Narrow Web Europe

Narrow Web Europe

November 28, 2005

Narrow Web Europe

Gallus acquires a stake in folding carton technology

By Barry Hunt

It’s easy to see how producing small folding cartons on reelfed presses, rather than on sheetfed offset presses, can offer real economic advantages. Also, the best of UV flexo will readily match offset quality. Yet, despite the best efforts of most narrow web press manufacturers, it represents a different type of culture and consequently has never achieved mainstream acceptance, or not at least among European converters. Therefore, it’s interesting that the Gallus Group should take a sideways move into this sector by buying a 30 percent stake in BHS Druck- und Veredelungstechnik GmbH. BHS is a familiar name among midweb and wide web packaging printers as a manufacturer of high end shaftless presses and converting machines. The company has a turnover of €28 million ($33.60 million) and employs 120 people.

Gallus Group will integrate its folding carton business within an autonomous business unit. The deal also gives it useful access to BHS’s expertise in high quality diecutting technology. Cutting and creasing thin, preprinted carton board at speed, with integrated waste handling and conveying procedures, tends to divide the men from the boys. It is also possible to recognize a synergy with Heidelberg’s sheetfed range of offset carton presses, including postpress systems. As is widely known, the German press manufacturer holds a 30 percent stake in the Gallus Group. Therefore, by association, the BHS deal opens up several possibilities for all concerned in the webfed packaging world.

Boost for Scandinavian label stock manufacturing

Economic pessimism does not seem to be inhibiting certain self-adhesive label stock manufacturers. Raflatac announced that it would double its current filmic label production at the Tampere mill in southern Finland by adding an extra coater. It becomes operational in the third quarter of 2006. In October its near neighbor, Scandstick, said it had completed a 6.5 foot wide coating and siliconizing line at its Helsingborg mill in southern Sweden. The 65-yard long coater represents the first phase of a €40 million ($48.39 million) investment program and is the largest in the company’s 24-year history.

The coating line includes a fully automated hot melt adhesive metering and application system, as well as the latest computerized control and inspection systems. It will process various film and paper label stocks. The investment includes three new slitters and a factory extension of the Swedish factory by 43,000 square feet. Scandstick is currently developing at its UK mill in Sawtry, Cambridgeshire, which produces self-adhesive and dry gum labelstocks.

Season for price hikes well under way

Take a generous pinch of weak economic conditions, throw in the global aftermath of natural disasters, and mix together with some serious supply problems with oil based raw materials. The result is a predictable hike in prices. European examples include the likes of Rohm & Haas, which makes the ingredients for all types of adhesives and coatings. It blames the prices it pays for its own raw materials and petrochemical products, as well as energy and freight related costs. It does not see any lessening of their effects until well into 2006. Stora Enso Speciality Papers has said its European customers will pay an extra 5 percent for all wet strength label papers and flexible packaging papers delivered from January 1, 2006. Adapack, a producer of coated one-side papers for labels and flexible packaging, blames soaring manufacturing costs for price increases equivalent to $72 to $133 per ton for all its paper grades.

Film manufacturers are particularly affected by a shortage of refined petroleum and higher costs. Its byproducts include ethylene, propylene and styrene monomers that are used to produce commodity plastic resins. Recent polyethylene price increases are now filtering through the supply chain.

Moira McMillan, CEO of the British Coatings Federation, specifically warns that the labeling and packaging markets should expect further rises in printing ink prices. A major factor has been the doubling of the cost of crude oil compared to a year ago, although the problem of reduced refining capacity in the USA seems to have eased slightly.

“Ink manufacturers have been holding prices while current stocks last, but in a very difficult market they cannot absorb cost increases of this magnitude for any significant length of time,” she says. The hike in ink prices in the USA and Canada across the various commercial and packaging ink sectors has not gone unnoticed.

Booklet labels with smart approach

The RFID bandwagon rolls on with several ingenious approaches to integrated production now becoming available. Among the latest is the so called Intelligent Converter, introduced at Labelexpo by the Switzerland based GRE Engineering Products. The company is better known for refurbishing second-hand Gallus presses, as well as building customized booklet label retrofits for all types of label presses. In a sign of the times it is also targeting the RFID market by offering retrofit kits for most webfed label presses. The machine shown produced a 10-page zigzag folded, four-color “smart” booklet label. It was based on a multiweb Gallus R200 press adapted to include a Longford RFID inlay feeder and chip verifier, a two-color VP2020 UV inkjet printer from VIPcolor, UV varnisher, and foil and hologram stamper.

The group’s Digital Solutions Division has also signed an agreement with Impika, a French manufacturer of high resolution drop-on-demand UV inkjet modules for labels, mailers and document processing. Its IPS C-9000, for example, prints at up to 900dpi at up to 78 feet per minute. GRE Digital plans to develop new types of high end digital color printing lines using VIPcolor and/or Impika modules, incorporating such ancillaries as Longford RFID insetters and laser cutters from Cartes Equipment.

GEW’s India hub serves Asia expansion

India’s global influence on manufacturing and service industries will soon include UV curing systems for label presses. GEW (EC) Ltd. has started work on establishing a sales, service and manufacturing operation in Mumbai. Besides serving the Indian subcontinent, it will also cover sales in South East Asian markets. It becomes operational in early 2006, while Phase Two will follow a year later with full manufacturing and assembly operations.

The extra production capacity should relieve pressure at the firm’s UK headquarters located in Redhill, Surrey. Demand for GEW’s UV systems is expected to rise with the launch of the e-Brick system, which claims marked reductions in radiated energy at lower energy costs without using a conventional transformer. The company also intends to compete head-on with arch-rivals like IST Metz and expand into the sheetfed offset markets.

Malcolm Rae, managing director, says it is important to remain competitive to meet an expected demand for UV curing systems in the region. “We do not intend to diminish our UK operation, as it will continue to serve our important European and American activities. Major factors in our decision include the ready availability of manufacturing materials and highly educated individuals in India, all of whom are fully fluent in English and other Asian languages.”

He says GEW had evaluated several Asian countries, but India showed the greatest potential as the hub of a new Asian operation. The company plans to establish sales and support personnel in all the major Asian markets.

Rae, who formed the company with his wife Gillian in 1991, says the expansion would help reduce the effects of an acute shortage of qualified personnel, including engineers: “Smaller companies like ours find it hard to compete with the larger national engineering groups in attracting skilled personnel,” he says. This partly reflects an overheated housing market throughout southeast England. The group includes a US subsidiary, GEW Inc., located in Ohio, and an office in Germany to serve German-language markets.

Flint-Schmidt divests metal decorating business

Flint-Schmidt, part of the recently combined group of Flint Ink and XSYS Print Solutions, is selling its metal decorating business to the division’s senior management for an undisclosed sum. It is headed by Jan Koivula, who has held a similar position for the past three years. The transaction includes the purchase of Flint Ink Sweden AB, the factory in Helsingborg, a service center and in-plant operations around Europe.

The agreement calls for approximately 60 employees to move from Flint-Schmidt to the new company.

In a complementary transaction, the new company has agreed to acquire the metal decorating business owned by XSYS, formerly known under the brand name, Lindgens.

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