The Development Trends of the Global Specialty Paper Industry
According to the latest research by Smithers Pira, the market size of global specialty papers will reach 25.03 million tons in 2019. In the meantime, the total global production of paper and paperboard is estimated to exceed 450 million tons. In contrast, specialty paper will bring more and more profitable opportunities for established specialty paper suppliers and large-scale manufacturers seeking diversification.
The research studies the market of more than 40 types of specialty papers. One of its results is that by 2024, the market capacity of specialty paper will reach 28.02 million tons, with a compound annual growth rate of 2.3%.
The strongest growth of market capacity will appear in the Asia Pacific region, with an expected annual growth rate of 3.8%. Meanwhile, the region is also the world's largest market, in which the market capacity of China and India is increasing particularly strong.
After analysis, Smithers Pira concluded five key points for the market development that will help the insiders learn the future of the global specialty paper industry.
As the stable contraction of commodity printing and writing businesses and newsprint businesses in North America and Western Europe for years, many companies are exploring the way to enter the specialty paper arena. Commercial paper mills or newsprint paper mills in these regions have switched to specialty papers. New chemicals and improved process technologies enable machines to produce specialty paper more efficiently and economically. However, not all such switches have been successful and some of these plants have been closed.
This situation has brought new pressure to the industry companies, especially those that are active in slower-growing segments. Some old specialty paper companies have either been closed or have become part of the M&A trend. Some veteran manufacturers such as Appvion and Arjowiggins are facing bankruptcy or being taken over. Recently, the Scandinavian Investment Group acquired Zanders Paper of Germany, making this historic factory to survive.
In 2018, the flexible package accounted for about 20% of the market. This year, it remains the largest segment of sales, being one of the parts that have the highest expected growth rates. The growth is also supported by environmental regulations. The strict waste packaging requirements in many areas of the EU are bringing new opportunities to the market. In some areas, the replacement of paper to plastics will continue to accelerate. One example is that plastic straws have recently been banned in some US cities.
Machine-glazed paper is widely used for lamination, coating, metallization and conversion into a variety of flexible packaging materials. Although the cost of wax paper is relatively low, it is gradually losing market share, as some traditional applications have now chosen to use products with better barrier properties.
Oil and grease resistant paper (OGR) continues to be popular. Through extensive research and development, OGR uses an available water-based substitute to be the barrier coating, which will make it more commercial with a wider supply channel. Therefore, the prices of this kind of products are usually significantly lower than high-quality grease-proof paper.
New product development in the food contact application area continues to focus on the commercialization of water-based barrier coatings, pushing it to replace fluorocarbons, which has a higher price and doubtful impact on the environment. Many major chemical companies are looking for various patented innovation solutions, some of which are being implemented on a commercial basis.
Both chemical suppliers and paper producers are undertaking a large number of R&D investments and patent activities to advance the application of engineered nanoparticles in size reduction and surface coating, which enables the paper to be grease-resistant and environmentally friendly.
Thermal Paper & Ink-jet Paper
The explosive growth of online shopping and product transportation has driven the corresponding growth in thermal transfer labels, direct thermal labels and digital printing labels.
In the label industry, plastic film has gained some market share because of its flexibility, durability and moisture resistance. However, paper remains common in the industry.
The thermal paper market is expanding. With the increase of freight charge and the search for lighter weight, the lightweight opaque paper continues to be popular in several developing regions. The main challenge of the industry is still to develop the BPA-free coating formula, as the chemical has caused negative news and met stricter regulations in North America and Europe.
Besides the label industry, the need for ink-jet printing also extends to many other areas. In response to the surge in high-speed ink-jet printers around the world, specialty paper manufacturers have developed the new series of paper with different surface treatments or fully coating that are combined with digital printing platforms.
Application in Medical Industry
In addition to the growing demand of release paper for the application in bandages and other products, the demand for sterilizable packaging (including paper) in the medical industry will continue to increase. The growth rate of this type of specialty paper in this segment is expected to be about 4.5% between 2019 and 2024.
A determinant attribute of medical wrappers is to protect the surgical instruments or other contents by maintaining the sterile environment. It requires improved tear resistance or puncture resistance can maintains after several sterilizations and provide the necessary shelf life that up to five years in general.