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IML: a niche market with room for growth

Compelling data was presented at the annual IMLCON & IMDCON, sponsored by Alexander Watson Associates.

Though in-mold labeling is predicted to grow in the next few years, the technology remains largely a niche market, according to data and presentations at the annual three-day IMLCON & IMDCON, presented by Alexander Watson Associates.

During his keynote address, AWA president and CEO Corey Reardon reported that in-mold labeling currently makes up 2 percent of the global label market. That’s only a small fraction of the labels produced worldwide, especially when compared to pressure-sensitive labels, which accounts for the majority of the global market at 39 percent, or glue-applied labels at 36 percent.

While in-mold label technology still claims only limited market acceptance, that data also shows that in-mold labeling has plenty of room for growth. And the IML market is predicted to do just that as a ‘significant shift from direct print to IML’ is likely to continue, Reardon said.

‘IML showed continued year-on-year growth both globally and regionally,’ Reardon said, reporting 2015 statistics, the most current AWA data available. Global IML packaging volume is forecasted to grow at an estimated 4 to 6 percent through 2020, according to Thio Henkes, managing director for LEK Consulting, a business consulting firm in the packaging market as well as many other segments.

Growth drivers

European food and dairy markets have led the adoption of IML. Dairy foods such as soft spreads, margarines, cheeses, sauces and ice-cream are ‘well-suited for food applications because the label is protected from water, ice and other environmental factors,’ Henkes said. Other factors are making IML attractive to brand owners including a lower packaging weight and a growing demand for in-mold labeling in thin-walled containers. In-mold labeling also can provide greater protections for brand owners.

‘IML is beginning to be adopted in personal and home care products,’ Henkes said. ‘IML can be make it more challenging to counterfeit medical or beauty products.’

Traditionally, economic factors and the high cost of producing these labels have stymied their growth. The only way IML labels were economical was in extremely large production quantities. But recently there’s been a shift in the converting process from traditional sheet converting to roll-to-roll, making the process entirely more economical, explained Chris McGuire, sales and marketing manager at Treofan during his presentation. Cost reductions also have been made in film substrates and molding technology driving further growth,  he said.

IML demand

According to AWA data, the demand for in-mold labels is the greatest in Europe, which accounts for 60 percent of the global IML label demand. Africa and the Middle East currently make up 4 percent of the IML label market, but are poised for the biggest gains at 3.6 percent through 2018, Reardon said. North America accounts for 22 percent of the IML market demand, and Asia demand is 11 percent. Those two regions are predicted to have growth margins through 2018 at 3.4 percent for Asia and 2.6 percent growth for North America. The IML demand in South America is 3 percent, and projected to grow at a rate of 2.2 percent.

In 2015, IML made the largest gains in Asia at 3.6 percent. Globally, IML volume grew at a rate of 2.7 percent. Though in-mold labels make up two percent of the world market, which amounts to more than 18 billion packages decorated with in-mold labels, according to data presented by Henkes. Of that, 12.2 billion packages are created in Western Europe, 2.7 billion in the US and 3.7 billion in the rest of the world.

IMLCON & IMDCON ran from November 16-18 in Rosemont, Illinois. Also presenting at the conference were representatives from Taghleef Industries on neuromarketing, Berhalter on die-cutting and Xeikon on digital printing, Blaige & Company on industry consulting, Meech International on static solutions for IML and Advanced Decorating System on product surfaces. Parveen Werner, formerly of Tyson Foods offered his insights on marketing from the brand owner perspective.

ABOUT THE AUTHOR

Chelsea McDougall is group managing editor for Labels & Labeling.

She comes to the magazine with a background in print media. She has won numerous journalism awards and reporting fellowships. Chelsea’s work has been featured on CNN and Huffington Post Live.

 

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