ASTUTE ANALYTICA
Why a Leuco Dye Deficiency has affected the supply of thermal paper?
Leuco dyes have a color-emitting agent, a color-developing substance, and a medium (or solvent), and all of these components work together to create their color. Commonly used chromogenic chemicals include acid white clay, bisphenol A, a green pigment, thermosensitive green and crystalline violet lactone, etc. It operates as an electron donor in the reaction.
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Increasing the usage of leuco dye-based thermochromic inks, especially in the packaging sector where they provide customers with a distinctive and alluring experience. Thus, it is anticipated to boost the market growth. In addition, according to a research report by Astute Analytica, the Global Leuco Dye Market is likely to grow at a compound annual growth rate (CAGR) of 6.7% over the projection period from 2023 to 2031.
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Thermal paper industry was hard hit by its heavy dependence on leuco dye
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A fundamental and essential ingredient in the creation of thermal paper items is leuco dye. Thermal paper is widely used in a wide variety of applications, including barcoding, retail receipts and ATMs, casino and gaming facility printing, parking violations and citations, shipping labels, and even airline tickets.
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The manufacturing of dye and other necessary raw ingredients for generating thermal paper entered a race to the lowest. In addition, the enormous demand for thermal paper brought on by such a broad range of uses. Producers sought the lowest price feasible to accommodate the size. As a result, practically all leuco dye manufacturing worldwide ended up in China, where manufacturers managed to beat the competition and essentially push it out of business.
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The resulting leuco dye scarcity put a strain on the global thermal paper supply chain. It leads to lost and late orders, increased expenses, and even the insolvency of businesses that depend on the dye for production. Additionally, it has finally led to higher thermal paper prices for Canadian consumers.
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40 percent of China's factories were closed by the government
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The Chinese government started enforcing environmental rules more actively. This strategy's primary goal was to cut emissions and take control of the nation's infamous air pollution issue. To achieve this, the nation set a target to lower its harmful fine particulate matter concentration from 47 micrograms per cubic meter to 35 micrograms by the year 2035.
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The outcome was a massive crackdown that was unprecedented. Due to their emissions, approximately 80,000 factories have received penalties and criminal charges, and in certain cases, even jail time for the plant owners. The outcome was a massive crackdown that was unprecedented. Due to their emissions, approximately 80,000 factories have received penalties and criminal charges, and in certain cases, even jail time for the leuco dye factory owners.
Leuco dye production was reduced by 80% due to the closure of industries
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The Chinese company Chemicals, which produced the majority of the world's leuco dye. It was not exempt from the government's regulations on emissions. As a result, dye prices increased by 500% due to the closure of the Chinese company. Many other dye makers, stopped an estimated 80% of global output.
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Original Source
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