Wet Glue Labels Market: Will it regain its market share to the top in next decade?
An identity is what defines a person. The same applies to a product or package or any other materials being marketed or sold in the local or international market. A label is used not only for identification but also for descriptive information about the product, decoration, pricing, other necessary specifications as per law, etc., for the consumers or the viewers. Increasing population, urbanization trends, globalization, and e-commerce business growth have supported the labels’ demand to grow in the last few years. In today’s world of marketing and advertisement, the company is using quality & high finished labels to promote their brand and products, as the label itself attracts customers. Covid-19 has an impact over label market where some industry has an upward trend like food & beverage, pharmaceuticals, etc. However, industries like automotive, consumer durables, etc., have a downward demand for labels. Since July 2020, the overall demand for labels has seen an upward trend, and the pandemic effect was seen as normal for businesses. Overall the label market for the year 2020 has seen very less effect by pandemic than many other industries.
For a decade, there has been a significant change in the usage of label technology. The label technology, primarily used in the current market, includes PS (pressure sensitive) or self-adhesives, wet glue, sleeve, in-mold, etc. There has been a direct shift of wet glue labels (about 48% of the global labels market by volume in 2010 to 29% by volume in 2020) to PS labels (about 33.6% of the global labels market by volume in 2010 to more than 52% by volume in 2020) due to ease of application, variety of face stock and adhesives used, flexibility, security, advanced VIP ability, etc. As the years have passed in the label industry, there have always been changes in adopting new technologies from the wet glue label to PS label or to shrink/sleeve labels. In the current market, the growth rate for in-mold labels is the highest, i.e., 5.4% (y-o-y 2019) among all, and accounts for only about 2.2% of the total global labels market.
Wet-glue labels are one of the oldest technologies used for labeling as it only applies glues when it is used. It is very economical if used in high order volumes and also provides a variety of finishes. As there is more focus on sustainability and environmental concerns, wet glue labels can be used through recirculation and recycling, and they can use renewable raw materials. A declining trend in disposable containers and increasing usage of reusable beverage containers have gained momentum in the last few years, supporting the environmental benefits and the demand for wet glue labels.
According to AKI Research & Consulting, the global wet glue label market is estimated to have a CAGR of 3.57% during the forecast period 2020-2025 and will reach to 19,885.76 million square meters by volume in 2025.
By region, Asia-Pacific is estimated to have the largest wet glue label market share of 32.58% by volume in 2020, followed by Europe, North America, South America, and Middle-east & Africa. Asia-Pacific is estimated to have the highest CAGR of 4.33% during the forecast period 2020-2025, followed by Middle-East & Africa, Europe, North America, and South America. In the region, Asia-pacific, the PS label has a higher growth rate and demand in end-use applications like food, logistics, pharmaceuticals, etc., than a wet glue label which is restraining the market. In the last two years, the demand for the wet glue label has increased with increasing demand for wet glue labeling machines and sustainability reasons. Even the demand for the linerless label was increased to support the environment, as it reduces the usage of non-recyclable release liners and thus reduced costs too.
North America and Europe have a moderate growth rate of the wet glue labels market as they are matured markets. In 2020, both the regions suffered economically and human losses a lot due to the pandemic. However, the wet glue labels market showed resilience against the covid-19 and did not affect much business. One of the key challenges in the region was the supply of raw materials and delivery disruptions. Many companies and label converters started stockpiling facestock and other materials during the pandemic to avoid supply-demand issues.
By end-user industry, Food & Beverage industry is estimated to account for the largest market share of 55.92% by volume in 2020, followed by Home-care & Household durables, Health & Personal Care, Pharmaceuticals, etc. The food & beverage industry is also estimated to have the highest CAGR of 3.87% by volume during the forecast period 2020-2025. The companies producing wet glue labels or other labels were directly affected because of the pandemic as the impact on the industries they are serving. The companies who were serving multiple end-user industries for the wet glue labels market were like arbitrage in this pandemic. By facestock or material type, paper is estimated to account for the largest share followed by plastic and metalized films & others. The highest growth rate was seen in plastic followed by metalized films & other, and paper. Wet glue labels are used over bottling, box covering, glass containers, interleaving, and food wrapping.
The global wet glue labels market is highly competitive but fragmented, where local & international players play significant roles by region. The key players in wet glue labels or cut & stack labels market include CCL Industries Corp., the GT4 Group, Royal Sens, Caribbean Label Crafts Ltd., Norman A Peroni Ltd., Heidelberg, AA labels, ACTEGA, Multi-Color Corporation, Darley Limited, Fort Dearborn, Huhtamaki Group, West Rock, Töpfer Kulmbach GmbH, Inland Packaging, Doran & Ward Packaging, Jindal Films, etc. among others. In such a competitive market, the label manufacturers try to innovate, upgrade and update their technologies and processes in order to provide good quality & unique p