Weak Pound and Raw Material Costs Push UK Label Paper Prices Up More Than 21% Since 2009
Since 2009, label paper prices in the UK have moved steadily higher, with an average increase exceeding 21%. Behind these increases, major label suppliers are looking to offset rising raw material costs while easing the exchange-rate pressure caused by a weak pound.
Label materials from Avery Dennison's UK roll materials division have risen by 21% since January, partly offsetting the effects of currency movements. A staff member at Avery Europe said Avery's label prices increased 6% in January and then by another 15% in March, with the overall increases broadly matching exchange-rate shifts. The staff member stressed that the pound-to-euro exchange rate has a strong impact on UK label paper prices, because label paper sold in the UK mainly comes from continental Europe. He added that the 2009 increases followed two rounds of price adjustments in 2008, all intended to recover losses caused by exchange-rate changes.
In 2008, UPM Raflatac also implemented price increases, with particularly noticeable rises for products tied to petroleum-derived raw materials. In 2009, however, the company has not yet announced further price hikes. Tapio Kolunsarka, vice president of UPM Raflatac Europe, attributed the main drivers of the increases to the weak pound and soaring raw material costs.
Faced with the rapid rise in label paper prices, some industry professionals argue that the increases are too steep and too sudden, and could force some label printing companies out of business. Even companies that narrowly avoid bankruptcy are likely to pass the higher costs from label paper price rises on to downstream customers, ultimately pushing up retail prices.
——This article is reprinted from China Packaging Network (pack.cn), original link: http://news.pack.cn/show-362296.html
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