The reduced purchasing power of the euro has led to the price hike, according to the European Printing Inks Association (EuPIA).
Another reason given by the association for the rising costs is changes to the exchange rate, despite the low price of oil. EuPIA Executive Manager Martin Kanert said that “many ink formations have only a limited direct relationship to oil, whereas increasingly high prices are now being paid for other raw materials”.
Examples of these non-oil based materials include gum rosin and nitrocellulose, which have gone up in price in US dollars, while the cost in euros of vegetable oils has seen an even more pronounced increase.
Pigment production has been similarly unaffected by low oil prices, according to Kanert. He stated: “The direct crude oil cost component in pigments is relatively low, with speciality chemicals, environmental costs, increasing labour costs in China and India and unfavourable currency exchange rates as key cost drivers.”
A similar trend is emerging in the titanium dioxide market, as the trade becomes smaller due to suppliers consolidating and taking out capacity. Yet Kanert also said the net result of this surge in prices is that “compensation for this squeeze on margins is becoming increasingly difficult for the European ink manufacturers”.
The findings match predictions for rising ink prices made in September 2014, when it was reported that pressure from China was causing gum rosin prices to rise. Rises in pigment prices were then attributed to stringent environmental regulations in major producer nations China and India.