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Industry Market Update

Industry Market Update

Updated: September 2018

As most should know, Trumbull Printing has taken a pro-active and instrumental stance in trying to combat the ongoing volatility in the newsprint and overall paper market. Severe supply and demand imbalances (paper shortages) for the entire newsprint paper market in North America, coupled with the tariffs that were threatened last year then instituted this year caused paper prices to skyrocket to unprecedented, historical high-levels. This contributed to some commercial printers, newspapers, and publishers being forced to cease or reduce operations.
The ITC (International Trade Commission) recently removed the U.S. duties on imports of Canadian paper. This is big news but we are not completely certain what this will do for the short term, especially in terms of pricing? 

Higher prices and supply shortages remain as all paper markets remain extremely tight and continue to trend in upward price cycles. The supply and demand imbalances have continued to escalate and there still appears to be no end in sight. This will likely intensify as the busy fall & holiday printing seasons approach. Due to the uncertainty with the entire paper situation we must remain patient and see what this does for the long-term. 

As a reminder, the vast majority of U.S. consumption is provided by Canadian mills. Therefore U.S. printers and publishers rely heavily on the Canadian paper supply chain.  The U.S. newsprint paper manufacturers do not have the capacity to meet the U.S. demand and play a much smaller role in the U.S. paper economy.

Good News…a major Canadian producer whom discontinued selling/shipping newsprint into the U.S. earlier this year, due to the tariffs has re-opened business only with select U.S. firms. Trumbull Printing is one of them.

Paper Grade Price Increase Time-Line

  • October 2018: Offset
  • September 2018: Offset
  • August 2018: Hi-brite
  • August 2018: Offset
  • July 2018: Newsprint
  • July 2018: Hi-brite
  • June 2018: Newsprint
  • June 2018: Hi-brite (announced)
  • June 2018: Offset
  • May 2018: Newsprint
  • May 2018: Hi-brite
  • May 2018: Offset
  • Apr 2018: Newsprint
  • Mar 2018: Newsprint
  • Mar 2018: Hi-brite
  • Mar 2018: Offset
  • Feb 2018: Hi-brite
  • Feb 2018: Offset
  • Jan 2018: Newsprint
  • Dec 2017: Newsprint
  • Oct 2017: Newsprint
  • Oct 2017: Hi-brite
  • Oct 2017: Offset

Key Market Drivers

  • Paper: Wood pulp prices again increased $20/ton in August, or 15% year to date in 2018. Up 45% since the 1st quarter of 2016.
  • Transportation: National transportation, trucking and labor shortages continue to pose challenges throughout the supply chain of our entire industry. Transportation costs continue to escalate as some mills are charging delivery surcharges.
  • USPS: The Postal Regulatory Commission is proposing a 40 percent hike in Periodical (and possibly other mail classifications) postal rates over the next five years. In most cases for those utilizing USPS as a distribution method…the mailing, postage and associated costs are a publisher’s 1st, 2nd or 3rd highest operating expense.
  • Ink: A variety of world-wide raw material trends have led to decreased availability and increased cost of many key components used to manufacture printing inks resulting in higher ink prices.
  • Aluminum: Tariffs and escalating costs of raw aluminum has resulted in increased printing plate prices.
  • US Dollar currency exchange: The euro is currently at 1.16 and trending upward. The Canadian dollar is currently at 0.76 and trending down. The euro is down 8% from its peak in February of this year.