Thermal Paper Market Size, Share & Industry Analysis, By Width (2.25”, 3.125”, and Others), By Printing Technology (Direct Thermal, Thermal Transfer, and Others), By Application (Point-of-Sale, Tags & Labels, Ticketing, Lottery & Gaming, Medical, and Others), and Regional Forecast, 2020-2027

The global thermal paper market size was USD 3.45 billion in 2019 and is projected to reach USD 5.85 billion by 2027, exhibiting a CAGR of 6.9% during the forecast period.

Thermal paper is a type of specialty paper that transforms color when subjected to heat, and prints information without the need for any conventional ink. The effect is accomplished by coating a mixture of heat-sensitive dyes and color-developers during the manufacturing process on the base paper. These compounds include leuco dyes, organic acid developers, and sensitizers. Leuco dye is made up of a colorless crystalline powder which melts under heat and mixes with an organic acid, also known as a developer, to form an opaque color. The most commonly used developers are Bisphenol-A (BPA) or Bisphenol-S (BPS). This paper is primarily utilized at point-of-sale (POS) terminals, ATMs, credit card terminals, and labeling instruments. Exclusion of traditional inks makes printing with this type of paper at remote locations possible, thus making it attractive for usage in e-commerce labels and ticketing applications.

MARKET TRENDS

Replacement of Bisphenol-A with Novel Color Developers

The traditional thermal paper utilized BPA as the organic acid developer to produce the image on a paper. But with pharmacological studies suggesting endocrine-disruption and fertility reduction due to transdermal absorption of BPA, stringent regulations are placed on BPA by the European Union and the US-EPA. Thus, manufacturers have started to replace it with novel products such as BPS and Pergafast-201. Manufacturers have also utilized developers such as BPS-MAE, TGSA, d-8, and d-90, that are considered safe for mankind.

According to a report by the European Chemicals Agency, the share of BPA-based paper present in Europe fell from 56.01% to 48.30% during 2015 to 2018 while the share of BPS-based paper rose from 13.94% to 21.16% and other developers-based paper saw growth from 30.06% to 30.54% during the same period. With a ban being placed in Europe from FY2020, the utilization of novel developers is expected to further magnify during the forecast period.

MARKET DRIVERS

Increasing Product Demand from Label Manufacturers for Applications in E-Commerce and Logistics Industries

The demand for transportation of goods and products has grown considerably in the recent past with e-commerce strongly rooting itself in developed economies and expanding tremendously in emerging economic powerhouses such as China and India. According to Pitney Bowes Parcel Shipping Index, global parcel volume per annum is projected to cross 200 billion mark by 2025. Transportation and logistics companies utilize labels made of thermal paper to mark the parcels with tracking QR-codes, barcodes and descriptions of the consignor and recipient. This type of paper does not utilize traditional ink, which makes it smudge-proof and moisture-proof, thus making it suitable for usage in transportation and handling of goods. Due to this factor, transportation companies are increasingly adopting this paper for printing labels for packages, providing a pathway for the thermal paper market growth.

Increase in ATM transactions Will Drive the Market

In the past few years, the number of transactions carried out at ATMs has risen significantly, mainly due to the improving spending capacity of the people across the globe. According to the National Cash Systems, over 10 billion ATM transactions are carried out in the US annually. ATM transactions generally produce a receipt at the end of the transaction which is printed on the this paper. Thus rise in the number of transactions carried out at ATMs will emerge in favor of market growth.

MARKET RESTRAINT

Growth in Online and Paperless E-transactions Impedes the Acceptance of Thermal Paper

The concept of paperless ‘e-receipts’ has become more feasible, as an increasingly large number of retail merchants and businesses are making their transactions online. Furthermore, growing usage of monetary transaction services like Paypal and Unified Payment Interface (UPI) and bank cards in everyday purchases are likely to replace paper receipts with e-receipts, thus impeding the growth of the market. Moreover, rising consumer awareness against harms caused by ingestion of BPA will lead to an adoption of e-receipts instead of paper receipts, further decelerating the market growth.

SEGMENTATION

By Width Analysis

3.125” (80 mm) Width Segment to Hold Largest Share in the Market throughout the Forecast Period

Based on width, the market is classified into 2.25” (57 mm), 3.125” (80mm), and others. Thermal paper manufacturers produce such papers in multitude of widths ranging from 1.46” (37 mm) to 4.33” (110 mm) along with full-scape papers and customized sizes. Out of all these widths, 3.125” papers are utilized in the largest volume owing to heavy demand for this size for usage in POS terminals and lottery tickets. The growing number of supermarkets/hypermarkets and digitalized billing counters at brick-and-mortar shops have created a heavy demand for this paper as a result of which this segment is accounting for such a large share in the market.

On the other hand, 2.25” width segment also holds a significant share in the market owing to heavy consumption for labeling and ticketing applications. Furthermore, card payment terminals utilize 2.25” width thermal paper, and with a growing number of cashless transactions in developing economies, the market for 2.25” paper is expected to grow at a steady pace during the forecast period.

By Printing Technology Analysis

Direct Thermal Segment to Account for the Largest Market Share

In terms of printing technology, the market is segmented into direct thermal, thermal transfer, and others. Direct thermal printing technology is mostly used by the logistics and retail industries due to its low-cost printing capabilities. Direct thermal printers can be as small as a mobile device, making them easy to carry and print as and when required. Furthermore, direct thermal printing is cheaper as compared to thermal transfer printing which increases the margin potential for the service provider. Thus, direct thermal segment is projected to account for the largest share in the market.

On the other side, the thermal transfer segment is to expected gain a considerable market share during the forecast period due to the ability of printing on different paper quality with the same performance, which makes it attractive to print labels and tags on thermal paper. Thermal transfer printing machinery has a longer print head lifetime and the print is longer resistant to fading and smudging as compared to direct thermal printing, and thus is expected to narrow the lead of direct thermal segment.

By Application Analysis

Point-of-Sale (POS) Segment to Account for Dominant Share in the Thermal Paper Market

Based on application, the market is segmented into point-of-sale (POS), tags & labels, ticketing, lottery & gaming, medical, and others. POS segment is expected to account for a dominant share in this market in terms of volume on account of the rising number of POS terminals, especially in Europe and Asia. According to the European Association for Secure Transactions, more than 14.5 million POS terminals are deployed across Europe, indicating the potential for growth of the market.

Besides POS, medical segment is expected to witness significant growth in the market owing to the increasing usage of this type of paper in printing reports and medical wrist bands. Wrist bands printed with direct thermal printing technology help the medical staff to confirm the treatments or procedures prescribed for a particular patient and ensure proper patient care without maintaining a physical file. These factors shall result into the expansion of its application in the medical industry.

REGIONAL ANALYSIS

The thermal paper market size in Europe stood at USD 1.57 billion in 2019. Europe is expected to lead the market owing to the large retail sector in the region, consisting of a large number of POS terminals and digital billing equipment. Furthermore, the demand for this paper for medical applications in the region is increasing opening up a huge potential for the growth of the market. The market in North America will be governed by the growth of the retail sector in the US. As the region is expected to recover from the global pandemic of COVID-19 during the forecast period, demand for labels from shipping & logistics companies is expected to grow to address the demand for heavy volumes of parcels transported to and from the region. Furthermore, growth in the lottery & gaming industry in the region shall propel the this market in the region.

On the other hand, the thermal paper market in Asia Pacific will be driven by the growth of the POS terminals and the number of card-based transactions in the region. Moreover, the infrastructure development in countries such as India and China has increased the demand for ticketing in travel and entertainment sectors, thus resulting in significant market growth. The requirement for tags and labels has significantly expanded in Latin America due to the demand from the beverage industry present in the region. This demand can be fulfilled by paper labels and thus is expected to create opulent growth opportunities for the market. The market in the Middle East & Africa will follow the growth of the logistics sector of the region, which is growing owing to the large shipping industry present in the region.

KEY INDUSTRY PLAYERS

Key Market Players Focused on Mergers & Acquisitions of Smaller Companies to Maintain Their Authority in the Market

The competitive landscape of this market depicts a fairly consolidated market with the top 5 companies accounting for a majority share in the market. Key players in the market are investing a large number of resources in research and development of thermal paper grades and applications. Companies are focusing on research and development of BPA-free paper, along with new coatings to improve the performance against temperature fluctuations and smudging as a course-way to gain market share.

Furthermore, key players operating in the market have adopted the strategy of capacity expansion and acquisition of smaller enterprises to improve their offering portfolio and services. This trend is projected to positively impact the global market during the forecast period.

LIST OF KEY COMPANIES PROFILED:

• Lecta (Spain)


• Hansol Paper (Korea)


• Appvion Operations, Inc. (USA)


• Domtar Corporation (USA)


• Ricoh Industrie France SAS (France)


• Mitsubishi Hi-Tech Paper (Germany)


• Koehler Paper Group (Germany)


• Kanzaki Specialty Papers, Inc. (USA)


• Jujo Thermal Ltd. (Finland)


• Oji Paper Co., Ltd. (Japan)


• Kanzan Spezialpapiere GmbH (Germany)


• Iconex LLC (UK)


• Telemark Diversified Graphics (USA)


• Panda Paper Roll (China)


• Nakagawa Manufacturing (USA), Inc. (USA)


• Suzhou Xiandai Paper Production Co., Ltd. (China)


• PG Paper Company Ltd. (UK).


• Thermal Paper China (China)


• Chenming Group (China)


• Guangdong Guanhao High-Tech Co., Ltd. (China)


• Other Key Players

KEY INDUSTRY DEVELOPMENTS:

• July 2019 – Lecta announced that all the thermal paper it supplies in the European Union will be BPA-free, to comply with the prohibition announced by the EU from January 2020.


• February 2020 – Domtar Corporation announced the acquisition of the POS paper business of Appvion Operations, Inc. The transaction includes acquirement of the coater and related equipment located at Appvion’s Ohio based facility. Domtar seeks to make a globally competitive POS paper business and open new avenues for the growth of the company via this acquisition.

REPORT COVERAGE

The thermal paper market report provides a detailed analysis of the market and focuses on key aspects such as leading companies, printing technologies, and leading applications of the thermal paper. Besides this, the report offers insights into the market trends and highlights key industry developments. In addition to the aforementioned factors, the report encompasses several factors that have contributed to the growth of the market over recent years.

Report Scope & Segmentation