Update on the printing market
For the past two years, the printing market has been experiencing significant fluctuations caused by the global pandemic. In addition, since the summer of 2021, the context has deteriorated due to serious difficulties in the supply of raw materials correlated with a sharp increase in prices, partly due to a surge in energy prices.
According to Pap’Argus, the magazine for the paper and board markets, between the summer of 2020 and the summer of 2021, the price of pulp increased by 60%, from $810 to $1,310 per ton. Since then, the price of a ton of paper has risen again and prices do not appear to be stabilizing.
Aluminum prices are also soaring, from $1200 per ton in March 2020 to $2600 per ton in March 2022. Prices for some metals have risen so much in recent days that the London and Shanghai stock exchanges have decided to suspend trading in nickel, which has risen above $100,000 per ton, the first time this has happened in 145 years. Although not as well known in the printing process, aluminum is a key element in offset printing because this printing technique requires the use of aluminum plates.
The printing market has been impacted for two years now
The price increase is explained by many factors since the beginning of the health crisis. The factors that have had a strong impact for two years now are, on the one hand, the decrease in production during the first months of the crisis and, on the other hand, the conversion of some factories from paper production to cardboard production to meet the high demand in this industry due to the growth of e-commerce. Port congestion caused by sanitary restrictions had led to numerous loading delays. The recovery in global trade had increased the journey to Europe from $1,600 in 2020 to $10,000 by July 2021.
Printing market impacted by humanitarian crisis
Recently, the humanitarian crisis has brought its share of concerns to the markets, and, energy prices, which had already risen by the end of 2021, have surged due to possible embargoes on Russia. The price of a barrel of oil rose from 67 dollars a barrel in December 2021 to 127 dollars in March 2022. That is an increase of 90% in only 3 months. The price of gas has increased by 135% in cumulative increase since 2005 and without the freeze of rates announced by Jean Castex in October 2021, the increase would have been 395%. Concerning electricity, the increase, which usually averages 2% per year, is this year 4%. All these increases also have an impact on the production prices of paper, aluminum, but also ink and other raw materials that a printing company needs to produce.
As a reminder, Russia is the 7th largest exporter of forest products in the world and, according to the Wood Resources Quaterly, its exports reached $12 billion in 2021 including $2 billion of paper, and, they increased by 11% between 2017 and 2021. This activity is now endangered and 60% of this production is usually destined for Europe.
In addition to the difficulty of paper supply and this shortage, a new market is entering. Indeed, since January 1, 2022, the AGEC law prohibits the use of plastic packaging for the shipment of press publications and advertising, addressed or not. One of the solutions retained was therefore to put the documents on paper. But in an already saturated market, demand is extremely tight, making supply even more complex.
In order to propose alternative solutions to plastic, many solutions are being developed and will be proposed, such as enveloping or open routing, to name but two.
Solutions to print books, catalogs and magazines in this context
Several solutions exist in order to be able to print and route your works, whether for the publishing market or for the press.
First of all, for the publishing, the solution of the book of one. This service proposed by Corlet Imprimeur 360°, thanks to its Rapidbook platform, allows you to realize yourself an estimate on line then to validate it before placing the order of your work. As soon as the order is finalized with the deposit of the file in conformity and ready to be printed, we deliver you within 5 working days on average. This printing solution is possible from one copy and allows you to reduce your stocks while remaining competitive in terms of price, without impacting the quality of your product.
For quantities up to a thousand copies, digital printing on the VpiX recently acquired by our Group will allow you to obtain a printed product as qualitative as offset printing, while maintaining lower costs. Indeed, the revolutionary technology of this press significantly reduces paper waste, which is a considerable advantage in these times of paper supply difficulties.
As we explained to you back in November, we are not in a situation where we cannot produce. In fact, we simply have to be flexible in our choice of paper in order to compensate for possible shortages of certain references. Some categories of paper have longer supply times than others and we will have to adapt to their availability, especially in the case of an urgent order. This situation is restrictive and simply requires that you plan your orders over a longer period of time when possible.
Alternative solutions are always possible, our sales representatives will be able to guide you during the implementation of your project.