Yogi Malik, Asia Correspondent11.12.19
Changing consumption patterns, increased competition from Chinese ink suppliers and declining demand in the domestic market have been some of the hallmarks of the Malaysian ink industry in recent years. Multinational and domestic ink producers are struggling to retain their share of the market pie.
Overview of the Malaysian Ink Industry
With a population of nearly 32 million in 2018, Malaysia is the smallest among the four major South East Asian countries. However, the country has the highest per capita income among the four major ASEAN countries.
The country’s economic growth has averaged above 5% over the past five years, leading to higher per capita income and reducing already low poverty. However, despite all the right ingredients for development, the country’s ink industry hasn’t been able to achieve its true potential.
Currently, the industry is served by approximately 20 ink producers, including most of the leading names in the global ink industry. Dominated by Japanese companies Toyo Chem, DIC Corporation and Sakata INX, European companies Siegwerk and hubergroup and domestic producer Swan Coatings, Malaysian ink producers have a cumulative output of nearly 40,000 metric tons per year.
During the last three years, the ink industry in Malaysia has declined by about 5% per year. Flexo and gravure ink own the biggest market share in Malaysia due to high demand in food packaging.
Demand for conventional offset inks is shrinking due to this generation’s shift to electronic reading materials; with high raw material and labor costs, most of the time it is cheaper to import the ink directly. Labor resources are also a problem in Malaysia for ink producers.
Ink producers in Malaysia are experiencing increased competition from Chinese ink producers and other ASEAN producers and tremendous pressure to decrease prices. The low price situation, alongside escalating raw materials costs, is causing a further profit squeeze in the industry. One of the stakeholders with a leading ink producer told Ink World on the condition of anonymity, “Industry profits are so low that it may be impossible for some companies to continue surviving.”
Toshihiko Ogawa, chairman, Toyochem Specialty Chemical Sdn. Bhd. told Ink World, “ We are known for our high-quality offset inks, liquid inks, adhesives and other resin-based products, all of which are produced at two factories within the country. Our adhesives business offers laminating adhesives and pressure-sensitive adhesives to the flexible packaging, labels, tapes and specialty film markets in Malaysia and its neighboring countries.”
Regarding the state of the Malaysian ink industry and challenges faced by the producers, Ogawa said, “In general, publication is on a downward trend, as is the demand for paste inks. However, packaging has been stable and is likely to remain stable, though the environmental pressures on the industry are increasing. The market expectations for printed and packaged items are evolving quickly both domestically and globally. One of our greatest challenges is offering solutions to customers that respond to their increasingly diversified demands such as for greater functionality, operational efficiency and environmental benefits. Cost initiatives and stable supply are also major challenges, which require close collaboration with raw material suppliers, brand owners and other partners.”
Toyo Ink Group
Toyo Ink Sdn Bhd and Toyochem Specialty Chemical Sdn. Bhd, group companies of Toyo Ink Group, operate in Malaysia. Toyo Ink Sdn Bhd was formerly known as Toyoink (M) Sdn Bhd and changed its name to Toyo Ink Sdn Bhd. The company’s production facility is located in Seri Kembangan, with sales offices in Perak, Penang, Ipoh and Johor Bharu.
Toyo Ink Sdn Bhd manufactures and markets gravure (solvent-based) and flexographic (water-based) printing inks for printing and packaging industries in Malaysia. Products from the company are supplied to a wide variety of industries, including consumer goods, industrial products and printing industries.
It also offers offset inks, varnishes, masterbatch (a mixture of pigments in granular shape), glasurit (automotive refinishes), printing consumables and equipment. Utilizing the palm oil resources of Malaysia as a raw material, the company has introduced Palm Eco GRP inks in the country. These inks are designed for food packaging, sanitary products and cigarette packaging in paper application. It is eco-friendly, wherein the organic solvents are mainly alcohol and ester-based.
In 2018, Toyo Ink Malaysia ceased business operations of Toyo Dai-Nichi Ink Sdn Bhd, its joint venture with Dainichieika Color & Chemicals Mfg Co Ltd, which produced printing inks.
“We will now concentrate more on inks for the packaging division to make up for the loss in revenue from the printing division,” Toyo Ink Group managing director Song Kok Cheong said during the company’s annual general meeting.
The other group company of Toyo Ink Group, Toyochem Specialty Chemical, manufactures and markets offset inks, gravure inks and polymer products such as adhesives to printing, packaging and industrial markets in Malaysia and throughout Asia. As one of the leading ink producers in Malaysia, the company delivers products made at two factories within the country – the Shah Alam Plant in Selangor and the Seremban Plant in Negeri Sembilan.
Toyochem Specialty Chemical is a wholly-owned subsidiary of Toyo Ink SC Holdings Co., Ltd., the parent of the Toyo Ink Group of Japan.
TSC also provides services to the graphic art industry and acts as agents of graphic art film and other related printing products. TSC was previously established in 1996 under the name of Toyo Ink Pan Pacific (Malaysia) Sdn. Bhd. (TIPPM in short), focusing on manufacturing of resins and pressure-sensitive adhesives in Seremban, Negeri Sembilan. In September 2009, TIPPM renamed itself to TSC as part of the corporate exercise to merge with two related companies – Toyochem Sdn. Bhd. (TSB) and Toyochem Printing Chemical Sdn. Bhd. (TPC) – via take-over.
Sakata Inx Malaysia
Established in 1993 as a wholly-owned subsidiary of Sakata Inx Corporation, Sakata Inx (Malaysia) Sdn Bhd is located at Shah Alam in Malaysia. The company has opened branches in Johore Bahru and Melaka and a representative office in Myanmar. The company produces gravure and flexo ink products in Malaysia.
“In 2019, there was not much overall growth due to slow local demand and reduced export competitiveness,” management of Sakata Inx (Malaysia) Sdn Bhd said. “On the positive side, some Japanese companies bought printers in Malaysia and may be looking at future development. Our production facility in Malaysia is spread over 7,000 meters and has 101 employees. In business for 26 years, we produce flexo and gravure inks. Flexo product lines include water-based ink for high-end carton and water-based OP varnish. Gravure product lines include back printing ink for laminating, non-toluene and surface printing inks.”
Overview of the Malaysian Ink Industry
With a population of nearly 32 million in 2018, Malaysia is the smallest among the four major South East Asian countries. However, the country has the highest per capita income among the four major ASEAN countries.
The country’s economic growth has averaged above 5% over the past five years, leading to higher per capita income and reducing already low poverty. However, despite all the right ingredients for development, the country’s ink industry hasn’t been able to achieve its true potential.
Currently, the industry is served by approximately 20 ink producers, including most of the leading names in the global ink industry. Dominated by Japanese companies Toyo Chem, DIC Corporation and Sakata INX, European companies Siegwerk and hubergroup and domestic producer Swan Coatings, Malaysian ink producers have a cumulative output of nearly 40,000 metric tons per year.
During the last three years, the ink industry in Malaysia has declined by about 5% per year. Flexo and gravure ink own the biggest market share in Malaysia due to high demand in food packaging.
Demand for conventional offset inks is shrinking due to this generation’s shift to electronic reading materials; with high raw material and labor costs, most of the time it is cheaper to import the ink directly. Labor resources are also a problem in Malaysia for ink producers.
Ink producers in Malaysia are experiencing increased competition from Chinese ink producers and other ASEAN producers and tremendous pressure to decrease prices. The low price situation, alongside escalating raw materials costs, is causing a further profit squeeze in the industry. One of the stakeholders with a leading ink producer told Ink World on the condition of anonymity, “Industry profits are so low that it may be impossible for some companies to continue surviving.”
Toshihiko Ogawa, chairman, Toyochem Specialty Chemical Sdn. Bhd. told Ink World, “ We are known for our high-quality offset inks, liquid inks, adhesives and other resin-based products, all of which are produced at two factories within the country. Our adhesives business offers laminating adhesives and pressure-sensitive adhesives to the flexible packaging, labels, tapes and specialty film markets in Malaysia and its neighboring countries.”
Regarding the state of the Malaysian ink industry and challenges faced by the producers, Ogawa said, “In general, publication is on a downward trend, as is the demand for paste inks. However, packaging has been stable and is likely to remain stable, though the environmental pressures on the industry are increasing. The market expectations for printed and packaged items are evolving quickly both domestically and globally. One of our greatest challenges is offering solutions to customers that respond to their increasingly diversified demands such as for greater functionality, operational efficiency and environmental benefits. Cost initiatives and stable supply are also major challenges, which require close collaboration with raw material suppliers, brand owners and other partners.”
Toyo Ink Group
Toyo Ink Sdn Bhd and Toyochem Specialty Chemical Sdn. Bhd, group companies of Toyo Ink Group, operate in Malaysia. Toyo Ink Sdn Bhd was formerly known as Toyoink (M) Sdn Bhd and changed its name to Toyo Ink Sdn Bhd. The company’s production facility is located in Seri Kembangan, with sales offices in Perak, Penang, Ipoh and Johor Bharu.
Toyo Ink Sdn Bhd manufactures and markets gravure (solvent-based) and flexographic (water-based) printing inks for printing and packaging industries in Malaysia. Products from the company are supplied to a wide variety of industries, including consumer goods, industrial products and printing industries.
It also offers offset inks, varnishes, masterbatch (a mixture of pigments in granular shape), glasurit (automotive refinishes), printing consumables and equipment. Utilizing the palm oil resources of Malaysia as a raw material, the company has introduced Palm Eco GRP inks in the country. These inks are designed for food packaging, sanitary products and cigarette packaging in paper application. It is eco-friendly, wherein the organic solvents are mainly alcohol and ester-based.
In 2018, Toyo Ink Malaysia ceased business operations of Toyo Dai-Nichi Ink Sdn Bhd, its joint venture with Dainichieika Color & Chemicals Mfg Co Ltd, which produced printing inks.
“We will now concentrate more on inks for the packaging division to make up for the loss in revenue from the printing division,” Toyo Ink Group managing director Song Kok Cheong said during the company’s annual general meeting.
The other group company of Toyo Ink Group, Toyochem Specialty Chemical, manufactures and markets offset inks, gravure inks and polymer products such as adhesives to printing, packaging and industrial markets in Malaysia and throughout Asia. As one of the leading ink producers in Malaysia, the company delivers products made at two factories within the country – the Shah Alam Plant in Selangor and the Seremban Plant in Negeri Sembilan.
Toyochem Specialty Chemical is a wholly-owned subsidiary of Toyo Ink SC Holdings Co., Ltd., the parent of the Toyo Ink Group of Japan.
TSC also provides services to the graphic art industry and acts as agents of graphic art film and other related printing products. TSC was previously established in 1996 under the name of Toyo Ink Pan Pacific (Malaysia) Sdn. Bhd. (TIPPM in short), focusing on manufacturing of resins and pressure-sensitive adhesives in Seremban, Negeri Sembilan. In September 2009, TIPPM renamed itself to TSC as part of the corporate exercise to merge with two related companies – Toyochem Sdn. Bhd. (TSB) and Toyochem Printing Chemical Sdn. Bhd. (TPC) – via take-over.
Sakata Inx Malaysia
Established in 1993 as a wholly-owned subsidiary of Sakata Inx Corporation, Sakata Inx (Malaysia) Sdn Bhd is located at Shah Alam in Malaysia. The company has opened branches in Johore Bahru and Melaka and a representative office in Myanmar. The company produces gravure and flexo ink products in Malaysia.
“In 2019, there was not much overall growth due to slow local demand and reduced export competitiveness,” management of Sakata Inx (Malaysia) Sdn Bhd said. “On the positive side, some Japanese companies bought printers in Malaysia and may be looking at future development. Our production facility in Malaysia is spread over 7,000 meters and has 101 employees. In business for 26 years, we produce flexo and gravure inks. Flexo product lines include water-based ink for high-end carton and water-based OP varnish. Gravure product lines include back printing ink for laminating, non-toluene and surface printing inks.”