International. Despite a 5% drop in the global RFID market in 2020 compared to 2019, due to the impact of Covid-19, the sector has recovered well in 2021. According to IDTechEx's research report, "RFID Forecasts, Players, and Opportunities 2022-2032," this sector is estimated to be valued at $11.6 billion in 2021, rising to $12.2 billion in 2022. This market comprises RFID tags, cards, keychains, and any other form factors as well as readers and software/services for passive and active RFID.
The report explains that Covid has had a detrimental influence on many aspects of our lives; however, Covid-19 also accelerates the digital transition. In the UHF sector, for example, IDTechEx has observed that the apparel retail business, the largest RFID application sector in terms of tag numbers, adopts RFID at a faster rate. According to IDTechEx, retail apparel alone will require more than 20 billion RFID tags by 2022, though there is still a way to go, as RFID will account for about 26 percent of the entire addressable clothing market in 2022.
Despite the success of the apparel retail industry, there are also many other industries that are gaining ground. Other retail sectors, in addition to apparel, such as footwear, cosmetics, fragrances, electronics and supply chain and logistics, as well as the food industry, such as Quick-Service-Restaurant, have also received solid interest and investment. In the HF sector, contactless card sales remain the strongest, driven primarily by contactless payment, transportation, and secure access apps, with 2.6 billion cards in demand in 2021.
IDTechEx predicts that this trend will continue in the short and medium term. In the animal labelling sector (such as pigs, lambs and pets) it remains important as it remains a legal obligation in many more regions, with 640 million labels to be used in this sector in 2021. According to IDTechEx "RFID Forecasts, Players and Opportunities 2022-2032", a total of 28.4 billion passive RFID tags will be sold in 2021, up from 23.8 billion in 2020, representing a double-digit growth rate.
Most of this expansion is due to passive UHF RFID tags. However, in 2021, sales of UHF tags (RAIN RFID) by value will be only 30% of HF tag sales (including NFC), due to the higher price of HF tags used for security (such as payments, access, etc.) versus cheaper, disposable UHF (RAIN) tags used to tag items.
Although the RFID industry continues to expand, there are still hurdles to overcome, particularly in certain markets. Chip shortages will be a problem in the short term. "We have started to see that chip shortages are causing supply to not meet demand, which translates into price increases. On the other hand, "Education" and "Standardization" will be the two most important topics to address to achieve the widespread adoption of RFID in the medium and long term. It is important to educate businesses about RFID capabilities (including its advantages and limitations) and how a company can implement RFID to improve its corporate efficiency. In terms of standardization, let's take the pharmaceutical industry and the food industry as an example, the huge market opportunities in these two industries arise in the "item-level" lag; however, this is unlikely to happen until the government's mandate is in place," the report says.
Source: IDTechEx.
