Label demand in the US is projected to reach US$19 bln in 2017, with growth accelerating from the 2007-2012 performance based on a strengthened economy. The pressure sensitive segment will remain dominant, accounting for more than 75% of the total market. Although pressure sensitive labels will expand at a healthy rate, they will continue to face growing competition from alternative labeling methods for primary packaging, such as stretch sleeve and heat-shrink, and in-mold labels. Among these, heatshrink labels will experience the fastest growth through 2017, with gains attributable to their ability to form-fit contoured containers and their strong visual appeal afforded by 360-degree graphics and maximum promotional area. While paper will continue to account for the majority of label stock through 2017, plastics will continue to expand their share at paper's expense. The growing use of plastic materials is based on the aesthetic and performance advantages of these labels, as well as the rising utilization of plastic packaging. Additionally, labeling methods that rely heavily on plastic substrates are increasingly popular. A key advantage of film labels is their transparency, which allows products packaged in glass or clear plastic containers to be viewed through the label, achieving the desirable no-label look. The no-label look is also increasingly popular with opaque plastic containers, especially in cosmetic and toiletry applications. Nonetheless, paper label demand will benefit from cost savings and the ability to be coated for enhanced durability. The vast majority of labels are printed in some manner before sale to the final user, and additional printing, such as bar coding or addressing, may be done on site by the customer. Flexography is the leading printing technology in the US and is forecast to log above average growth through 2017, driven by its versatility, low cost, and suitability with the large pressure sensitive segment and the faster growing sleeve label segment. However, double digit annual growth is anticipated for digital printing, which will continue to displace traditional label decoration techniques, such as lithography and flexography. Advances will reflect improvements in print quality and speed that will fuel growing adoption of this technology by label converters and printers. Among the advantages of digital printing are increased design flexibility, shortened lead times, and low costs, especially for short run projects, since there are no plate charges or setup fees that add to the cost of traditional commercial printing. As a result, the use of these presses will be driven by efforts to capitalize on trends favoring shorter label runs and mass customization, particularly as product personalization functions as a key marketing tool. Although material consumption will be similar to expected volume growth in label production, gains will be moderated by ongoing efforts to lightweight and downgauge label materials, as well as trends favoring less dense stock materials such as polypropylene. At the same time, raw material demand will be aided by the material-intensive nature of pressure sensitive labels due to the incorporation of adhesives and release liners.
US label shipments are forecast to rise 4.8% pa to US$20 bln in 2015, as per Freedonia. The pressure sensitive segment will continue to dominate output, accounting for more than 70% of the total. Although pressure sensitive labels will expand at a healthy rate, they will continue to face growing competition from alternative labeling methods such as stretch sleeve, heat-shrink and in-mold labels. Among these, heat-shrink labels are projected to advance at the fastest rate through 2015, with gains attributable to their ability to form-fit contoured containers, providing 360-degree graphics and a broad promotional area which enable consumer products to stand out on crowded store shelves. Paper will remain by far the leading stock material in the label industry for the foreseeable future. However, it will continue to lose market share to plastic, which will account for more than one-quarter of label shipments in 2015. Plastic stock materials will gain popularity due to their aesthetic and performance advantages over paper, as well as a broad shift in favor of plastic packaging. Moreover, plastic is heavily utilized in pressure sensitive, heat-shrink, stretch sleeve, in-mold and thermal transfer labels, each of which is expected to grow at a healthy rate. Among plastic label resins, polypropylene and polyvinyl chloride are widely used, although the latter will lose out to other plastic substrates with lower perceived environmental and health risks. In particular, trends favoring more environmentally friendly substrates will propel gains for polylactic acid, albeit from a very small base. Primary packaging represents the leading application for labels in the US market. Label demand in this sector will be driven by a shift in product mix favoring higher-value label types (including large, full-body labels, plastic labels and those featuring higher-end inks and printing technologies), as labels play a crucial role in the building of brand identity in an intensely competitive consumer product marketplace. However, the secondary packaging and mailing and shipping segments will achieve more rapid demand gains. In secondary labeling, advances will be supported by the penetration of barcoding labels in the transportation and distribution sector, along with the significant potential for smart labeling markets such as food safety applications.