The cost and availability of crude oil is impacting on ink prices.
Ink manufacturers warn shrinking margins could result in price hikes.
PrintWeek reported that there could be an increase in ink prices on the horizon following widespread rumours and a statement from Flint Group highlighting price increases of raw materials, which triggered other ink manufacturers to confirm that they are also facing rising costs.
Among those confirming rising costs are Sun Chemical and Stehlin Hostag/Hubegroup, with UK Managing Director of Stehlin Hostag, David Ward, noting that “it’s three years since the last price rises and it was difficult to pass them on at the time […] we’ve absorbed a lot of raw material prices; the trend is clearly up and needs to be addressed”.
The article states that the raw materials affected by rising prices “span all the major components of inks including resins, solvents, intermediates and pigments”, with prices increasing due to the increasing cost of crude oil “caused by numerous geopolitical problems in addition to tighter environmental regulations and some shortages in supply”.
Commenting on the increasing prices, Jan Paul van der Velde, Senior Vice-President for Procurement at Flint Group, said: “Since mid-2013, unfortunately several key raw materials have increased in price […] this was indicated at the end of last year and in May of this year, and now we see that this trend has become significant […] some red and yellow pigment intermediates, which are components of inks for every application rose by 30 to 50 percent over the past several months, and there is no end in sight for these increases.”
Another raw material rising in price is gum rosin, which peaked in 2011 at $3,500 (€2,760) but since the second half of 2013 has been rising again “due to concerted efforts by the Chinese market to extract higher values for gum rosin”.
A further reason for the rise in price of pigments and pigment intermediates is “tighter environmental regulations” in China and India, where the majority are manufactured, which has led to price pressures and supply shortages. An increase in transportation costs “throughout the supply chain” has also been a factor.
The article notes that ink prices have actually fallen recently as ink manufacturers usually struggle to make price rises stick, but adds that “this time […] it might be different as the ink firms are taking steps to improve their efficiency and align capacity with demand”.
Ink manufacturers have not yet specified how much ink prices will rise by, with many stating that they will need to monitor and evaluate changing market conditions. However, printers are encouraged to “be prepared and go into partnership with [their] suppliers” to “minimise the pain”.