{"id":2318,"date":"2018-01-09T15:24:56","date_gmt":"2018-01-09T15:24:56","guid":{"rendered":"https:\/\/www.smithcorona.com\/blog\/?p=2318"},"modified":"2023-12-12T19:04:52","modified_gmt":"2023-12-12T19:04:52","slug":"china-plant-closures-affect-label-receipt-industry","status":"publish","type":"post","link":"https:\/\/www.smithcorona.com\/blog\/china-plant-closures-affect-label-receipt-industry\/","title":{"rendered":"How China Plant Closures Are Affecting The Label &#038; Receipt Industry"},"content":{"rendered":"<p><div class=\"fusion-fullwidth fullwidth-box fusion-builder-row-1 fusion-flex-container nonhundred-percent-fullwidth non-hundred-percent-height-scrolling\" style=\"background-color: rgba(255,255,255,0);background-position: center center;background-repeat: no-repeat;border-width: 0px 0px 0px 0px;border-color:#eae9e9;border-style:solid;\" ><div class=\"fusion-builder-row fusion-row fusion-flex-align-items-flex-start\" style=\"max-width:1144px;margin-left: calc(-4% \/ 2 );margin-right: calc(-4% \/ 2 );\"><div class=\"fusion-layout-column fusion_builder_column fusion-builder-column-0 fusion_builder_column_1_1 1_1 fusion-flex-column\"><div class=\"fusion-column-wrapper fusion-flex-justify-content-flex-start fusion-content-layout-column\" style=\"background-position:left top;background-repeat:no-repeat;-webkit-background-size:cover;-moz-background-size:cover;-o-background-size:cover;background-size:cover;padding: 0px 0px 0px 0px;\"><div class=\"fusion-text fusion-text-1\"><p><span style=\"font-weight: 400;\">Well, it might be closer to reality than you might expect. \u00a0The key chemical component utilized in the receipt paper is about to become low in supply and high on demand.\u00a0\u00a0<\/span><\/p>\n<\/div>\n            <div class=\"smith-corona-featured-image\">\n\n                <img src=\"https:\/\/www.smithcorona.com\/blog\/wp-content\/uploads\/2022\/09\/how-china-plant-closures-are-affecting-the-label-receipt-industry-hero-splash.png\" alt=\"\" width=\"760\" height=\"460\" \/>\n\n            <\/div>\n        <div class=\"fusion-text fusion-text-2\"><p><span style=\"font-weight: 400;\">This shortage is expected to dramatically raise prices on the paper that is used to give us our receipts at gas stations, restaurants, retail shops, and more. \u00a0With an impending rise in <a href=\"https:\/\/www.smithcorona.com\/direct-thermal-labels.html\">direct thermal<\/a> paper prices on the horizon, many companies might look to go paperless. \u00a0<\/span><\/p>\n<\/div><\/div><style type=\"text\/css\">.fusion-body .fusion-builder-column-0{width:100% !important;margin-top : 0px;margin-bottom : 20px;}.fusion-builder-column-0 > .fusion-column-wrapper {padding-top : 0px !important;padding-right : 0px !important;margin-right : 1.92%;padding-bottom : 0px !important;padding-left : 0px !important;margin-left : 1.92%;}@media only screen and (max-width:1064px) {.fusion-body .fusion-builder-column-0{width:100% !important;}.fusion-builder-column-0 > .fusion-column-wrapper {margin-right : 1.92%;margin-left : 1.92%;}}@media only screen and (max-width:640px) {.fusion-body .fusion-builder-column-0{width:100% !important;}.fusion-builder-column-0 > .fusion-column-wrapper {margin-right : 1.92%;margin-left : 1.92%;}}<\/style><\/div><\/div><style type=\"text\/css\">.fusion-body .fusion-flex-container.fusion-builder-row-1{ padding-top : 20px;margin-top : 0px;padding-right : 0px;padding-bottom : 20px;margin-bottom : 0px;padding-left : 0px;}<\/style><\/div><div class=\"fusion-fullwidth fullwidth-box fusion-builder-row-2 fusion-flex-container nonhundred-percent-fullwidth non-hundred-percent-height-scrolling\" style=\"background-color: rgba(255,255,255,0);background-position: center center;background-repeat: no-repeat;border-width: 0px 0px 0px 0px;border-color:#eae9e9;border-style:solid;\" ><div class=\"fusion-builder-row fusion-row fusion-flex-align-items-flex-start\" style=\"max-width:1144px;margin-left: calc(-4% \/ 2 );margin-right: calc(-4% \/ 2 );\"><div class=\"fusion-layout-column fusion_builder_column fusion-builder-column-1 fusion_builder_column_1_1 1_1 fusion-flex-column\"><div class=\"fusion-column-wrapper fusion-flex-justify-content-flex-start fusion-content-layout-column\" style=\"background-position:left top;background-repeat:no-repeat;-webkit-background-size:cover;-moz-background-size:cover;-o-background-size:cover;background-size:cover;padding: 0px 0px 0px 0px;\"><style type=\"text\/css\">@media only screen and (max-width:1064px) {.fusion-title.fusion-title-1{margin-top:5px!important; margin-right:0px!important;margin-bottom:10px!important;margin-left:0px!important;}}@media only screen and (max-width:640px) {.fusion-title.fusion-title-1{margin-top:0px!important; margin-right:0px!important;margin-bottom:20px!important; margin-left:0px!important;}}<\/style><div class=\"fusion-title title fusion-title-1 fusion-sep-none fusion-title-text fusion-title-size-two\" style=\"margin-top:5px;margin-right:0px;margin-bottom:10px;margin-left:0px;\"><h2 class=\"title-heading-left\" style=\"margin:0;\"><strong>So what happened and how did we get here? <\/strong><\/h2><\/div><div class=\"fusion-text fusion-text-3\"><p><span style=\"font-weight: 400;\">In early September,\u00a0 tens of thousands of Chinese manufacturers were shut down by the Chinese Government due to a renewed enforcement of environmental regulations.\u00a0 Chinese officials had grown tired of all the pollution caused by low value manufacturers and decided to take a more proactive approach.\u00a0\u00a0It is estimated that over 80,000 factories have been either shut down, fined, or hit with criminal offenses as a result of their emissions.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">The closure of one Chinese company, Connect Chemical, is what has thrown the thermal paper industry in a tailspin.\u00a0 It just so happened that Connect Chemical, was the company responsible for about 50% of entire the world\u2019s production of a chemical dye by the name of <\/span><b>leuco<\/b><span style=\"font-weight: 400;\">. \u00a0Additionally, several other Chinese manufacturers of leuco dye were shut down at the same time. \u00a0In combination, it is estimated that almost 80% of the world\u2019s supply of leuco dye has been halted.<sup>1<\/sup><\/span><span style=\"font-weight: 400;\"><br \/>\n<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Leuco is the key component in direct thermal paper, which is the paper that is printed on and used for receipts, shipping labels, airlines tickets, and much more. Shutting down Connect Chemical has begun to put a gigantic squeeze on the thermal paper supply chain world wide and could have a huge impact on several different industries moving forward. \u00a0After the announcement that Connect Chemical had been shut down, the prices for leuco skyrocketed to <\/span><b><i>5 times<\/i><\/b><span style=\"font-weight: 400;\"> their normal price. \u00a0At this time, it is anticipated that Connect Chemical will reopen in the summer of 2018.<sup>1<\/sup> However, nothing concrete has been determined. <\/span><\/p>\n<\/div><\/div><style type=\"text\/css\">.fusion-body .fusion-builder-column-1{width:100% !important;margin-top : 0px;margin-bottom : 20px;}.fusion-builder-column-1 > .fusion-column-wrapper {padding-top : 0px !important;padding-right : 0px !important;margin-right : 1.92%;padding-bottom : 0px !important;padding-left : 0px !important;margin-left : 1.92%;}@media only screen and (max-width:1064px) {.fusion-body .fusion-builder-column-1{width:100% !important;}.fusion-builder-column-1 > .fusion-column-wrapper {margin-right : 1.92%;margin-left : 1.92%;}}@media only screen and (max-width:640px) {.fusion-body .fusion-builder-column-1{width:100% !important;}.fusion-builder-column-1 > .fusion-column-wrapper {margin-right : 1.92%;margin-left : 1.92%;}}<\/style><\/div><\/div><style type=\"text\/css\">.fusion-body .fusion-flex-container.fusion-builder-row-2{ padding-top : 0px;margin-top : 0px;padding-right : 0px;padding-bottom : 0px;margin-bottom : 0px;padding-left : 0px;}<\/style><\/div><div class=\"fusion-fullwidth fullwidth-box fusion-builder-row-3 fusion-flex-container nonhundred-percent-fullwidth non-hundred-percent-height-scrolling\" style=\"background-color: rgba(255,255,255,0);background-position: center center;background-repeat: no-repeat;border-width: 0px 0px 0px 0px;border-color:#eae9e9;border-style:solid;\" ><div class=\"fusion-builder-row fusion-row fusion-flex-align-items-flex-start\" style=\"max-width:1144px;margin-left: calc(-4% \/ 2 );margin-right: calc(-4% \/ 2 );\"><div class=\"fusion-layout-column fusion_builder_column fusion-builder-column-2 fusion_builder_column_1_1 1_1 fusion-flex-column\"><div class=\"fusion-column-wrapper fusion-flex-justify-content-flex-start fusion-content-layout-column\" style=\"background-position:left top;background-repeat:no-repeat;-webkit-background-size:cover;-moz-background-size:cover;-o-background-size:cover;background-size:cover;padding: 0px 0px 0px 0px;\"><style type=\"text\/css\">@media only screen and (max-width:1064px) {.fusion-title.fusion-title-2{margin-top:5px!important; margin-right:0px!important;margin-bottom:10px!important;margin-left:0px!important;}}@media only screen and (max-width:640px) {.fusion-title.fusion-title-2{margin-top:0px!important; margin-right:0px!important;margin-bottom:20px!important; margin-left:0px!important;}}<\/style><div class=\"fusion-title title fusion-title-2 fusion-sep-none fusion-title-text fusion-title-size-two\" style=\"margin-top:5px;margin-right:0px;margin-bottom:10px;margin-left:0px;\"><h2 class=\"title-heading-left\" style=\"margin:0;\"><strong>Initial Impact<\/strong><\/h2><\/div><div class=\"fusion-text fusion-text-4\"><p><span style=\"font-weight: 400;\">The industry that will initially be most heavily impacted by the shortage of leuco dye is the already turbulent receipt paper industry.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">In recent years, the receipt paper business has become a cutthroat race to the bottom. \u00a0In fact, reduced margins and a general reduction in market demand for receipt paper has lead several high profile mergers. \u00a0On November 2nd, 2017, Iconex, a receipt paper giant, acquired two other top 5 receipt paper companies: RiteMade Paper Converters and PM Company. \u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Overall, the combination of an already deteriorating industry and a low supply of receipt paper could usher in a whole new wave of retailers deciding to go paperless with their receipts. \u00a0<\/span><\/p>\n<\/div><\/div><style type=\"text\/css\">.fusion-body .fusion-builder-column-2{width:100% !important;margin-top : 0px;margin-bottom : 20px;}.fusion-builder-column-2 > .fusion-column-wrapper {padding-top : 0px !important;padding-right : 0px !important;margin-right : 1.92%;padding-bottom : 0px !important;padding-left : 0px !important;margin-left : 1.92%;}@media only screen and (max-width:1064px) {.fusion-body .fusion-builder-column-2{width:100% !important;}.fusion-builder-column-2 > .fusion-column-wrapper {margin-right : 1.92%;margin-left : 1.92%;}}@media only screen and (max-width:640px) {.fusion-body .fusion-builder-column-2{width:100% !important;}.fusion-builder-column-2 > .fusion-column-wrapper {margin-right : 1.92%;margin-left : 1.92%;}}<\/style><\/div><\/div><style type=\"text\/css\">.fusion-body .fusion-flex-container.fusion-builder-row-3{ padding-top : 0px;margin-top : 0px;padding-right : 0px;padding-bottom : 0px;margin-bottom : 0px;padding-left : 0px;}<\/style><\/div><div class=\"fusion-fullwidth fullwidth-box fusion-builder-row-4 fusion-flex-container nonhundred-percent-fullwidth non-hundred-percent-height-scrolling\" style=\"background-color: rgba(255,255,255,0);background-position: center center;background-repeat: no-repeat;border-width: 0px 0px 0px 0px;border-color:#eae9e9;border-style:solid;\" ><div class=\"fusion-builder-row fusion-row fusion-flex-align-items-flex-start\" style=\"max-width:1144px;margin-left: calc(-4% \/ 2 );margin-right: calc(-4% \/ 2 );\"><div class=\"fusion-layout-column fusion_builder_column fusion-builder-column-3 fusion_builder_column_1_1 1_1 fusion-flex-column\"><div class=\"fusion-column-wrapper fusion-flex-justify-content-flex-start fusion-content-layout-column\" style=\"background-position:left top;background-repeat:no-repeat;-webkit-background-size:cover;-moz-background-size:cover;-o-background-size:cover;background-size:cover;padding: 0px 0px 0px 0px;\"><style type=\"text\/css\">@media only screen and (max-width:1064px) {.fusion-title.fusion-title-3{margin-top:5px!important; margin-right:0px!important;margin-bottom:10px!important;margin-left:0px!important;}}@media only screen and (max-width:640px) {.fusion-title.fusion-title-3{margin-top:0px!important; margin-right:0px!important;margin-bottom:20px!important; margin-left:0px!important;}}<\/style><div class=\"fusion-title title fusion-title-3 fusion-sep-none fusion-title-text fusion-title-size-two\" style=\"margin-top:5px;margin-right:0px;margin-bottom:10px;margin-left:0px;\"><h2 class=\"title-heading-left\" style=\"margin:0;\"><strong>eReceipts &#8211; Money Saver &amp; Marketing Manna<\/strong><\/h2><\/div><div style=\"text-align:center;\"><span class=\" fusion-imageframe imageframe-none imageframe-1 hover-type-none\"><img width=\"1920\" height=\"1202\" title=\"Email Image\" src=\"https:\/\/www.smithcorona.com\/blog\/wp-content\/uploads\/2017\/12\/Email-Image.jpg\" alt class=\"img-responsive wp-image-2331\" srcset=\"https:\/\/www.smithcorona.com\/blog\/wp-content\/uploads\/2017\/12\/Email-Image-200x125.jpg 200w, https:\/\/www.smithcorona.com\/blog\/wp-content\/uploads\/2017\/12\/Email-Image-400x250.jpg 400w, https:\/\/www.smithcorona.com\/blog\/wp-content\/uploads\/2017\/12\/Email-Image-600x376.jpg 600w, https:\/\/www.smithcorona.com\/blog\/wp-content\/uploads\/2017\/12\/Email-Image-800x501.jpg 800w, https:\/\/www.smithcorona.com\/blog\/wp-content\/uploads\/2017\/12\/Email-Image-1200x751.jpg 1200w, https:\/\/www.smithcorona.com\/blog\/wp-content\/uploads\/2017\/12\/Email-Image.jpg 1920w\" sizes=\"(max-width: 1064px) 100vw, (max-width: 640px) 100vw, 1200px\" \/><\/span><\/div><div class=\"fusion-text fusion-text-5\"><p><span style=\"font-weight: 400;\">Saving money &#8212;<\/span><i><span style=\"font-weight: 400;\"> and a lot of it <\/span><\/i><span style=\"font-weight: 400;\">&#8212; isn\u2019t the only reason retailers want to go paperless and convert from paper receipts to e-receipts \u00a0It\u2019s all about the image and emails. \u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Sustainability has become a hot topic with major retailers in the past decade. \u00a0Many customers make their decisions in accordance to a company\u2019s environmental consciousness. The idea of eliminating receipts to help reduce waste is the perfect vehicle for retailers to initiate this change. \u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">However, the biggest win for retailers is getting YOUR email address. \u00a0Now, they have the ability to market new specials and product recommendations to you. \u00a0This isn\u2019t quite the deal with the devil that retailers might expect. \u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Somewhat surprisingly, consumers are actually more than happy to give out their email for electronic receipts. \u00a0Personalized messaging has taken over and with the help of past transaction data, companies are able to cross sell and up-sell consumers things they actually want. \u00a0In fact, a recent study by Boston Retail Partners found that 80 percent of consumers said they liked when \u00a0retailers \u00a0send \u00a0product recommendation via email.<sup>2<\/sup><\/span><\/p>\n<\/div><\/div><style type=\"text\/css\">.fusion-body .fusion-builder-column-3{width:100% !important;margin-top : 0px;margin-bottom : 20px;}.fusion-builder-column-3 > .fusion-column-wrapper {padding-top : 0px !important;padding-right : 0px !important;margin-right : 1.92%;padding-bottom : 0px !important;padding-left : 0px !important;margin-left : 1.92%;}@media only screen and (max-width:1064px) {.fusion-body .fusion-builder-column-3{width:100% !important;}.fusion-builder-column-3 > .fusion-column-wrapper {margin-right : 1.92%;margin-left : 1.92%;}}@media only screen and (max-width:640px) {.fusion-body .fusion-builder-column-3{width:100% !important;}.fusion-builder-column-3 > .fusion-column-wrapper {margin-right : 1.92%;margin-left : 1.92%;}}<\/style><\/div><\/div><style type=\"text\/css\">.fusion-body .fusion-flex-container.fusion-builder-row-4{ padding-top : 0px;margin-top : 0px;padding-right : 0px;padding-bottom : 0px;margin-bottom : 0px;padding-left : 0px;}<\/style><\/div><div class=\"fusion-fullwidth fullwidth-box fusion-builder-row-5 fusion-flex-container nonhundred-percent-fullwidth non-hundred-percent-height-scrolling\" style=\"background-color: rgba(255,255,255,0);background-position: center center;background-repeat: no-repeat;border-width: 0px 0px 0px 0px;border-color:#eae9e9;border-style:solid;\" ><div class=\"fusion-builder-row fusion-row fusion-flex-align-items-flex-start\" style=\"max-width:1144px;margin-left: calc(-4% \/ 2 );margin-right: calc(-4% \/ 2 );\"><div class=\"fusion-layout-column fusion_builder_column fusion-builder-column-4 fusion_builder_column_1_1 1_1 fusion-flex-column\"><div class=\"fusion-column-wrapper fusion-flex-justify-content-flex-start fusion-content-layout-column\" style=\"background-position:left top;background-repeat:no-repeat;-webkit-background-size:cover;-moz-background-size:cover;-o-background-size:cover;background-size:cover;padding: 0px 0px 0px 0px;\"><style type=\"text\/css\">@media only screen and (max-width:1064px) {.fusion-title.fusion-title-4{margin-top:5px!important; margin-right:0px!important;margin-bottom:10px!important;margin-left:0px!important;}}@media only screen and (max-width:640px) {.fusion-title.fusion-title-4{margin-top:0px!important; margin-right:0px!important;margin-bottom:20px!important; margin-left:0px!important;}}<\/style><div class=\"fusion-title title fusion-title-4 fusion-sep-none fusion-title-text fusion-title-size-two\" style=\"margin-top:5px;margin-right:0px;margin-bottom:10px;margin-left:0px;\"><h2 class=\"title-heading-left\" style=\"margin:0;\"><strong>The Perfect Label Storm? &#8211; Shortages, Closures, and More<\/strong><\/h2><\/div><div class=\"fusion-text fusion-text-6\"><p><span style=\"font-weight: 400;\">While receipt paper might be the industry most affected, the <a href=\"https:\/\/www.smithcorona.com\/\">thermal label<\/a> industry is poised for a major shakeup as well. \u00a0On it\u2019s own, the leuco dye shortage would cause a small industry price increase. \u00a0But this isn\u2019t the only factor at play. \u00a0In fact, there are four other major industry shakeups that are accelerating price increases on thermal paper:<\/span><\/p>\n<ol>\n<li style=\"font-weight: 400;\"><a href=\"https:\/\/www.smithcorona.com\/blog\/paper-mills-increase-prices\/\"><span style=\"font-weight: 400;\">The Chapter 11 bankruptcy of Appvion<\/span><\/a><\/li>\n<li style=\"font-weight: 400;\"><a href=\"https:\/\/www.smithcorona.com\/blog\/pca-release-liner-change\/\"><span style=\"font-weight: 400;\">Boise Paper exiting the release liner business<\/span><\/a><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Worldwide increase in demand for tree pulp<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Oil, rubber, and silicone price increases<\/span><\/li>\n<\/ol>\n<\/div><\/div><style type=\"text\/css\">.fusion-body .fusion-builder-column-4{width:100% !important;margin-top : 0px;margin-bottom : 20px;}.fusion-builder-column-4 > .fusion-column-wrapper {padding-top : 0px !important;padding-right : 0px !important;margin-right : 1.92%;padding-bottom : 0px !important;padding-left : 0px !important;margin-left : 1.92%;}@media only screen and (max-width:1064px) {.fusion-body .fusion-builder-column-4{width:100% !important;}.fusion-builder-column-4 > .fusion-column-wrapper {margin-right : 1.92%;margin-left : 1.92%;}}@media only screen and (max-width:640px) {.fusion-body .fusion-builder-column-4{width:100% !important;}.fusion-builder-column-4 > .fusion-column-wrapper {margin-right : 1.92%;margin-left : 1.92%;}}<\/style><\/div><\/div><style type=\"text\/css\">.fusion-body .fusion-flex-container.fusion-builder-row-5{ padding-top : 0px;margin-top : 0px;padding-right : 0px;padding-bottom : 0px;margin-bottom : 0px;padding-left : 0px;}<\/style><\/div><div class=\"fusion-fullwidth fullwidth-box fusion-builder-row-6 fusion-flex-container nonhundred-percent-fullwidth non-hundred-percent-height-scrolling\" style=\"background-color: rgba(255,255,255,0);background-position: center center;background-repeat: no-repeat;border-width: 0px 0px 0px 0px;border-color:#eae9e9;border-style:solid;\" ><div class=\"fusion-builder-row fusion-row fusion-flex-align-items-flex-start\" style=\"max-width:1144px;margin-left: calc(-4% \/ 2 );margin-right: calc(-4% \/ 2 );\"><div class=\"fusion-layout-column fusion_builder_column fusion-builder-column-5 fusion_builder_column_1_1 1_1 fusion-flex-column\"><div class=\"fusion-column-wrapper fusion-flex-justify-content-flex-start fusion-content-layout-column\" style=\"background-position:left top;background-repeat:no-repeat;-webkit-background-size:cover;-moz-background-size:cover;-o-background-size:cover;background-size:cover;padding: 0px 0px 0px 0px;\"><style type=\"text\/css\">@media only screen and (max-width:1064px) {.fusion-title.fusion-title-5{margin-top:5px!important; margin-right:0px!important;margin-bottom:10px!important;margin-left:0px!important;}}@media only screen and (max-width:640px) {.fusion-title.fusion-title-5{margin-top:0px!important; margin-right:0px!important;margin-bottom:20px!important; margin-left:0px!important;}}<\/style><div class=\"fusion-title title fusion-title-5 fusion-sep-none fusion-title-text fusion-title-size-two\" style=\"margin-top:5px;margin-right:0px;margin-bottom:10px;margin-left:0px;\"><h2 class=\"title-heading-left\" style=\"margin:0;\"><strong>To start, we look back at the leuco dye crisis. <\/strong><\/h2><\/div><div class=\"fusion-text fusion-text-7\"><p><span style=\"font-weight: 400;\">The abrupt closure of Connect Chemical\u00a0 and other leuco dye suppliers has left several of the 7\u00a0 direct thermal coaters scrambling to meet thermal paper demand. \u00a0Those that were most heavily impacted were the coaters located closest to Connect Chemical. \u00a0In an attempt to stay lean, these coaters were practicing just in time (JIT) inventory.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Rumors have it that South Korea based conglomerate, Hansol Papers &#8212; one of the world\u2019s top 7 paper coaters &#8212; allegedly had only a 2 week supply of leuco dye when the closure of Connect Chemical was announced.\u00a0 Additionally, the global shortage of leuco dye, and consequently thermal paper, has stopped several international paper coaters from taking on any new US customers. \u00a0\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Other thermal paper producers, such as Mitsubishi have sent letters to their customers describing how dire the situation just might become:<\/span><\/p>\n<\/div><div class=\"fusion-text fusion-text-8\"><blockquote>\n<p>\u201cThe possibility cannot be ruled out that due to this situation there may also be a production shortage or stop as of January 2018\u201d<\/p>\n<\/blockquote>\n<\/div><div class=\"fusion-text fusion-text-9\"><p><span style=\"font-weight: 400;\">These <a href=\"https:\/\/www.smithcorona.com\/blog\/paper-mills-increase-prices\/\">paper price increases<\/a> have already begun to reverberate through the thermal label supply chain.\u00a0\u00a0<\/span><span style=\"font-weight: 400;\">Industry titan, Avery Dennison, has let its suppliers and customers know that a 4-6% price increase is expected to take effect in 2018.\u00a0 \u00a0<\/span><span style=\"font-weight: 400;\">Additionally, several of the largest label laminators in the United States have announced price increases. \u00a0For example, UPM Raflatac, one of the largest laminators in the US, messaged their customers with the following statement:<\/span><\/p>\n<\/div><div class=\"fusion-text fusion-text-10\"><blockquote>\n<p>\u201cThe magnitude of the increase leaves us with no option but to pass on a price increase of 6-8% on all film and paper pressure sensitive laminate products&#8230;\u201d<\/p>\n<\/blockquote>\n<\/div><div class=\"fusion-text fusion-text-11\"><p>Price increases throughout the supply chain will have other converters, wholesalers, dealers, and end users looking at price increase in the very near future.<\/p>\n<\/div><\/div><style type=\"text\/css\">.fusion-body .fusion-builder-column-5{width:100% !important;margin-top : 0px;margin-bottom : 20px;}.fusion-builder-column-5 > .fusion-column-wrapper {padding-top : 0px !important;padding-right : 0px !important;margin-right : 1.92%;padding-bottom : 0px !important;padding-left : 0px !important;margin-left : 1.92%;}@media only screen and (max-width:1064px) {.fusion-body .fusion-builder-column-5{width:100% !important;}.fusion-builder-column-5 > .fusion-column-wrapper {margin-right : 1.92%;margin-left : 1.92%;}}@media only screen and (max-width:640px) {.fusion-body .fusion-builder-column-5{width:100% !important;}.fusion-builder-column-5 > .fusion-column-wrapper {margin-right : 1.92%;margin-left : 1.92%;}}<\/style><\/div><\/div><style type=\"text\/css\">.fusion-body .fusion-flex-container.fusion-builder-row-6{ padding-top : 0px;margin-top : 0px;padding-right : 0px;padding-bottom : 0px;margin-bottom : 0px;padding-left : 0px;}<\/style><\/div><div class=\"fusion-fullwidth fullwidth-box fusion-builder-row-7 fusion-flex-container nonhundred-percent-fullwidth non-hundred-percent-height-scrolling\" style=\"background-color: rgba(255,255,255,0);background-position: center center;background-repeat: no-repeat;border-width: 0px 0px 0px 0px;border-color:#eae9e9;border-style:solid;\" ><div class=\"fusion-builder-row fusion-row fusion-flex-align-items-flex-start\" style=\"max-width:1144px;margin-left: calc(-4% \/ 2 );margin-right: calc(-4% \/ 2 );\"><div class=\"fusion-layout-column fusion_builder_column fusion-builder-column-6 fusion_builder_column_1_1 1_1 fusion-flex-column\"><div class=\"fusion-column-wrapper fusion-flex-justify-content-flex-start fusion-content-layout-column\" style=\"background-position:left top;background-repeat:no-repeat;-webkit-background-size:cover;-moz-background-size:cover;-o-background-size:cover;background-size:cover;padding: 0px 0px 0px 0px;\"><style type=\"text\/css\">@media only screen and (max-width:1064px) {.fusion-title.fusion-title-6{margin-top:5px!important; margin-right:0px!important;margin-bottom:10px!important;margin-left:0px!important;}}@media only screen and (max-width:640px) {.fusion-title.fusion-title-6{margin-top:0px!important; margin-right:0px!important;margin-bottom:20px!important; margin-left:0px!important;}}<\/style><div class=\"fusion-title title fusion-title-6 fusion-sep-none fusion-title-text fusion-title-size-two\" style=\"margin-top:5px;margin-right:0px;margin-bottom:10px;margin-left:0px;\"><h2 class=\"title-heading-left\" style=\"margin:0;\"><strong>Don\u2019t Look For US Suppliers to Step In<\/strong><\/h2><\/div><div class=\"fusion-text fusion-text-12\"><p><span style=\"font-weight: 400;\">At this critical time, you might expect a <a href=\"https:\/\/www.smithcorona.com\/blog\/how-china-is-killing-another-american-industry\/\">US based manufacturer<\/a> to come in and pick up the slack that international paper coaters couldn\u2019t. \u00a0However, the timing couldn\u2019t be worse.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">US-based thermal paper manufacturer, Appvion (formerly Appleton Papers), filed for Chapter 11 Bankruptcy on \u00a0October 2nd, 2017. This was another huge blow to the thermal label business as Appvion is the third largest paper coater in the world and produces between 40-50% of all coated paper in the United States.<sup>3<\/sup> \u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">While Appvion attempts to sort out its financial woes, they too have begun to increase prices. \u00a0Since July 1st of 2017, they have increased prices by 29% for their 2.1 and 2.3 mil thick paper stock. \u00a0It is estimated that 24% of this price increase is related to the leuco dye shortage.<sup>4<\/sup>\u00a0 (Source:http:\/\/www.telemarkcorp.com\/paper-shortage-update-price-increases\/)<\/span><\/p>\n<\/div><\/div><style type=\"text\/css\">.fusion-body .fusion-builder-column-6{width:100% !important;margin-top : 0px;margin-bottom : 20px;}.fusion-builder-column-6 > .fusion-column-wrapper {padding-top : 0px !important;padding-right : 0px !important;margin-right : 1.92%;padding-bottom : 0px !important;padding-left : 0px !important;margin-left : 1.92%;}@media only screen and (max-width:1064px) {.fusion-body .fusion-builder-column-6{width:100% !important;}.fusion-builder-column-6 > .fusion-column-wrapper {margin-right : 1.92%;margin-left : 1.92%;}}@media only screen and (max-width:640px) {.fusion-body .fusion-builder-column-6{width:100% !important;}.fusion-builder-column-6 > .fusion-column-wrapper {margin-right : 1.92%;margin-left : 1.92%;}}<\/style><\/div><\/div><style type=\"text\/css\">.fusion-body .fusion-flex-container.fusion-builder-row-7{ padding-top : 0px;margin-top : 0px;padding-right : 0px;padding-bottom : 0px;margin-bottom : 0px;padding-left : 0px;}<\/style><\/div><div class=\"fusion-fullwidth fullwidth-box fusion-builder-row-8 fusion-flex-container nonhundred-percent-fullwidth non-hundred-percent-height-scrolling\" style=\"background-color: rgba(255,255,255,0);background-position: center center;background-repeat: no-repeat;border-width: 0px 0px 0px 0px;border-color:#eae9e9;border-style:solid;\" ><div class=\"fusion-builder-row fusion-row fusion-flex-align-items-flex-start\" style=\"max-width:1144px;margin-left: calc(-4% \/ 2 );margin-right: calc(-4% \/ 2 );\"><div class=\"fusion-layout-column fusion_builder_column fusion-builder-column-7 fusion_builder_column_1_1 1_1 fusion-flex-column\"><div class=\"fusion-column-wrapper fusion-flex-justify-content-flex-start fusion-content-layout-column\" style=\"background-position:left top;background-repeat:no-repeat;-webkit-background-size:cover;-moz-background-size:cover;-o-background-size:cover;background-size:cover;padding: 0px 0px 0px 0px;\"><style type=\"text\/css\">@media only screen and (max-width:1064px) {.fusion-title.fusion-title-7{margin-top:5px!important; margin-right:0px!important;margin-bottom:10px!important;margin-left:0px!important;}}@media only screen and (max-width:640px) {.fusion-title.fusion-title-7{margin-top:0px!important; margin-right:0px!important;margin-bottom:20px!important; margin-left:0px!important;}}<\/style><div class=\"fusion-title title fusion-title-7 fusion-sep-none fusion-title-text fusion-title-size-two\" style=\"margin-top:5px;margin-right:0px;margin-bottom:10px;margin-left:0px;\"><h2 class=\"title-heading-left\" style=\"margin:0;\"><strong>Release Liner Hikes Are Next<\/strong><\/h2><\/div><div ><span class=\" fusion-imageframe imageframe-none imageframe-2 hover-type-none\"><img width=\"800\" height=\"533\" alt=\"Release liners will soon be affected by the plant closures\" title=\"Release Liner Image\" src=\"https:\/\/www.smithcorona.com\/blog\/wp-content\/uploads\/2017\/12\/Release-Liner-2-800x533.jpg\" class=\"img-responsive wp-image-2355\" srcset=\"https:\/\/www.smithcorona.com\/blog\/wp-content\/uploads\/2017\/12\/Release-Liner-2-200x133.jpg 200w, https:\/\/www.smithcorona.com\/blog\/wp-content\/uploads\/2017\/12\/Release-Liner-2-400x267.jpg 400w, https:\/\/www.smithcorona.com\/blog\/wp-content\/uploads\/2017\/12\/Release-Liner-2-600x400.jpg 600w, https:\/\/www.smithcorona.com\/blog\/wp-content\/uploads\/2017\/12\/Release-Liner-2-800x533.jpg 800w, https:\/\/www.smithcorona.com\/blog\/wp-content\/uploads\/2017\/12\/Release-Liner-2-1200x800.jpg 1200w, https:\/\/www.smithcorona.com\/blog\/wp-content\/uploads\/2017\/12\/Release-Liner-2.jpg 1356w\" sizes=\"(max-width: 1064px) 100vw, (max-width: 640px) 100vw, 1200px\" \/><\/span><\/div><div class=\"fusion-text fusion-text-13\"><p><span style=\"font-weight: 400;\">To compound the increased prices problem, Boise Paper, a US Based manufacturer of label release liner announced that they will be leaving the release liner business to pursue more lucrative products. <\/span><\/p>\n<p><span style=\"font-weight: 400;\">According to a letter from Diversified Labeling Solutions to their customers, it is estimated that Boise was responsible for 30% of the liner used in North America.\u00a0 Their exit will have a significant impact on both the availability and the price of label release liners in the United States. \u00a0<\/span><\/p>\n<\/div><\/div><style type=\"text\/css\">.fusion-body .fusion-builder-column-7{width:100% !important;margin-top : 0px;margin-bottom : 20px;}.fusion-builder-column-7 > .fusion-column-wrapper {padding-top : 0px !important;padding-right : 0px !important;margin-right : 1.92%;padding-bottom : 0px !important;padding-left : 0px !important;margin-left : 1.92%;}@media only screen and (max-width:1064px) {.fusion-body .fusion-builder-column-7{width:100% !important;}.fusion-builder-column-7 > .fusion-column-wrapper {margin-right : 1.92%;margin-left : 1.92%;}}@media only screen and (max-width:640px) {.fusion-body .fusion-builder-column-7{width:100% !important;}.fusion-builder-column-7 > .fusion-column-wrapper {margin-right : 1.92%;margin-left : 1.92%;}}<\/style><\/div><\/div><style type=\"text\/css\">.fusion-body .fusion-flex-container.fusion-builder-row-8{ padding-top : 0px;margin-top : 0px;padding-right : 0px;padding-bottom : 0px;margin-bottom : 0px;padding-left : 0px;}<\/style><\/div><div class=\"fusion-fullwidth fullwidth-box fusion-builder-row-9 fusion-flex-container nonhundred-percent-fullwidth non-hundred-percent-height-scrolling\" style=\"background-color: rgba(255,255,255,0);background-position: center center;background-repeat: no-repeat;border-width: 0px 0px 0px 0px;border-color:#eae9e9;border-style:solid;\" ><div class=\"fusion-builder-row fusion-row fusion-flex-align-items-flex-start\" style=\"max-width:1144px;margin-left: calc(-4% \/ 2 );margin-right: calc(-4% \/ 2 );\"><div class=\"fusion-layout-column fusion_builder_column fusion-builder-column-8 fusion_builder_column_1_1 1_1 fusion-flex-column\"><div class=\"fusion-column-wrapper fusion-flex-justify-content-flex-start fusion-content-layout-column\" style=\"background-position:left top;background-repeat:no-repeat;-webkit-background-size:cover;-moz-background-size:cover;-o-background-size:cover;background-size:cover;padding: 0px 0px 0px 0px;\"><style type=\"text\/css\">@media only screen and (max-width:1064px) {.fusion-title.fusion-title-8{margin-top:5px!important; margin-right:0px!important;margin-bottom:10px!important;margin-left:0px!important;}}@media only screen and (max-width:640px) {.fusion-title.fusion-title-8{margin-top:0px!important; margin-right:0px!important;margin-bottom:20px!important; margin-left:0px!important;}}<\/style><div class=\"fusion-title title fusion-title-8 fusion-sep-none fusion-title-text fusion-title-size-two\" style=\"margin-top:5px;margin-right:0px;margin-bottom:10px;margin-left:0px;\"><h2 class=\"title-heading-left\" style=\"margin:0;\"><strong>Pulp Demand Going Up<\/strong><\/h2><\/div><div ><span class=\" fusion-imageframe imageframe-none imageframe-3 hover-type-none\"><img width=\"1168\" height=\"470\" title=\"Pulp Pricing Chart\" src=\"https:\/\/www.smithcorona.com\/blog\/wp-content\/uploads\/2017\/12\/Pulp-Pricing-Chart.jpg\" alt class=\"img-responsive wp-image-2319\" srcset=\"https:\/\/www.smithcorona.com\/blog\/wp-content\/uploads\/2017\/12\/Pulp-Pricing-Chart-200x80.jpg 200w, https:\/\/www.smithcorona.com\/blog\/wp-content\/uploads\/2017\/12\/Pulp-Pricing-Chart-400x161.jpg 400w, https:\/\/www.smithcorona.com\/blog\/wp-content\/uploads\/2017\/12\/Pulp-Pricing-Chart-600x241.jpg 600w, https:\/\/www.smithcorona.com\/blog\/wp-content\/uploads\/2017\/12\/Pulp-Pricing-Chart-800x322.jpg 800w, https:\/\/www.smithcorona.com\/blog\/wp-content\/uploads\/2017\/12\/Pulp-Pricing-Chart.jpg 1168w\" sizes=\"(max-width: 1064px) 100vw, (max-width: 640px) 100vw, 1168px\" \/><\/span><\/div><div class=\"fusion-text fusion-text-14\"><p>Rising prices in leuco dye and release liner are not on the only raw materials seeing price hikes. \u00a0Demand for tree pulp has rapidly increased this year as well.<\/p>\n<p>Industry insiders believe that a rise in the demand of recycled corrugated boxes has Chinese paper manufacturers buying pulp in mass quantities, which is in turn reducing the available supply of pulp for label production.<\/p>\n<\/div><\/div><style type=\"text\/css\">.fusion-body .fusion-builder-column-8{width:100% !important;margin-top : 0px;margin-bottom : 20px;}.fusion-builder-column-8 > .fusion-column-wrapper {padding-top : 0px !important;padding-right : 0px !important;margin-right : 1.92%;padding-bottom : 0px !important;padding-left : 0px !important;margin-left : 1.92%;}@media only screen and (max-width:1064px) {.fusion-body .fusion-builder-column-8{width:100% !important;}.fusion-builder-column-8 > .fusion-column-wrapper {margin-right : 1.92%;margin-left : 1.92%;}}@media only screen and (max-width:640px) {.fusion-body .fusion-builder-column-8{width:100% !important;}.fusion-builder-column-8 > .fusion-column-wrapper {margin-right : 1.92%;margin-left : 1.92%;}}<\/style><\/div><\/div><style type=\"text\/css\">.fusion-body .fusion-flex-container.fusion-builder-row-9{ padding-top : 0px;margin-top : 0px;padding-right : 0px;padding-bottom : 0px;margin-bottom : 0px;padding-left : 0px;}<\/style><\/div><div class=\"fusion-fullwidth fullwidth-box fusion-builder-row-10 fusion-flex-container nonhundred-percent-fullwidth non-hundred-percent-height-scrolling\" style=\"background-color: rgba(255,255,255,0);background-position: center center;background-repeat: no-repeat;border-width: 0px 0px 0px 0px;border-color:#eae9e9;border-style:solid;\" ><div class=\"fusion-builder-row fusion-row fusion-flex-align-items-flex-start\" style=\"max-width:1144px;margin-left: calc(-4% \/ 2 );margin-right: calc(-4% \/ 2 );\"><div class=\"fusion-layout-column fusion_builder_column fusion-builder-column-9 fusion_builder_column_1_1 1_1 fusion-flex-column\"><div class=\"fusion-column-wrapper fusion-flex-justify-content-flex-start fusion-content-layout-column\" style=\"background-position:left top;background-repeat:no-repeat;-webkit-background-size:cover;-moz-background-size:cover;-o-background-size:cover;background-size:cover;padding: 0px 0px 0px 0px;\"><style type=\"text\/css\">@media only screen and (max-width:1064px) {.fusion-title.fusion-title-9{margin-top:5px!important; margin-right:0px!important;margin-bottom:10px!important;margin-left:0px!important;}}@media only screen and (max-width:640px) {.fusion-title.fusion-title-9{margin-top:0px!important; margin-right:0px!important;margin-bottom:20px!important; margin-left:0px!important;}}<\/style><div class=\"fusion-title title fusion-title-9 fusion-sep-none fusion-title-text fusion-title-size-two\" style=\"margin-top:5px;margin-right:0px;margin-bottom:10px;margin-left:0px;\"><h2 class=\"title-heading-left\" style=\"margin:0;\"><strong>Other Raw Material Price Increases<\/strong><\/h2><\/div><div style=\"text-align:center;\"><span class=\" fusion-imageframe imageframe-none imageframe-4 hover-type-none\"><img width=\"345\" height=\"327\" alt=\"A graph shows the price increases for other raw materials\" title=\"WTI Crude Graph Image\" src=\"https:\/\/www.smithcorona.com\/blog\/wp-content\/uploads\/2017\/12\/wti_crude-2017-12-14.png\" class=\"img-responsive wp-image-2344\" srcset=\"https:\/\/www.smithcorona.com\/blog\/wp-content\/uploads\/2017\/12\/wti_crude-2017-12-14-200x190.png 200w, https:\/\/www.smithcorona.com\/blog\/wp-content\/uploads\/2017\/12\/wti_crude-2017-12-14.png 345w\" sizes=\"(max-width: 1064px) 100vw, (max-width: 640px) 100vw, 345px\" \/><\/span><\/div><div class=\"fusion-text fusion-text-15\"><p><span style=\"font-weight: 400;\">Oil, rubber, and silicone have also seen price increases over the past year as well.\u00a0 <\/span><\/p>\n<p><span style=\"font-weight: 400;\">This impacts label prices of both <a href=\"https:\/\/www.smithcorona.com\/direct-thermal-labels.html\" target=\"_blank\" rel=\"noopener noreferrer\">direct thermal<\/a> and <a href=\"https:\/\/www.smithcorona.com\/thermal-transfer-labels.html\" target=\"_blank\" rel=\"noopener noreferrer\">thermal transfer<\/a>.\u00a0 <\/span><\/p>\n<p><span style=\"font-weight: 400;\">The reason for that is that every<\/span>\u00a0pressure sensitive label has to have a silicone coating as a release agent, otherwise the labels would never peel off of the paper.<\/p>\n<p>Also, one other thing that we didn&#8217;t include a graph of are increased wages over the past 6 years.<\/p>\n<p>The combination of these four factors have all weighed into the increased price of thermal paper.<\/p>\n<\/div><div ><span class=\" fusion-imageframe imageframe-none imageframe-5 hover-type-none\"><img width=\"800\" height=\"322\" alt=\"A graph showing the imported price increase\" title=\"Fred Graph Image\" src=\"https:\/\/www.smithcorona.com\/blog\/wp-content\/uploads\/2017\/12\/fredgraph-4-800x322.png\" class=\"img-responsive wp-image-2345\" srcset=\"https:\/\/www.smithcorona.com\/blog\/wp-content\/uploads\/2017\/12\/fredgraph-4-200x80.png 200w, https:\/\/www.smithcorona.com\/blog\/wp-content\/uploads\/2017\/12\/fredgraph-4-400x161.png 400w, https:\/\/www.smithcorona.com\/blog\/wp-content\/uploads\/2017\/12\/fredgraph-4-600x241.png 600w, https:\/\/www.smithcorona.com\/blog\/wp-content\/uploads\/2017\/12\/fredgraph-4-800x322.png 800w, https:\/\/www.smithcorona.com\/blog\/wp-content\/uploads\/2017\/12\/fredgraph-4.png 1168w\" sizes=\"(max-width: 1064px) 100vw, (max-width: 640px) 100vw, 800px\" \/><\/span><\/div><\/div><style type=\"text\/css\">.fusion-body .fusion-builder-column-9{width:100% !important;margin-top : 0px;margin-bottom : 20px;}.fusion-builder-column-9 > .fusion-column-wrapper {padding-top : 0px !important;padding-right : 0px !important;margin-right : 1.92%;padding-bottom : 0px !important;padding-left : 0px !important;margin-left : 1.92%;}@media only screen and (max-width:1064px) {.fusion-body .fusion-builder-column-9{width:100% !important;}.fusion-builder-column-9 > .fusion-column-wrapper {margin-right : 1.92%;margin-left : 1.92%;}}@media only screen and (max-width:640px) {.fusion-body .fusion-builder-column-9{width:100% !important;}.fusion-builder-column-9 > .fusion-column-wrapper {margin-right : 1.92%;margin-left : 1.92%;}}<\/style><\/div><\/div><style type=\"text\/css\">.fusion-body .fusion-flex-container.fusion-builder-row-10{ padding-top : 0px;margin-top : 0px;padding-right : 0px;padding-bottom : 0px;margin-bottom : 0px;padding-left : 0px;}<\/style><\/div><div class=\"fusion-fullwidth fullwidth-box fusion-builder-row-11 fusion-flex-container nonhundred-percent-fullwidth non-hundred-percent-height-scrolling\" style=\"background-color: rgba(255,255,255,0);background-position: center center;background-repeat: no-repeat;border-width: 0px 0px 0px 0px;border-color:#eae9e9;border-style:solid;\" ><div class=\"fusion-builder-row fusion-row fusion-flex-align-items-flex-start\" style=\"max-width:1144px;margin-left: calc(-4% \/ 2 );margin-right: calc(-4% \/ 2 );\"><div class=\"fusion-layout-column fusion_builder_column fusion-builder-column-10 fusion_builder_column_1_1 1_1 fusion-flex-column\"><div class=\"fusion-column-wrapper fusion-flex-justify-content-flex-start fusion-content-layout-column\" style=\"background-position:left top;background-repeat:no-repeat;-webkit-background-size:cover;-moz-background-size:cover;-o-background-size:cover;background-size:cover;padding: 0px 0px 0px 0px;\"><style type=\"text\/css\">@media only screen and (max-width:1064px) {.fusion-title.fusion-title-10{margin-top:5px!important; margin-right:0px!important;margin-bottom:10px!important;margin-left:0px!important;}}@media only screen and (max-width:640px) {.fusion-title.fusion-title-10{margin-top:0px!important; margin-right:0px!important;margin-bottom:20px!important; margin-left:0px!important;}}<\/style><div class=\"fusion-title title fusion-title-10 fusion-sep-none fusion-title-text fusion-title-size-two\" style=\"margin-top:5px;margin-right:0px;margin-bottom:10px;margin-left:0px;\"><h2 class=\"title-heading-left\" style=\"margin:0;\"><strong>Indirect Effects?<\/strong><\/h2><\/div><div class=\"fusion-text fusion-text-16\"><p><span style=\"font-weight: 400;\">In addition to price increase on receipt paper, direct thermal labels, and thermal release liner, a whole slew of related products could be affected as well. <\/span><\/p>\n<p><span style=\"font-weight: 400;\">Thermal transfer labels and <a href=\"https:\/\/www.smithcorona.com\/thermal-transfer-ribbons.html\" target=\"_blank\" rel=\"noopener noreferrer\">ribbons<\/a> are two items that come to mind. \u00a0In the world of thermal printing, there are two different types of label paper. \u00a0One is <\/span><a href=\"https:\/\/www.smithcorona.com\/direct-thermal-labels.html\" target=\"_blank\" rel=\"noopener noreferrer\"><b>direct thermal<\/b><\/a><span style=\"font-weight: 400;\">, of which this article is dedicated to. The second is <\/span><a href=\"https:\/\/www.smithcorona.com\/thermal-transfer-labels.html\" target=\"_blank\" rel=\"noopener noreferrer\"><b>thermal transfer<\/b><\/a><span style=\"font-weight: 400;\">. \u00a0Thermal transfer labels are different from direct thermal labels, in that they require a wax ribbon to print. \u00a0(Click here learn more about <\/span><a href=\"https:\/\/www.smithcorona.com\/direct-thermal-vs-thermal-transfer.html\" target=\"_blank\" rel=\"noopener noreferrer\"><span style=\"font-weight: 400;\">thermal transfer vs. direct thermal labels<\/span><\/a><span style=\"font-weight: 400;\">). \u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Traditionally, it has been a little bit cheaper to use thermal transfer labels than direct thermal labels. \u00a0In the short term, that gap should widen as direct thermal prices increase due to all of the factors already mentioned. \u00a0However, that shouldn\u2019t last long.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">If a wave of direct thermal users make the switch to thermal transfer labels, we could see a squeeze on the supply of the wax ribbons needed in thermal transfer printers. \u00a0In 2011, we experienced just that. \u00a0There was a global shortage of wax ribbons that came as a result of fluctuating polyethylene terephthalate (PET) film prices. \u00a0The shortage was accelerated by a huge spike in demand for solar panels, which requires the same 4.5 micron PET film utilized in production of thermal wax ribbons. PET film is one of the components that is used to make thermal wax ribbons. \u00a0\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">This shortage led to roughly 18 months of instability in thermal wax ribbon prices. \u00a0It is entirely possible that if a high percentage of direct thermal users switch to thermal transfer, there could be a rise in wax ribbon prices. <\/span><\/p>\n<\/div><\/div><style type=\"text\/css\">.fusion-body .fusion-builder-column-10{width:100% !important;margin-top : 0px;margin-bottom : 20px;}.fusion-builder-column-10 > .fusion-column-wrapper {padding-top : 0px !important;padding-right : 0px !important;margin-right : 1.92%;padding-bottom : 0px !important;padding-left : 0px !important;margin-left : 1.92%;}@media only screen and (max-width:1064px) {.fusion-body .fusion-builder-column-10{width:100% !important;}.fusion-builder-column-10 > .fusion-column-wrapper {margin-right : 1.92%;margin-left : 1.92%;}}@media only screen and (max-width:640px) {.fusion-body .fusion-builder-column-10{width:100% !important;}.fusion-builder-column-10 > .fusion-column-wrapper {margin-right : 1.92%;margin-left : 1.92%;}}<\/style><\/div><\/div><style type=\"text\/css\">.fusion-body .fusion-flex-container.fusion-builder-row-11{ padding-top : 0px;margin-top : 0px;padding-right : 0px;padding-bottom : 0px;margin-bottom : 0px;padding-left : 0px;}<\/style><\/div><div class=\"fusion-fullwidth fullwidth-box fusion-builder-row-12 fusion-flex-container nonhundred-percent-fullwidth non-hundred-percent-height-scrolling\" style=\"background-color: rgba(255,255,255,0);background-position: center center;background-repeat: no-repeat;border-width: 0px 0px 0px 0px;border-color:#eae9e9;border-style:solid;\" ><div class=\"fusion-builder-row fusion-row fusion-flex-align-items-flex-start\" style=\"max-width:1144px;margin-left: calc(-4% \/ 2 );margin-right: calc(-4% \/ 2 );\"><div class=\"fusion-layout-column fusion_builder_column fusion-builder-column-11 fusion_builder_column_1_1 1_1 fusion-flex-column\"><div class=\"fusion-column-wrapper fusion-flex-justify-content-flex-start fusion-content-layout-column\" style=\"background-position:left top;background-repeat:no-repeat;-webkit-background-size:cover;-moz-background-size:cover;-o-background-size:cover;background-size:cover;padding: 0px 0px 0px 0px;\"><style type=\"text\/css\">@media only screen and (max-width:1064px) {.fusion-title.fusion-title-11{margin-top:5px!important; margin-right:0px!important;margin-bottom:10px!important;margin-left:0px!important;}}@media only screen and (max-width:640px) {.fusion-title.fusion-title-11{margin-top:0px!important; margin-right:0px!important;margin-bottom:20px!important; margin-left:0px!important;}}<\/style><div class=\"fusion-title title fusion-title-11 fusion-sep-none fusion-title-text fusion-title-size-two\" style=\"margin-top:5px;margin-right:0px;margin-bottom:10px;margin-left:0px;\"><h2 class=\"title-heading-left\" style=\"margin:0;\"><h2><strong>Future Outlook \/ \u00a0Predictions<\/strong><\/h2><\/h2><\/div><div class=\"fusion-text fusion-text-17\"><p><span style=\"font-weight: 400;\">As coaters, converters, dealers, and end users project into 2018, all eyes will be focused on what happens in China. \u00a0Without a steady and sufficient supply of leuco dye, thermal paper prices are going to continue to rise. \u00a0What makes this particularly troublesome is that the future of leuco dye production at Connect Chemicals is very much in doubt. \u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Many industry insiders including Gary Huang, Hancock International director and co-chairman of the AmCham Shanghai Supply Chain Committee believe that the anti-pollution push by Beijing is a concerted effort to push low value \/ high polluting manufacturers out of China for good. \u00a0(CITE: Bills article). \u00a0According to Gary:<\/span><\/p>\n<\/div><div class=\"fusion-text fusion-text-18\"><blockquote>\n<p>\u201cThe sentiment is that these heavy polluters mainly make low value items and China is willing to allow these industries to move out of China and to India, Cambodia, etc.\u201d<sup>5<\/sup><\/p>\n<\/blockquote>\n<\/div><div class=\"fusion-text fusion-text-19\"><p>If Gary is right and China is no longer going to be a viable place to produce leuco dye, the thermal paper market could be in for a much longer shortage than initially expected. \u00a0If that prediction becomes a reality\u2026.<\/p>\n<\/div><div class=\"fusion-separator fusion-full-width-sep\" style=\"align-self: center;margin-left: auto;margin-right: auto;margin-top:10px;margin-bottom:10px;width:100%;\"><\/div><\/div><style type=\"text\/css\">.fusion-body .fusion-builder-column-11{width:100% !important;margin-top : 0px;margin-bottom : 20px;}.fusion-builder-column-11 > .fusion-column-wrapper {padding-top : 0px !important;padding-right : 0px !important;margin-right : 1.92%;padding-bottom : 0px !important;padding-left : 0px !important;margin-left : 1.92%;}@media only screen and (max-width:1064px) {.fusion-body .fusion-builder-column-11{width:100% !important;}.fusion-builder-column-11 > .fusion-column-wrapper {margin-right : 1.92%;margin-left : 1.92%;}}@media only screen and (max-width:640px) {.fusion-body .fusion-builder-column-11{width:100% !important;}.fusion-builder-column-11 > .fusion-column-wrapper {margin-right : 1.92%;margin-left : 1.92%;}}<\/style><\/div><\/div><style type=\"text\/css\">.fusion-body .fusion-flex-container.fusion-builder-row-12{ padding-top : 0px;margin-top : 0px;padding-right : 0px;padding-bottom : 0px;margin-bottom : 0px;padding-left : 0px;}<\/style><\/div><div class=\"fusion-fullwidth fullwidth-box fusion-builder-row-13 fusion-flex-container nonhundred-percent-fullwidth non-hundred-percent-height-scrolling\" style=\"background-color: rgba(255,255,255,0);background-position: center center;background-repeat: no-repeat;border-width: 0px 0px 0px 0px;border-color:#eae9e9;border-style:solid;\" ><div class=\"fusion-builder-row fusion-row fusion-flex-align-items-flex-start\" style=\"max-width:1144px;margin-left: calc(-4% \/ 2 );margin-right: calc(-4% \/ 2 );\"><div class=\"fusion-layout-column fusion_builder_column fusion-builder-column-12 fusion_builder_column_1_1 1_1 fusion-flex-column\"><div class=\"fusion-column-wrapper fusion-flex-justify-content-flex-start fusion-content-layout-column\" style=\"background-position:left top;background-repeat:no-repeat;-webkit-background-size:cover;-moz-background-size:cover;-o-background-size:cover;background-size:cover;padding: 0px 0px 0px 0px;\"><div class=\"fusion-text fusion-text-20\"><p>Sources:<\/p>\n<ol>\n<li>http:\/\/www.telemarkcorp.com\/statement-appvion-10302017\/<\/li>\n<li>http:\/\/www.flexreceipts.com\/blog\/survey-data-shows-digital-receipts-on-the-rise<\/li>\n<li>https:\/\/www.reuters.com\/article\/legal-us-appvion-bankruptcy\/paper-maker-appvion-files-for-bankruptcy-idUSKCN1C71DA<\/li>\n<li>http:\/\/www.telemarkcorp.com\/paper-shortage-update-price-increases\/<\/li>\n<li>http:\/\/www.appvion.com\/en-us\/products\/thermal\/Documents\/Thermal\/Therm_VDC_White_Paper.pdf<\/li>\n<\/ol>\n<\/div><\/div><style type=\"text\/css\">.fusion-body .fusion-builder-column-12{width:100% !important;margin-top : 0px;margin-bottom : 20px;}.fusion-builder-column-12 > .fusion-column-wrapper {padding-top : 0px !important;padding-right : 0px !important;margin-right : 1.92%;padding-bottom : 0px !important;padding-left : 0px !important;margin-left : 1.92%;}@media only screen and (max-width:1064px) {.fusion-body .fusion-builder-column-12{width:100% !important;}.fusion-builder-column-12 > .fusion-column-wrapper {margin-right : 1.92%;margin-left : 1.92%;}}@media only screen and (max-width:640px) {.fusion-body .fusion-builder-column-12{width:100% !important;}.fusion-builder-column-12 > .fusion-column-wrapper {margin-right : 1.92%;margin-left : 1.92%;}}<\/style><\/div><\/div><style type=\"text\/css\">.fusion-body .fusion-flex-container.fusion-builder-row-13{ padding-top : 20px;margin-top : 0px;padding-right : 0px;padding-bottom : 20px;margin-bottom : 0px;padding-left : 0px;}<\/style><\/div><\/p>\n","protected":false},"excerpt":{"rendered":"<p>A key chemical used in the making of direct thermal paper is about to be in low supply and high demand thanks to a plant shutdown in China. This shortage will have worldwide ramifications in every industry across the supply chain. How are these closures going to affect the label &amp; receipt industry?<\/p>\n","protected":false},"author":8,"featured_media":12567,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[59],"tags":[],"acf":{"theme_color":"","estimated_reading_time":8,"include_in_most_popular_sidebar":false,"hero_splash_image":12565,"grid_listing_thumbnail":12566,"sidebar_most_popular_thumbnail":12568},"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v19.7.1 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>How China Plant Closures Are Affecting The Label &amp; Receipt Industry<\/title>\n<meta name=\"description\" content=\"Worldwide direct thermal paper shortage after chemical plant in China is shut down. 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