South of the US border lies the vast, diverse region known as Latin America. Much like regions on the other side of the globe in Asia, Latin America has long been considered an emerging market, and is a prime example of economic and industrial globalization. And a look at the Latin American label market reveals some distinct trends, showing that the region is indeed emerging, and despite the hiccup that is the global recession, is picking up steam. However, there are challenges.
Going flexo and added value
The consensus among global label industry suppliers is that flexo has become the preferred method of printing in Latin America. Its cost effective characteristics appear to be the main driver, but today's flexo technology has the capability to provide added value--and differentiation in this market is also a key to a converter's success.
John Cavey, manager, Latin America Sales for Mark Andy Inc., says there's been a distinct move from sheetfed offset to flexo, and the reasons for this include increasing volumes, the need for process optimization and additional processes, and competition. He notes that while striving for lower costs is driving the region's flexo boom, it also fuels competition. "In Latin America, there's a competitive nature that is fierce among printing houses with everyone trying to cut costs and operate more efficiently; hence, customers are moving to flexo due to it being less labor intensive and less expensive to produce the final product," he says.
Rubens Wilmers, managing director for Nilpeter Brazil, says that while flexo is dominant, the type of flexo process used varies depending on the application. "When we talk about flexo presses, we have to consider that there are two different markets in Latin America. One is for prime labels, which sometimes demands process combinations such as add-on screen and/or hot stamping. When this is the case, the majority of the labels are produced by inline flexo presses. The other market is the labels that don't have pictures or even so many colors, like logistic labels. These are normally produced by narrow web central drum flexo presses. But we're seeing a change here as more label converters are looking for increased productivity while reducing their operational costs. So converters are looking at inline flexo presses even for these low added value labels," Wilmers says.
Nilpeter began manufacturing presses in Brazil in 2007 in partnership with a Brazilian company. Manufacturing has since stopped, but Nilpeter plans to start again in the near future without a partner.
While flexo is increasing in popularity, suppliers report that combination printing--flexo with other processes--is also gaining ground. "The predominant printing process is clearly flexo. But we are starting to see more and more combination with screen and offset," says Frank Hasselberg, executive VP for Kocher + Beck USA.
Mike Jelinsky, sales engineer for Martin Automatic, says Latin American converters' desire for high quality is driving the move to flexo. "There is a trend throughout Mexico, Central and South America towards flexo and offset printing. The technology of these processes allows high quality, quick job changeover and flexibility. The label manufacturers throughout the region are focused on higher quality, multi-process label construction, developing new domestic markets and exporting to other countries. A major issue is how to offer a higher quality label, shipped within 24 to 48 hours at a low price level. The products on the shelves of the supermarkets, 'big box' retailers and convenience stores have high quality decorative labels that one would see in the US or Europe," Jelinsky says.
Fueling the need for premium labels is the growing volume of export outside of Latin America. Jelinsky says that the US is an important export market for all...