AWA Alexander Watson Associates examines one of the label industry’s most intriguing regions, one with a diverse geographical region, offering real growth opportunities for technical know-how and business expertise of every kind
UAE’s label market – currently representing around 50 million square meters annually
The Middle East and Africa is a combination of both technologically-advanced and underdeveloped countries. There are an estimated 60 languages spoken here – and its lack of homogeneity presents both challenges as well as opportunities.
At the heart of the established label market in the region is the United Arab Emirates (UAE), whose growing international market profile initially attracted the interest of strong Indian label converters with ambitions to go global. Today, most of the UAE label industry is owned or controlled by parent companies in India.
The UAE’s label market – currently representing around 50 million square meters annually – continues to be a focus for expansion. More and more printers are entering the market and offering regional services – often across the range of labelling technologies. This is creating intense competition. A high proportion of the UAE’s products and their labels are exported to other countries, both within the region as well as abroad.
Glue-applied labels
The overall MEA regional label market grew at an estimated 3.9% in 2018. Glue-applied labelling is the main labelling technology, with a 53% market share, and the sector is still growing at a healthy 4% per annum.
Pressure sensitive labels
In the Middle East, as in other parts of the world, pressure sensitive labelling continues to be one of the fastest-growing and predominantly- used labelling formats, with an estimated 40% share of the total label printing market in 2018. Pressure sensitive labels grew at a relatively high rate across the region at 4.1% in 2018. It should be noted that the MEA is, however, still the world’s smallest regional pressure sensitive label market, representing 803 million square meters of volume, which is just 3% of worldwide pressure sensitive label consumption.
In-mold labels
In-mold labels are a format of significant interest in countries around the region, with volumes growing in 2018 by 4.5% to 51 million square meters. Labels for blow molding are the leading application technology, claiming an estimated 71% of Africa and Middle East demand.
In other countries like Egypt, local converting capabilities are limited. Those markets are therefore based on imports from other countries such as Turkey, for example.
In Saudi Arabia and the Gulf States, the established use of
IML-EB technologies in the key packaging sectors for locally-sourced oil-based products, industrial and household chemicals is now also expanding into food packaging.
Sleeve labels
Sleeve labelling is another technology of interest in the region, growing overall in 2018 by around 3%. PVC (with a 77% share) represents the leading choice of substrate across MEA – primarily through the dominance of the heat-shrink TD sleeve label format, coupled with the relatively-low cost of imported film grades, and the ease of PVC’s conversion and application. The manufacture of quality polymer films is becoming increasingly strong in the Middle East, as companies seek to move into downstream, value-added products based on the extensive availability of crude oil and natural gas.
Looking forward
With a forecast growth rate to the end of 2020 of 3.9%, the overall label market in the Middle East and Africa is very much focused on the Middle East, and primarily on the Gulf States and Saudi Arabia.
Ongoing geopolitical and economic issues across much of the region – are still detracting from the realization of higher penetration rates for packaged and labelled products, but IMF projections still suggest that 3% economic growth regionally can be expected in 2020. Source: AWA