As the pandemic seems to be easing, Europe’s label converters have been saying quietly to themselves “Well, that wasn’t too bad.”

But now another threat looms, and this time it’s indisputably man-made. The strike at UPM’s Finnish mills, even if settled soon (which at present looks unlikely), will have long-term consequences for the label business. 

Although the use of synthetic face materials is growing, paper-based facestock is still the bread-and-butter of the label sector, and all pressure sensitive labels need release liners. Six UPM mills are strikebound, including Tampere (label papers) and Tervasaari (papers for release liners). Two pulp mills are also idle, and just recently the Finnish transport workers’ and electrical workers’ unions have both blacklisted the pulp and paper group.   

A UK printer has already been warned that some deliveries scheduled for March may not arrive until May. European label association FINAT, along with the 15 national associations, has launched a “red warning,” pointing to the widespread disruption to many industrial and commercial sectors if the strike, which started on January 1, continues into mid-March: “We (FINAT) urge all stakeholders (employers, unions and authorities alike) to take the European macro-economic implications of this dispute into consideration, and to assess their social responsibility to the wider European community in resolving this dispute.”

With fuel and other transport prices rocketing, the whole European label supply chain, from pulp to supermarket shelves, will soon be in crisis.

New face papers from Austria
South African heavyweight Sappi is expanding its range of label face papers. Produced at its Gratkorn site in Austria, the new Parade Label SG is a semi-gloss coated label paper approved for direct food contact and for labeling toys, and also intended for a wide range of other applications such as food, beverage, and health and beauty labels, logistics and variable information printing, due to its
thermal printability. 

According to a spokesperson from Sappi’s European HQ in Belgium, it has high rigidity and resilience, so the label will not be damaged and will fit accurately even after labeling. This new supply is alas only a drop in the ocean against the broader picture of medium-term penury of label papers in Europe.

A move to filmic labels?
So far there seems to be no massive switch to filmic labels, but reports from Labelit, one of Italy’s leading wine label converters, could be a straw in the wind. At its plant near Venice, this company runs presses from Gallus, Omet and Nilpeter, and has sales of around $15 million.

Letizia Gambon, sales manager, explains, “Output is currently split 70/30 in favor of paper substrates. But while the paper side is holding steady, we are seeing growth in demand for film labels, both at home and in export markets. This has also led us to invest in corona treatment equipment from Denmark’s Vetaphone.”
To learn more about corona treatment, turn to page 55.

Can hiring get lower?
Generous unemployment benefits and Covid-related stay-at-home incentives pushed millions of Europeans out of the job market. This mainly concerned hard hit sectors like travel and restaurant businesses, but it has had a knock-on effect on employment in the label sector. Extreme examples are France, Greece and Spain, where hiring is tight across the whole economy, despite an unemployment rate now “down” to 7.4% (for France) and an eye-watering 12% for the other two countries.

Italian unemployment is also high, but recruiting the right employees still is a major concern for companies in the label business.

Antonio Bartesaghi, Omet’s CEO, opines, “We have always collaborated with technical schools in our area to make our company known and provide work experience during schooling. We work to keep staff linked to the company through continuous training and through the use of various welfare services that allow a type of work on a human scale.” 

As so often Germany is the outrider, with unemployment just a tad over 3%. This is in part due to apprenticeship schemes used by most German companies to recruit and train young talent. Schreiner, one of Europe’s leading label converters, for example, recruits apprentices massively, helped by government incentives.

The right reflex
One of Britain’s biggest label converters is set to become even bigger. Reflex Group has acquired three label-making subsidiaries from Macfarlane. The acquired companies are in Sweden, Ireland and Scotland, and they will jointly add some $25 million to Reflex’s 2022 sales.

Commenting on this move out of labels, Macfarlane’s CEO Peter Atkinson explains, “The sale will allow the Group to focus resources on growing our protective packaging businesses both in the UK
and Europe.”

For Reflex, which already operates 19 plants in the UK, this acquisition is a major step toward expanding its footprint in Europe.

“Italian unemployment is also high, but recruiting the right employees still is a major concern for companies in the label business.”

Diversification – Heidelberg charges ahead
There has been some interesting diversification around the label business over the past two years, but mostly it is within the packaging or RFID sectors. Not so for Germany’s Heidelberg, which has ventured out into charging devices for electric cars. There seems to be zero synergy between this and Heidelberg’s main printing press activity. 

Intrigued, your correspondent interviewed Heidelberg’s Matthias Hartung to get the inside story.

“Around 10 years ago,” Hartung recalls, “Our company recognized that there were many parallels between the requirements for charging technologies for electric vehicles and electronic control systems for printing presses, and thus saw an opportunity to enter the future market of electromobility.

“In 2012, the company received its first orders from the automotive industry for the development and production of charging cables and wallboxes as an OEM supplier,” Hartung continues. “After producing more than 100,000 charging cables and around 20,000 wallbox systems for electric vehicles on behalf of customers, Heidelberg decided to establish its own business unit for electromobility.  This was followed in 2018 by the sales launch of its own wallbox, the Heidelberg Wallbox Home Eco – the first step for the German market,” Hartung says. (Wallbox Home Eco is pictured on page 28.)

Even the distribution channels are new. While all of Heidelberg’s other business is strictly B2B, the wallbox is available on Amazon! And by the end of January of this year, over 50,000 wallboxes have been sold and installed.

Is this what they mean by thinking outside the box?


Omet’s view
To get a first-hand view on the future of Europe’s label industry, L&NW’s John Penhallow recently interviewed Marco Calcagni (pictured at right), sales and marketing director of leading label press manufacturer Omet.

L&NW: 2021 started well for the European label industry, but increasing supply chain problems and delays seem to be restricting  growth. How do you view European prospects for 2022 –  a) for Europe’s label converters and b) for equipment manufacturers like Omet?

MC: Today all European manufacturers are facing the important problem of the supply chain. Otherwise, European converters are starting to have problems with sourcing raw materials: the increase in the costs of plastic and energy are certainly a brake on their future investments. Despite this, the demand for machinery on the market continues to be always important.

L&NW: Digitization and connectivity seem to be the watchwords for tomorrow’s label and package printing presses. Are there other important criteria?

MC: Sustainability is certainly an essential point for the development of the printing market. For converters, this translates into waste reduction and the use of environmentally compatible materials; and for manufacturers in developing solutions that involve lower energy consumption.