Pricing Volatility, Availability of Raw Materials Remain Critical Concerns

By David Savastano, Ink World Editor | 09.19.05

For more than a year, ink manufacturers have watched closely as pricing of key raw materials have skyrocketed, and availability of certain critical ingredients has become a major issue.

That situation has not changed. Crude oil and natural gas, the key building blocks for the feedstocks that are so essential to ink formulators, have continued to dramatically increase in price. Last year, ink manufacturers were lamenting a barrel of crude oil reaching $45. Now, one year later, crude oil is going for more than $65 a barrel. As a result, there is tremendous pressure on essential ingredients for formulating ink, particularly on oil derivatives.

Meanwhile, availability of many key ingredients, most notably acrylic acid and pigment intermediates, has become more challenging. Simply put, demand for these products has become greater that present capacity can provide, and ink manufacturers are having to pay a higher price to get the products they need. While suppliers are trying to work with ink manufacturers, they are limited in what they can do.

For the ink industry, about the only good news that has come from these price increases is that ink manufacturers have finally realized the absolute necessity for raising their own prices, and are successfully educating their customers about why these prices are on the rise. In some cases, major ink manufacturers have been forced to increase prices more than once to try to recoup some of the losses they are taking.

It looks like many of these price increases are here to stay, with some industry leaders expecting even higher crude oil prices in the coming months. Knowing this, perhaps ink manufacturers will continue to become more conscious of their pricing structure, and will work toward receiving the margins the industry deserves.


On a personal note, I am honored to announce that Ink World welcomes Phil Lambert, president and CEO of Wikoff Color Corporation, to our Editorial Advisory Board. Ink World relies heavily for advice from our board, the members of which have an incredible array of experience and wisdom. A 32-year leader in the ink industry, Mr. Lambert offers tremendous expertise he can share with us. With his help, Ink World will continue to be able to provide our readers with the most comprehensive information about the industry in these dramatically changing times.
Ink World Editor