Big increases in paper prices on the way
Wednesday, April 14, 2021
A raft of papermakers have announced upcoming price increases of between 6% and 15%.
Italy-headquartered Burgo Group was first to make its notification. It is increasing prices in Europe by up to 15% on all its graphic papers, from the beginning of June.
“As a consequence of the ongoing production cost increases – particularly pulp, energy and chemicals – Burgo Group will increase prices up to 10% for woodfree grades and up to 15% for coated mechanical grades effective deliveries from 1 June 2021,” the company stated.
It said the increases would be applied on all contractual and non-contractual business.
Burgo UK managing director Alberto Bortoluzzi told Printweek: “In every market in Europe and overseas we will start local discussions, but this [increase] is our goal.
“We are going through a perfect storm. There is an increase in every type of raw material: energy, chemical components, transport costs, and especially supplies coming from China and Asia in general. It’s very tough and very difficult. The pressure on costs is extremely important.”
The Navigator Company has announced price increases of between 6% and 9%, effective from 10 May.
“This decision was taken following not only further worldwide cost increases in pulp, chemicals and logistics, with structural effects in the profitability of the industry in Europe and across the globe, but also a robust demand for Navigator’s products and brands during late 2020 and the first months of 2021,” the Portuguese papermaker stated.
“The company will continue to tightly monitor the market evolution of key business drivers and act, if required, to correct potential future imbalances between its products prices, raw materials and logistics costs…. The Company will continue working to reinforce its partnerships with customers and to appreciate the support provided.”
Spain headquartered Lecta has also opted for a June increase. It has announced a second price increase “due to the current economic environment and the continued significant increase in raw material, manufacturing and logistics costs”.
It plans a price rise of 8% on its two-side coated woodfree products, and on uncoated woodfree grades in sheets and reels.
This morning (14 April) Sappi Europe announced a Europe-wide price increase on all of its woodfree coated and woodfree uncoated paper grades of 7%- 10%, effective from 1 June, and confirmed that this was “in addition to the previously announced and implemented increases”.
The news comes just over a month after Sappi announced price rises for its packaging and speciality grades, which became effective at the beginning of April.
Sappi also warned that further increases were likely: “Sharply rising input costs in raw materials and freight rates due to global logistic constraints make the increase unavoidable and will likely be followed by subsequent increases as the trend continues.”
Its sales team will be in contact with customers to discuss further details, and to “support the implementation, taking into account individual existing agreements”.
A number of speciality makers are also understood to have increased their prices, as well.
One paper industry source commented: “The feedback I’m getting from printers is that this is a particularly bad time to say the least. But ironically, when the market is in a weak state, which it is at the moment, people run around with contract pricing that means some printers can ultimately end up paying less. It’s the smaller firms without much buying power that are going to take the pain.”
Last month Feldmuehle and Mitsubishi HiTec Paper outlined impending price increases on various products.
Ink makers and plate manufacturers have been among other industry suppliers to have announced recent price increases due to rising raw material and logistics costs.