When will you start using plates from China?

By | December 17, 2008

Although they have not been prominent at trade shows in the US or in US sales channels, Chinese plate manufacturers are currently selling about 20% of the world’s offset plates. Not only that, they have production capacity sufficient to provide almost 50% of the world requirement for plates, and their capacity continues to expand. Will they ever become a force in the US market?

 

I think they will. Although the Big Three plate vendors (Agfa, Fuji, and Kodak) have been mounting a battle against the Chinese vendors in Europe, the Chinese are making inroads. About a dozen Chinese plate vendors took space at Drupa to hawk their wares, which include every plate type, from garden-variety UV-sensitive conventional plates to what are apparently the only commercially-viable thermal switchable-polymer plates available anywhere. And the prices are, in many cases, breathtakingly low.

 

Michael Mittelhaus, who is Europe’s leading CTP analyst, has written a report on the Chinese plate vendors, based on discussions with each of the Asian (not just Chinese) vendors at Drupa, plus some that weren’t at Drupa. He also spoke with European dealers who have been testing (and, in a few cases, selling) Chinese plates, with CTP vendors who have tested the plates, and with the Big Three themselves about the role the Chinese may play in the plate market. His 54-page report is a real eye-opener. I would consider it “must reading” for anyone who is responsible for purchasing plates or who is involved in selling them. It is worth far more than its sub-$400 price tag. You will find more information about it, including the report’s table of contents, here. (Full disclosure: I did the translation of the report from the German and I stand to get a commission on any English-language sales.)

 

Although the report is specific to the European market, all of its main points apply in North America as well. Chinese plates are already being used without problems in some environments. For specific Chinese vendors, there can still be issues in several areas, such as quality variations, lack of local warehousing, or lack of local technical support. But the plate prices are so low that distributors will have plenty of margin to deal with these issues and still make a good return. To quote the words that end the report, “If, at Drupa 2012 or 2016, the biggest vendors of plates (and other consumables) have names that are not so familiar to us today, no one who has read this report will be able to say: We couldn’t have seen this coming.”

 

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2 thoughts on “When will you start using plates from China?

  1. Andy McCourt

    Are there Chinese manufacturers of CTP machines also? Any vendor worth his pay will tie the CTP hardware and workflow into a plate contract – witness Agfa’s deal with News Ltd in the UK. Agfa facilitates the production of plates, even has its own support staff onsite, owns the CTP setters and supplies all the plates. It’s not just a question of ‘breathtaking prices’ – CTP is a highly evolved complex system of precision imaging. When you look at the history of CTP, the myraid manufacturers since Creo’s Seybold 1994 launch have mostly been absorbed into plate supply companies because they can supply the support in return for the plate business. Will the Chinese plate manufacturers be able to offer this on equipment they have not made and software they have not written?
    There is no doubting the capability to produce quality plates in China. Xingraphics is breaking into the market here in Australia with Ferag as a distributor. But, as with inkjet ink and the inkjet printers, manufacturers will fight very hard to keep the consumable business because they have to – without it the hardware would cost a lot more and burn up much capital for already stretched printers.
    For the printer, most bottlenecks and breakdowns in smooth workflow happen in the prepress department. The big 3 plate & CTP suppliers Kodak, Agfa and Fujifilm – and we must not forget Presstek and the smaller excellent Esko DPX/DPM machines now from ECRM, endeavour to provide rapid response service and on-going PM calls. Heidelberg re-sells CTP plates for its hardware also. SCreen is closer than ever to Fujifilm. If a supplier sees its investment in customer support scuttled by cheaper plates – what level of support will they be inclined, or be able, to provide versus a loyal customer?
    To summarise, plate supply (digital anyway) is all about a good relationship with the printer, good deals on the hardware linked to plate supply and a top-shelf service contract with the printer’s continuity of production in mind. It’s not simply about cheaper plates from China or anywhere else.

  2. George Alexander

    Andy, you make some excellent points. From my perspective the two key questions you raise are:
    1. Will Chinese plate vendors be able to sells plates in spite of bundling arrangements by CTP vendors?
    2. Where will technical support come from?

    It is fairly easy to answer the first question. Most of the world’s printers still use UV-sensitive plates exposed in a vacuum frame. Even in the US, there is still a significant volume of this, in spite of the CTP vendors’ best efforts. Furthermore, there are many CTP units being sold by vendors that don’t make plates (like ECRM, Basys, Lüscher, Escher-Grad, and so on). Both of these situations provide the Chinese with an opportunity for plate sales, as do the expirations of existing bundling agreements. As an example, Donnelley’s new plant in Poland is using a Lüscher CTP system and Chinese plates. So I conclude that bundling will slow, but not prevent, Chinese plate sales.

    The second question, technical support, is tougher. Most Chinese plate manufacturers are not in a position to set up a worldwide network for local tech support. My best guess is that some of the larger distributors will end up doing this (as has occurred in at least one case in Europe). This could also become an opportunity for third-party technical consultants. Time will tell.

    In the end, the economics are so compelling that coming up with a solution to these problems, whatever form it takes and almost regardless of its cost, will be very profitable. To me, that means that it will inevitably happen.

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