‘Labels’, a new study from Ohio research firm The Freedonia Group Inc., predicts that as food producers seek to boost sales by enhancing shelf appeal, demand for value-added labels will rise.
“Not only will processors use labels to establish a distinctive brand image, but they may also increasingly utilize higher value ‘active’ labels which can indicate product temperature and freshness,” wrote the authors of the report. “Active labels will increasingly find use in the food packaging industry, driven by heightened requirements for longer shelf life for processed foods and packaged foods.”
In addition to active labels, other types of value-added labels projected to experience rising popularity include multipack sleeve labels.
“Heat-shrink sleeve labels are increasingly valued for their ability to effectively join several containers into a single package,” noted the analysts. “Gains will also be fuelled by the visual appeal of shrink labels.”
The study found that polylactic acid (PLA) is increasingly being used in shrink labels, as manufacturers aim to enhance their reputations through the use of more environmentally responsible packaging. It predicted the corn-based material will continue to grow in popularity as prices become more competitive with traditional polymers.
But despite these pockets of dynamism, the rate of growth in the food label market is slower than the label industry as a whole.
Shipments of labels for food processing applications are forecast to climb just 3.7 per cent annually to $4.5 billion in 2015, while the overall market is tipped to grow by 4.8 per cent annually, hitting $20 billion in 2015.
The report attributes this below-par performance to trends which favour the use of pouches and other forms of flexible packaging, as these packages are frequently direct printed, thus eliminating the need for labels in certain applications.
“Demand will be restrained as label-intensive packaging media such as metal cans and glass jars lose out to other types of packaging. Although the growing use of plastic bottles and jars will support gains due to their intensive use of labels...the rising use of unlabeled (or direct printed) containers will restrict advances.”
Nevertheless, the food processing sector will continue to take the lion’s share of primary packaging demand, accounting for more than half of the market through 2015.