing is expected to grow.”
Nakano said that UV curable technology has been garnering greater attention on a global scale. “In particular, sales for our Flash Dry series of UV inks, which was introduced to the China market in 2014, were brisk,” Nakano added. “Toyo Ink will continue to focus on developing new UV products to support the future of this strategic market.
“In addition, we’ve been seeing growth in water-based inks and eco-friendly printing techniques, driven by regulatory changes and increased awareness in the industry,” Nakano continued. “Specifically, we consider water-based flexo inks for flexible packaging and the healthcare markets as areas of future growth.”
Expectations for the Chinese Ink Market
Ink industry leaders see more opportunities ahead for the ink market in China.
“DIC expects the China ink market to continue to grow, especially in the packaging segment,” Tachibana said.
Kataura noted that Sakata INX is seeing increasing sales in offset inks, and anticipates adding a new facility in the next two years. “We anticipate the Chinese printing ink market to continue growing,” Kataura said. “We increased production capacity for offset ink at our Maoming plant in the Guangdong province at the end of 2014. Since sales are steadily increasing and the plant is nearing full capacity, we are planning to build a new facility near the existing plant in 2017.”
“China is second only to Japan in terms of total sales, making it a key market in the Toyo Ink Group’s global growth strategy,” Nakano said. “Western China presents further growth opportunities for the Toyo Ink Group as the infrastructure and consumer markets in this region continue to expand. In 2013, we launched a gravure factory in Chengdu, Sichuan province. An offset factory, Sichuan Toyo Ink, was newly set up in 2014, further increasing our presence in the region. Going forward, increases in offset production capacity are planned in the current fiscal year to meet demands of the inland markets.
“Looking ahead to fiscal year 2015, China is showing signs of easing growth,” added Nakano. “The economy is expected to see modest growth, though the outlook is uncertain given such factors as the stable growth policy in China and price fluctuations of raw materials.
“The Toyo Ink Group will continue to improve the quality and increase sales of gravure inks that support environmental consciousness and food hygiene, and flexo inks for flexible packaging,” Nakano concluded. “We will also drive the development of products that adapt to needs in growth areas by reinforcing our technological strengths in China and Southeast Asia, while putting our efforts into cost reduction through the integration of raw materials and basic prescriptions on a global scale. In the fall of 2015, offset ink production is slated to come on stream at Sichuan Toyo Ink. The new plant is expected to meet growing demand in the inland areas. Plans are also underway to produce UV inks and other high-performance products in China.”
This growth is driven by a variety of factors. The country’s population is estimated at 1.375 billion, nearly 20% of the world’s population. China has developed a sizable manufacturing base that caters to its domestic market as well as exports.
As a result, the printing market in China is also very strong, with common estimates of $150 billion. The Print Industries Market Information and Research Organization (PRIMIR), the market research association of NPES The Association for Suppliers of Printing, Publishing and Converting Technologies, calculated that the corrugated market alone in China was $26.5 billion in 2013, with folding carton at $10.7 billion and flexible packaging at $7.1 billion.
The printing industry continues to expand in China as well. In June 2015, Amcor Flexibles Asia Pacific completed its acquisition of Zhongshan Tiancai Packaging Company. This brings Amcor’s footprint in China to 10 manufacturing plants. As another example, Crown Holdings opened three new beverage can plants in China less than two years ago, with annual capacity estimated at more than four billion cans.
The Ink Industry in China
The ink industry is prominent in China with domestic and multinational ink manufacturers represented. Ink World estimates the Chinese ink market at $1.5 billion annually. Bauhinia Variegata Ink & Chemicals, a subsidiary of Yip’s Chemical, reported $207 million in sales in 2014, making it the 13th largest ink manufacturer in the world according to Ink World’s Top International Ink Companies report (July/August 2015).
Xinxiang Wende Xiangchuan Printing Ink Co., Ltd. and Letong Chemical Products Co., Ltd. both were among the top 20 companies in the report, with estimated sales of $100 million and $95 million, respectively.
Multinational ink industry leaders are active in China as well. DIC (China) Co., Ltd., a subsidiary of DIC Corporation, the world’s largest ink supplier, has approximately 40 locations in China, including seven ink manufacturing sites. Hangzhou Toka Ink, a joint venture with T&K Toka, and Tianjin Toyo Ink Co., Ltd., a JV with Toyo Ink, are among the five largest ink manufacturers in China.
Aside from DIC, among the billion-dollar global ink manufacturers, Flint Group has seven locations in China; Toyo Ink has 13 locations, eight of which manufacture ink; Sakata INX has three plants; Siegwerk has four sites; and hubergroup has two locations.
Chinese ink industry officials said that the past year brought further growth to their companies.
With annual production capacity of 95,000 metric tons, Bauhinia Variegata Ink & Chemicals specializes in offset inks, gravure flexible packaging inks for food and drinks, screen inks and UV inks. The company relies on its R&D team to develop new products that fit in with the growing interest in environmentally friendly products.
“Our R&D center consistently strengthens product development and improvement,” a company executive reported. “The demand for environmentally-friendly ink products has been increasing and the company has developed different kinds of ‘green’ products, for example water-based gravure lamination ink, to adapt to the market.”
Shogo Tachibana of the Corporate Communications Department at DIC Corporation noted that DIC has been present in China since 1919.
“It is now 30 years since DIC formed a joint venture for local manufacturing in China,” Tachibana added. “China is one of the most important markets for DIC, and DIC has been putting priority onto the ink business in this market. DIC opened a mother plant in Nantong and has been enhancing its capability.”
Tadashi Nakano, manager, Global Innovation Division at Toyo Ink Co., Ltd., noted that Toyo Ink has been active in the Chinese ink industry since 1926, when the company opened its first overseas branch office, Toyo Ink Manufacturing Co. in Shanghai, China.
“During the 1980s, we set up several local production and sales bases, reinforcing our commitment to the country,” Nakano added. “Today, we have a footprint of more than 10 production bases engaged in the production of offset, liquid, metal decorative and resist inks for LCDs, as well as can coatings, adhesives, plastic colorants and color filter pastes.”
Yuichi Kataura, GM of the International Operations Division of Sakata INX Corp., noted that Sakata INX has been active in China for nearly 20 years.
“China is one of the sites among multiple locations that we operate in Asia,” Kataura added. “We believe that expanding sales of packaging ink and offset ink is the key to growth in the Chinese market.”
China’s GDP growth has slowed, with the World Bank reporting that 2Q 2015 GDP growth was 1.70%. Nakano said that China’s economic slowdown further weakened the already-soft commercial printing market, but the packaging market flourished.
“Demand in markets further inland, however, remained strong,” Nakano observed. “As such, in recent years, the Toyo Ink Group expanded its gravure and offset production bases in western China to meet the demand growth.
“China’s packaging market experienced steady growth in 2014,” Nakano added. “This was driven by consumer demand for more sustainable and natural food and beverages as well as regulatory changes, resulting in a growth for eco-friendly inks. In particular, sales of our toluene-free, MEK-free inks, such as our MultiStar series of lamination gravure inks, remain strong in China and Southeast Asia.”
Kataura said the ink industry did slow somewhat in China last year.
“There wasn’t much growth in 2014, with 670,000 tons of printing ink sold, down 7.2% from 2013,” said Kataura. “We suspect the main reason was a slowdown of the Chinese economy with the implementation of a thrift ordinance, a decrease in domestic spending, and a decrease in exports because of the currency factor and an increase in labor costs. Despite all of these factors, the Chinese economy is expected to grow.”
Tachibana reported that China’s economic growth did slow some over the course of the past year.
“Thrift ordinance and government’s strict control over the government spending slowed down China’s economic growth, and due to this trend, printing and ink industry were negatively impacted,” Tachibana said. “Digitalization continuously affected total volume of publication, especially newspapers.”
Leading Printing Technologies in China
In terms of printing technologies, the printing industry remains largely offset- and gravure-based, but these are changing with the gains being made in flexo and inkjet. Kataura estimated that 40% of the Chinese ink market is sheetfed, 30% is gravure, 10% flexo and 20% divided among other technologies. Nakano added that sheetfed offset and UV printing are fairly strong, with gravure being the leading process for packaging printing.
“The UV ink and inkjet ink industry is definitely growing in China,” Kataura added.
“For publication, sheetfed offset and web offset remain the main technologies for commercial and newspaper printing,” Tachibana said. “For flexible packaging, gravure is the main technology, while flexo is starting to gain attention.”
Interest in the environment is leading to growth in UV and flexo printing.
“Under the condition of current government instruction to control environmental impact, flexo and UV are expected to grow,” Tachibana added. “Digital printing is expected to grow.”
Nakano said that UV curable technology has been garnering greater attention on a global scale. “In particular, sales for our Flash Dry series of UV inks, which was introduced to the China market in 2014, were brisk,” Nakano added. “Toyo Ink will continue to focus on developing new UV products to support the future of this strategic market.
“In addition, we’ve been seeing growth in water-based inks and eco-friendly printing techniques, driven by regulatory changes and increased awareness in the industry,” Nakano continued. “Specifically, we consider water-based flexo inks for flexible packaging and the healthcare markets as areas of future growth.”
Expectations for the Chinese Ink Market
Ink industry leaders see more opportunities ahead for the ink market in China.
“DIC expects the China ink market to continue to grow, especially in the packaging segment,” Tachibana said.
Kataura noted that Sakata INX is seeing increasing sales in offset inks, and anticipates adding a new facility in the next two years. “We anticipate the Chinese printing ink market to continue growing,” Kataura said. “We increased production capacity for offset ink at our Maoming plant in the Guangdong province at the end of 2014. Since sales are steadily increasing and the plant is nearing full capacity, we are planning to build a new facility near the existing plant in 2017.”
“China is second only to Japan in terms of total sales, making it a key market in the Toyo Ink Group’s global growth strategy,” Nakano said. “Western China presents further growth opportunities for the Toyo Ink Group as the infrastructure and consumer markets in this region continue to expand. In 2013, we launched a gravure factory in Chengdu, Sichuan province. An offset factory, Sichuan Toyo Ink, was newly set up in 2014, further increasing our presence in the region. Going forward, increases in offset production capacity are planned in the current fiscal year to meet demands of the inland markets.
“Looking ahead to fiscal year 2015, China is showing signs of easing growth,” added Nakano. “The economy is expected to see modest growth, though the outlook is uncertain given such factors as the stable growth policy in China and price fluctuations of raw materials.
“The Toyo Ink Group will continue to improve the quality and increase sales of gravure inks that support environmental consciousness and food hygiene, and flexo inks for flexible packaging,” Nakano concluded. “We will also drive the development of products that adapt to needs in growth areas by reinforcing our technological strengths in China and Southeast Asia, while putting our efforts into cost reduction through the integration of raw materials and basic prescriptions on a global scale. In the fall of 2015, offset ink production is slated to come on stream at Sichuan Toyo Ink. The new plant is expected to meet growing demand in the inland areas. Plans are also underway to produce UV inks and other high-performance products in China.”