A new report from industry consultants, AMI Consulting, published this month, highlights the dynamic structural changes that have been occurring in the European label industry in recent years.
Despite the economic hardships of recent years, plastic label demand grew on average by 6 per cent per year since 2008. While the end-use applications are relatively mature in Europe, plastic labels converters are taking market share from paper at an increasing rate. The increasing penetration of plastic labels is driven by:
· Improved brand positioning;
· More frequent brand revamps;
· Paper/pulp price volatility;
· Technological advancements and increased production efficiency driving cost reduction;
· Film down-gauging further reducing the overall cost of plastic labels;
· New market entrants;
· Recycling initiatives promoting mono-material packaging (i.e. all plastic);
Plastic glue applied labels illustrated the paper to plastic transition best, through the wrap around labels in the beverage industry, which resulted in 400 million square meters additional demand in the past three years. Plastic dominates the in-mould labels segment as well.
In self-adhesive labels, the key issue is inter-material competition of PP and PE. PP is expanding penetration, driven by the growing demand of clear-on-clear labels allowing for no-label look. Similarly, PET increased its penetration versus PVC in shrink sleeves.