Summary
- Output grew in the first half of 2023 due to a modest increase in consumer confidence
- There was a decline in the growth of the global install base
- China remains the leader in digitally printed fabric output and equipment sales, despite an economic slowdown
1. Market overview
The digital textile printing market produced 1.584bn sqm of fabric in the first half of 2023, an increase of 2% on the second half of last year. Productivity is forecast to grow by a further 5% from July to December, which would result in the manufacture of 1.659bn sqm of digitally printed material. Therefore, annual output in 2023 is forecasted at 3.243bn sqm – a rise of 4%.
In general terms, businesses and consumers have reconfigured their finances following the initial shock of last year’s economic downturn, which forced some print service providers (PSPs) to take drastic measures, such as limiting operating times to mitigate spiralling energy costs.
There have been encouraging signs for the digital textile printing market of late. While in Western economies inflation remains stubbornly high, it is gradually falling. Therefore, the strain on consumer finances will begin to ease and their confidence will grow. With more disposable income, demand will return for applications such as fashion and home décor, which are key to the success of the digital textile printing industry.
Supply chains
Supply chain bottlenecks increased the rate of inflation last year, having begun in 2021. Shipping costs remained high because of container shortages, which lengthened lead times. It presented businesses with hidden costs: for instance, from a retailer’s standpoint orders arrived too late for a specific season, so they either had to sell the stock cheap – often at a loss – or pay for its storage.
Supply chain news is not making headlines like it was 18 months ago, but the issues are not fully resolved. The crisis revealed how fragile supply chains were and how they required an overhaul. Some of the issues were external while others were internal, but businesses have taken measures to mitigate both.
External influences caused by uncontrollable events – such as the war in Ukraine or, to lesser extreme, the blockage of the Suez Canal – can cause lengthy lead times.
To try and prevent this, businesses are nearshoring. The aim is to simplify what are very complex supply chains where suppliers, manufacturers and distribution centres are in entirely separate geographies.
Innovation also plays a role. Businesses with substantial investment budgets are implementing process mining, according to Celonis, an expert in the technology. The company says the software solution improves workflows by combining data mining with process analytics.
PSPs and equipment manufacturers in the digital textile printing industry can benefit from such innovative technology: according to US-based computing expert IBM, it enables companies to understand the performance of their processes and reveals areas for improvement.
Material shortages
The supply chain crisis caused textile manufacturers and finishers to scramble for raw materials and costs subsequently increased. However, companies have adapted to remain profitable by improving their supply chain visibility. Industry 4.0 solutions facilitate this and are increasing their influence on the inkjet textile supply chain.
Process mining is an example of a future-proof technology. Celonis says it highlights the most dynamic and reliable suppliers and details their cost, which gives the user more control and enhances their versatility.
Most supply chain challenges have been caused by external factors over the last two years. In response, businesses have made internal changes to mitigate those issues and secure more control – for instance, a restructure in which departments work together rather than individually to improve cohesion and effectiveness.
2. Global forecasts
Digital textile printing output will increase 6% in the first half of 2024, which will result in the manufacture of 1.755bn sqm of digitally printed fabric.
Consumer confidence is expected to improve next year and WTiN forecasts an 8% increase in productivity during the second half of the year. Global output is expected to surpass 3.6bn sqm in 2024, which is an increase of 12%.
WTiN does not predict a return to the levels of growth witnessed between ITMA 2015 and ITMA 2019, because the market is more mature. However, double digital growth is forecast over the next four years, which would culminate in the production of 5.458bn sqm in 2027 – it represents a CAGR of 9% from 2017 to 2027.
Install base
Equipment sales declined across all four regions in the first half of this year. Anticipation for ITMA 2023 in Milan, Italy explains some of the decline but stubborn inflation, which was expected to fall at a much faster rate this year, is another major factor.
Subsequently, consumer confidence has been slow to recover, but there are positive signs. According to the Deloitte Consumer Tracker, confidence improved for a fourth consecutive quarter in Q3 2023. At -14.2% it is the highest it has been since Q4 2021 when the index was at -11.3%. Consumer confidence was at -20.3% this time last year – its lowest level in over a decade.
The sentiment resulted in a drop in sales for brands and retailers, which has resulted in volatile demand for PSPs. The uncertainty has culminated in a decline in new printer installations.
The number of digital roll-to-roll textile printers in operation grew by 2% in the first half of this year. The global install base surpassed 63,000 for the first time with a net increase of 1,088 printers. Courtesy of post-ITMA optimism, WTiN believes the total install base will total 67,047 by the end of the year, which represents 6% growth.
Asia accounts for 44% of these machines, Europe represents a quarter of the market and North America boasts the third largest share with 12%. The regional breakdown has not changed since the end of 2022.
China has become a leader in the manufacture of digital textile printers, ranging from low-volume sublimation to high-speed direct single-pass. Most of these printers are sold domestically to service export orders, but increasingly domestic demand too. The country’s equipment manufacturers were responsible for 42% of the world’s printer sales in H1 2023 – the largest share of any nation.
The global install base will have reached 108,000 by the end of 2027, without any notable shift in the regional percentage shares. Nearshoring, print-on-demand production, sustainability and ecommerce will all contribute to the growth.
Inkjet equipment and consumables will become cheaper as more PSPs turn to the technology. Similarly, as demand falls for rotary screenprinting, equipment manufacturers will exit the market and the cost of the machinery will increase, which will accelerate digital’s share of total printer sales.
3. Regional productivity
Asia
Asia remained the largest producer of digitally printed textiles in the first half of 2023. It accounted for 54% of output courtesy of a 10% increase in productivity since H2 2022. The region’s market share has increased by 3% after China ended its zero Covid-19 policy last year and developing nations in the South and Southeast of the region expanded their digital textile printing offering.
Countries such as Vietnam and Bangladesh have benefitted from China’s now obsolete Covid-19 initiatives. Brands and retailers turned to them for large volume print runs due to growing uncertainty in China. The Chinese economy is slowing and there are fears it will dip into recession. The country is also suffering from deflation, which contrasts with much of the Western world – the root cause of that, however, is low demand in the housing sector.
Youth unemployment is also high, but for now this has had little bearing on domestic demand for digitally printed textiles. More importantly, China’s middle class has grown significantly over the last decade and the country’s textile printers and finishers continue to benefit because it has offset the decline in exports to Europe and North America since the pandemic.
But the arrival of global online fashion and lifestyle retailers, such as Shein, has breathed new life into China’s already dominant digital textile printing industry. The company says it has implemented a customer-driven model that utilises on-demand manufacturing, which is good for the environment.
However, most the company’s fashion items are made of synthetic materials derived from fossil fuels and, according to Time magazine, the scale of businesses production – including the transportation of its goods – contributes to 6.3m tons of carbon dioxide emissions every year.
Europe
Europe maintained a quarter of all output in H1 2023 and 52% of that was printed with dye-sublimation machines. Moreover, 15% of the 373m sqm of fabric printed was produced on super-wide format machines – printers with a width of 3.2m or more – which is testament to the uptick in demand for soft signage applications.
The super-wide-format printing sector occupies a larger share of output in Europe compared with Asia, but the latter still printed 22m sqm more in the first half of the year.
Europe has suffered from the energy crisis more than most due to its proximity to the war in Ukraine and its overreliance on Russian gas. However, businesses have adjusted to the turmoil with fewer taking extreme measures, such as reducing operating times, and in the case of sublimation printers using cheaper protection paper as opposed to more expensive specialist transfer papers.
Maintaining quality is key to retaining customers. PSPs can make cutbacks to a point, but businesses need to look ahead for when demand returns. It is important that they have strong customer relations when it does, but they can only achieve that through innovation, expanding their offering and delivering a consistently good service.
Turkey is a jewel in the crown of Europe’s textile industry and is the region’s second largest digital textile printing market behind Italy, but in the first half of the year productivity slumped 25% compared with the first six months of 2022.
The country was looking to capitalise on a nearshoring movement two years ago, but the recent economic downturn has seen a reduction in orders from key European markets. Consequently, according to WTiN data, there was a net increase of just 12 printers in the first half of 2023.
The depreciation of the Turkish Lira has eroded new machinery investments from foreign equipment providers in addition to the slowdown in printed textile orders.
Another country with a proud yet more modest textile heritage is Poland. Its digital textile printing industry has been evolving and is home to the prominent PSPs Colourama and Print Logistic. Both have acquired new pigment solutions this year: Colourama invested in EFI Reggiani’s ecoTERRA technology and Print Logistic implemented Kornit Digital’s Presto MAX S machine.
North America
WTiN data suggests productivity in North America is volatile. The region’s output was more than 50% up on the same period in 2022 but was down on the second half of last year.
There was an increase in the share of direct output in H1 2023 and there was also a notable uptick in soft signage activity. In the roll-to-roll sector, most of the output was produced on expensive machinery priced between US$250,000 and US$749,999, which is understandable given that 82% was printed with high-speed machines.
The US represents two thirds of productivity in North America and over 40% of that is dedicated to soft signage, which has increased 4% since the same time last year. Sublimation’s share of the US market is also in line with the broader region.
There is a push to expand pigment printing in North America’s roll-to-roll space. Optimum Digital, a Turkish equipment manufacturer who exhibited at the recent PRINTING United exhibition in Atlanta, Georgia in the US, is emphasising the connection between pigment printing and on-demand manufacturing. The company is keen to produce technologies that reduce water consumption in the digital textile printing process.
Italy-based digital textile printer specialist MS Printing Solutions, part of Dover Industries Italy, was also present at PRINTING United. The company is striving to capitalise on North America’s vibrant soft signage market and launched its new JP4 EVO 3.2m, which targets such applications.
Rest of the world
South America is the most productive region out of the remaining markets. It produced more than 81m sqm in the first half of this year, which represented 5% of global productivity and was 3% higher than the second half of 2022.
There was a four-point increase in the market share of sublimation output and much of the inkjet productivity was produced on printers ranging from 1000mm and 1800mm wide. Moreover, high-speed machines represented 86% of the region’s output.
Half of all digitally printed textiles in South America are produced in Brazil, but there is work to do to sell the benefits of the technology in surrounding nations. Argentina and Colombia have sizeable markets but, in the former, there are only a small number of industrial print houses who have inkjet equipment in their arsenal.
Buenos Aires-based print-on-demand specialist Mercado Estampa is informing the textile industry about the benefits of inkjet printing to inspire new start-ups. The small-scale PSP also strives to minimise its environmental footprint and wants to generate new opportunities for consumers and aspiring designers. The company has gained a lot of traction online and hopes its efforts will accelerate the adoption of green textile printing technology in Argentina throughout the remainder of this decade.
However, the country’s economy has been hampered by the depreciation of the Peso and it has yet to see any benefit from the much-talked-about nearshoring. South American economies are still largely dependent on cheap Asian imports.
Elsewhere, Africa produced 55.6m sqm of digitally printed fabric, which was 4% of global output and a rise of 7% on the second half of 2022. Almost two thirds of fabric was printed with sublimation transfer machines, which was a decline of three percentage points on the first half of 2022. There was also a notable increase in soft signage printing compared with the same period last year.
The Middle East produced 41.4m sqm in H1 2023, which was below what it manufactured in the second half of 2022. But in a turn of fortunes, WTiN predicts 47m sqm will be printed in the second half of 2023. There was an even split between direct and sublimation output, which is testament to the region’s home décor production.
Productivity rose by a quarter to 37m sqm in Oceania and by the end of this year the region will be printing more than 70m sqm annually. Over half of the region’s output has been printed using high-speed sublimation transfer machines.
4. Applications
Fashion applications represented 47% of global output in the first half of 2023, which is unchanged since the end of 2022 despite a 3% increase in productivity. Asia manufactures 52% of the world’s digitally printed fashion and will maintain that majority throughout the remainder of the year. Fashion output will increase 5% to 790.7m sqm in H2 2023 because consumer confidence is expected to strengthen as inflation falls.
Demand for sportswear is traditionally more consistent. It increased 6% in the first half of 2023 and is forecast to grow a further 7% in the second six months of the year. The application will account for 489m sqm of digitally printed fabric this year, which will represent 15% of the market.
Since the Covid-19 pandemic, home décor has been reported on a lot in the digital textile printing space. After an unprecedented spike in demand during lockdowns, the application share is beginning to fall back – but at 22% it remains higher than what we saw in 2019. Home textile printing increased 6% in H1 2023, but it will stagnate in the second half of the year.
Meanwhile, soft signage PSPs have welcomed a much-needed increase in orders. Events are key to the application’s growth and in the second half of 2022 they were organised with more certainty. Despite a decline in the first half of this year, soft signage output was up 41% on H1 2022 and its market share was 5% higher.
5. Sustainability
At ITMA 2023 in Milan, pigment inks dominated exhibition stands in the digital textile printing hall.
The technology has undergone extensive development in recent years and the latest solutions on display garnered a lot of interest, but is that attention resulting in increased investment?
One of the biggest advantages of pigment printing is that the fabric doesn’t need treating, which also eradicates the wash-off phase after the printing is completed. Compared with reactive formulas – according to WTiN, the dominant direct-to-fabric ink formula – pigments are more energy efficient and consume less water and fewer chemicals.
Moreover, the fact that fewer process steps are involved in pigment printing helps PSPs meet the increasing demands of modern-day consumers, which includes faster turnaround times. This ability also supports the print-on-demand manufacturing model, which dramatically reduces waste and limits energy and water consumption.
There is now an emphasis on how and where a consumer product is produced among many consumers. In this scenario, PSPs, brands and retailers come under fire, but it is important to consider the environmental impact of equipment providers too. Many are researching and developing more sustainable solutions for their customers, but are the manufacturing processes of equipment providers as green as they could be?
Some companies are leading by example by setting out green targets and steps in which to achieve a greater level of sustainability. Measures include renewable energy sources and planting trees in the case of transfer paper providers. The aim is for equipment manufacturers to become less dependent on the grid.
The textile industry has an issue with greenwashing, therefore in the digital textile printing sector it is important that promises made in marketing campaigns are realised by users. For instance, quality still determines the bulk of investments, yet it is true that many pigment solutions require a fabric pretreatment to achieve optimum results. It is important that equipment and consumable providers are transparent about product limitations so that they can catalogue positive use cases and further accelerate pigment adoption.
Consumers are calling for more transparency and advancements in RFID are aiding their cause. The technology has a range of capabilities, such as asset tracking, which can be used to inform consumers about a product’s history. With that information they can make a more informed purchasing decision.
Demand for sustainable textiles is too weak to influence business practices on a large scale, so to accelerate the green transition governments have resorted to legislation. The European Union has been active in this regard, but the textile industry is global and developing nations need to be incentivised too. A collective effort is required to tackle the issue of sustainability otherwise the shift will be sluggish.
Moreover, in the textile printing space businesses often rely on cheap inventory from abroad, despite supply chain vulnerabilities. Doing this increases their Scope 2 and Scope 3 emissions, which are often overlooked.
But for the most part, inkjet technology is in a strong position regarding the environment. It remains the greenest solution in the textile printing industry, but despite advancements to pigment inks the sector cannot sit back. More work is required to build confidence in the performance and reliability of more sustainable technologies.
Key takeaways
- The digital textile printing market produced 1.584bn sqm of fabric in the first half of 2023, which was an increase of 2% on the second half of last year.
- Global output is expected to surpass 3.6bn sqm in 2024, which is an increase of 12%.
- China’s equipment manufacturers were responsible for 42% of the world’s printer sales in H1 2023 – the largest share of any country.
- The install base of digital textile printers is forecast to be 108,000 by the end of 2027.
- Pigment inks are considered to be a green solution and their use is expected to accelerate between now and 2030.
- Fashion applications increased 5% in H1 2023, and it is estimated that growth will strengthen during the second half of the year.
