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A convergence of adverse global forces mean printers, packagers and wide format operations will be slugged with higher costs for their paper, board and media from 1 July, with prices set to rise across the board.

Paper: prices rising on 1 July

Spicers will raise prices by six per cent across all grades, while Ball & Doggett is introducing a range of increases across its grades. The latest increases come after paper prices to ANZ printers were raised by between 3-8 per cent in March.

The July increases come as merchants are having to pay more for their stock at source, with pulp prices to the mill up by 35 per cent this year, and mills themselves seeing their energy costs soaring. In addiiton, and like everyone, merchants are facing spiralling increases in shipping rates, currently up to five times normal rates. Wide format media and packaging films are also being impacted by skyrocketing resin prices.

Dale O'Neill, general manager, Print and Packaging, at Spicers Australia, said “While currency has been kind to us over the last six months, significant increases now in pulp, mill energy costs, international shipping rates, vessel space and local container clearance costs have significantly impacted our supplier channels.

“Covid-19, while not having a big impact locally, is still causing huge problems for our suppliers internationally, which is impacting Spicers buying rates.”

Tony Bertrand, marketing manager at Ball & Doggett said: “It is unfortunate, but Australia is not shielded from the global dynamics. Anyone who has tried to buy a car recently knows the impact of the current shipping situation, with prices and lead times blowing out.”

Under pressure: shipping costs
Under pressure: shipping costs

Tim Woods, editor at paper industry bible Pulp & Paper Edge, predicted July price rises for printing products brought into ANZ as certain, citing Stora Enso taking out 1.3 million tonnes of production, a third of its capacity, as an added driver to price pressure. Woods said that taking that much product out of the market, combined with sky-high freight costs, increased pulp costs, and growing demand from China would leave ANZ paper importers facing "inevitable" rises.

Pulp manufacturers are racing to find new markets for their product, as Covid decimated demand for commercial and newsprint grades, and looking at diverting product from paper mills to markets including textiles, hygiene and packaging.

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