Paper prices on the up again
Tuesday, October 24, 2017
A number of paper merchants have announced price increases for the third time this year.
In correspondence seen by PrintWeek, Feltham-based merchant Elliott Baxter (EBB) said that following a negotiation period with its suppliers it would be initiating price increases of between 6% and 9% on coated sheets and reels and specialist papers from 4 December.
The correspondence said that suppliers had notified the company of a need to raise prices in order to maintain sustainable supply to the UK and as a direct consequence prices had to go up. No one from EBB was available for further comment.
Premier Paper group marketing director David Jones confirmed that the company had received notification of a price increase from certain paper mills, stating that they had cited upward pressures on costs.
Jones said: “With paper mills you’ve not just got currency pressures [with the pound] but also the euro and the dollar so chemicals become more expensive, pulp is more expensive and generally there’s always upward pressures on costs from the mills, they’re having to increase prices to make a sustainable return and that’s what they’re citing in their letters.”
Antalis channel director for print James Jarvis also confirmed prices for uncoated papers and envelopes had risen on 2 October by between 6% and 10%, citing the incident at Stora Enso’s Veitsiluoto mill in Finland as problematic, but said it had been a difficult year due to the instability of the rises. The Stora mill will not be up-and-running again until the end of the year and Jarvis said it is now looking likely that there will also be a coated paper increase around Christmas time.
“It’s not quite as straightforward as a standard price rise,” said Jarvis.
“Part of the problem is because of the different products’ makeup the suppliers pass increases through at different times, so not everything goes up at the same time, which makes it complicated for merchants to handle and sometimes more confusing for our customer – the printers – and also for end users to understand. So unlike a once-a-year price increase it’s based on their input costs.
“The uncoated increase we’ve just seen is actually quite a shortage, we’re having to work our supply chain hard to get the volumes that our customers are asking for."
A source from the UK paper industry told PrintWeek that there had been continuous across-the-board price rises on all materials this year and that once again they had gone up in the last couple of weeks.
Paper makers Lecta and The Navigator Company have also announced or implemented increases, with Lecta upping thermal and carbonless paper prices effective 2 January 2018. Lecta stated that the price increase for both product ranges will be from 8% to 10% depending on format and country and that it was essential in order to offset the continuous increase in manufacturing and distribution costs. It was unable to give further information on the specific details regarding the UK market at the time of writing.
On top of an October price increase of between 4% and 7% on dispatches of its uncoated woodfree paper, Portugal-headquartered The Navigator Company announced increases in the UK of 6% to 8% from 1 January 2018, indicating the move as a further reflection of the “continued pressure on the industry’s cost structure”, heightened by a record level of incoming orders and extended lead times.
German paper manufacturer Zanders has also indicated rises of 5% to 8% on all grades from 1 January 2018, citing increases in raw material costs.
Uncoated paper prices initially went up by between 5% and 7% in May, following an across-the-board increase at the start of the year.
Jarvis added that the merchants now need to have improved dialogue with printers in order that the rises get passed on effectively to the end user.
"Paper is a big chunk of a printers' overall costs and if it goes up they've got to pass it on otherwise it severely affects their profitability," he said.