The surprising thing about Europe’s narrow web press manufacturers is not that some of them have gone out of business this year, but that so many of them haven’t.
Gaetan de Charry, sales director of Spain’s Rotatek, reckons that being present on several continents has helped the company to survive. “We’re strongly placed in Brazil, in India, and of course in most of the Spanish-speaking countries. Sales of narrow web ticket printing machinery have held up well during the crisis; people haven’t stopped taking public transport and they still buy lottery tickets. We are fortunate in having relatively low fixed costs when compared with many of our competitors. The big change for us is that we used to expect our customers to arrange financing – now every sale involves spending a lot of time and effort putting together the financial package.”
For Britain’s Edale, the present (and the future) is characterized by a move towards custom-built printing and converting machinery for niche applications. “We still make and sell our Alpha flexo presses, which are small, flexible and cheap to run,” says export manager Bernhard Grob. “But in today’s environment, security applications play a key role for us – security and digital. Edale’s digital involvement is two-fold: First there’s our single color inkjet combined with flexo, and second our partnership with Agfa in developing a multicolor digital press aimed at a much wider range of applications then just labels. By offering printers a more diversified range of applications, we are convinced that these presses give a better return on investment and enhanced productivity.”
When the economic crisis hit last year, Dutch press maker MPS took it on the chin. “Yes, we had to lay off staff and scale back,” says CEO Eric Hoendervangers, “but now we’re back in business with a vengeance. We showed three new presses at Labelexpo Europe and sold no less than 12 presses at the show or immediately after.”
For whom the bell tolls
One of the hotly discussed topics in the run-up to Labelexpo Europe was whether Nilpeter would risk continuing its practice of ringing a bell for every press sold at the show. For Nilpeter, this has the double advantage of encouraging its own staff while at the same time annoying all competitors within earshot. The risk of this gambit is that failure to conclude many sales during the show becomes painfully obvious to all and sundry. The Danes took the risk, and it paid off. “Twenty-one bells this year,” says an exuberant Jakob Landberg after the show “that exceeds our most optimistic forecast. But more than that we all had the feeling that the industry has turned the corner, and that many of the prospective sales discussed during the show will be concluded over the months to come.”
Ever since the first ecologist looked in horror at a pressure-sensitive label, the industry has been trying to grapple with the problem of what to do with waste liner. The problem is global, with over 30 billion square meters per year looking for a final resting place. Landfill is now forbidden or severely restricted in many European countries; thermal recycling (which you and I call burning the stuff as fuel) is the next best option, but as eco-expert Calvin Frost of Channeled Resources has observed, the jury is still out on whether thermal recycling is good or bad for the planet.
Everyone knows that the problem with used PS liners is in the silicone and the traces of adhesive. Glassines and other natural fiber-based liners cannot easily be pulped and reused in the paper industry. Used synthetic liners can, we are told, be reborn as “woolly” jumpers, but they account for less than 15 percent of all liners used in Europe’s PS label industry.
Now Petri Tani from Finland reckons he has found an innovative and economical way of de-siliconizing paper-based liner so that it can be 100 percent recycled as cellulose pulp. Tani has joined forces with Frost to initiate a “Life Cycle” scheme in Europe that includes the collection of spent liner, repulping and removal of silicone, and then the sale of the pulp to selected base paper manufacturers. Tani and Frost will present their progress at the next Global AWA Release Liner Conference in Amsterdam in the spring of 2010.
This show, which closed in Nuremberg on October 1, is less international than Labelexpo Europe, but nonetheless it attracts many exhibitors from the label sector. According to the results of a survey by an independent institute, the visitors to the exhibition came from the full range of end-user industries including food/beverages, pharmaceuticals/cosmetics, packaging and logistics-related services, chemicals, printing/paper processing and electrical equipment manufacture.
Swiss label specialist Pago exhibited hologram security labels, booklet labels and sleeves at the show, while Austria’s Ulrich Etiketten profiled heat-sensitive and luminescent labels. Schreiner, the leading German label converter who recently opened a plant in New York State, focused on security solutions, in particular its recently acquired Copy-Detection-Pattern Technology. Not to be outdone, Rako, another contender for the title of Germany’s top label group, used Fachpack to show its range of PS labels, flexible packaging and assorted labeling software. Despite the economic slowdown, Fachpack-Printpack registered an independently controlled total of 34,000 visitors, unchanged from the previous event in 2007.
Many readers may not have heard of the International Label Group, which met in Brussels on the eve of the recent Labelexpo show. They are all users of the technology developed by ETI Converting (Canada) which enables narrow web converters to make their own labelstock. At the recent meeting in Brussels, ETI’s Frédéric La Brie claimed that his company had not been affected by the recession, but had continued to register rising sales.
Not all users of ETI’s Cohesio agree on the percentage of the raw material economies which the machine can bring (ETI talks of 30 to 40 percent cost savings). A leading French label converter, however, has progressively installed ETI’s machines in all its plants, and the International Label Group is steadily increasing its membership. As CEO François Bayzelon remarked modestly after the meeting, “We must be doing something right.”
BOPP over the top?
Bi-axially oriented polypropylene, or BOPP, is used extensively in the European label sector, and its usage rose rapidly over the years 2003-2007. However, demand for BOPP film in Western Europe suffered a 3.1 percent fall in volume in 2008 (actually a rise in the first 6 months and then a sharp fall in the second) following recessionary pressures and changes in purchasing patterns, according to a new study by PCI Films Consulting. Over the next five years, PCI believes, there will be a strategic shift in the balance of power away from the traditional suppliers of BOPP film. Manufacturers like Treofan and ExxonMobil, still the main market leaders, will have to make room for new players from Turkey, India, China and the Middle East. PCI notes by way of example that over the last five years Dubai-based Taghleef has invested in new low-cost equipment and also bought regionally based assets such as Radici Film (Italy), to emerge as one of the world’s largest BOPP film producers with a worldwide network of supply.
In the next five years, it is expected that an additional 2.3 million tonnes of new BOPP film capacity will be commissioned, expanding the industry’s capacity by a third. Even if market growth for BOPP films in Europe resumes its pre-2008 growth rate, there will continue to be over-capacity for several years to come.
More mergers in France
When France’s Autajon acquired the Belgium-based Bopack Group earlier this year, it sent a shiver down the spines of other leading players on the French label scene. Now comes news of another cross-border cooperation agreement linking French label converter JPL with the Switzerland-based (but international) group Pago.
Under the terms of the deal, Pago will acquire 34 percent of the equity in JPL (which currently has around 5 percent of the French label market). Some but not all the two partners’ production plants in France will be merged into a new organization, which will specialize in multi-page booklet labels. Pago has more than 1,000 employees and plants in eight European countries; JPL employs 180. Both are family-owned businesses. This latest move is a healthy sign that M&A activity in Europe is picking up, but also (perhaps) an indication that the days of the single-country label converter are numbered.
Digital beer labels
Selling digital labels to megabrewer Heineken sounds like a non-starter, but Dutch label converter Eshuis has done just that in a joint marketing operation. Visitors to Heineken’s Dutch-language website can design their own beer labels, which are then digitally printed as shrink sleeves by Eshuis. Heineken is actively promoting this operation in order to attract people to its website. For Eshuis, this novel marketing idea has meant additional business totaling over half a million attractively priced sleeve labels since the scheme was launched early this year.
National label associations
When the Italian label association GIPEA met for their annual congress, they had ample confirmation of the bad news: Italy’s PS label sales were 9 percent down in the first quarter of 2009, compared with the same quarter of 2008. Only food and pharmaceutical labels maintained their 2008 sales levels, said association president Alfredo Pollici. Inevitably, the environment figured large on the program of the association’s two-day meeting, which ended on a lighter note when all the delegates took part in a “game” to promote lateral thinking.
Spain’s national label association ANFEC also brooded on the crisis when it held its annual meeting: The country now holds the unenviable record for unemployment in Europe, with 19 percent of the Spanish labor force now out of a job. However, the Spanish association also started gearing up for the two major events which it will co-host with FINAT next year: the FINAT Technical Seminar in Barcelona in March, and the FINAT congress in Valencia in June.
The French label association UNFEA traditionally holds a gala dinner for its members during the Labelexpo event in Brussels, and this year’s gathering was particularly well attended, so much so that all the tables were taken and they were turning people away.
This may – or may not – reflect French thinking in times of adversity.