Price Increase Throughout the Ink Industry

Due to further cost increases in key ingredients necessary for printing inks, ink manufacturers have announced numerous price increases of their own during the past two months. These include the following:

• Sun Chemical Europe announced that due to unrelenting raw material cost increases and supply shortages, prices of its products in the publications market increased by the following, effective July 1, 2011:

• €0.25/kg for all heatset inks.

• €0.20/kg for all coldset inks (black and color).

• 6% for all sheetfed conventional inks – excluding colors containing V23, which will increase by 20%.

• 6% for all sheetfed founts.

Raw materials used to manufacture publication inks continue to be subject to extreme shortages due to increased demand, destocking within the industry, plant closures and capacity reduction.

This, together with production and environmental restrictions, is having a serious impact on availability and costs of materials such as carbon black, gum rosin, vegetable oils and various pigments, which are key cost drivers for publication inks. As another major cost driver, the price of oil has increased by more than 60% since the start of 2010 alone.

Further increases have become unavoidable due to an increasingly stressful supply situation.

“We continue to work very hard to control the costs of our publication inks, but we are not able to completely offset the drastic raw material price increases and global supply chain instability we’ve seen in the past year, and this has necessitated another price increase,” said Felipe Mellado, chief marketing officer of Sun Chemical. “We’re working closely with our customers to help them get the most out of their inks, and to develop new value oriented products and services that can help them grow their business despite this challenging marketplace.”

• Unprecedented shortages and ongoing cost increases of the raw materials needed to manufacture all packaging inks have necessitated Sun Chemical to announce a price increase effective July 1, 2011, for its packaging ink products in Europe by the following:

• 8% for all water-based inks and varnishes.

• 20% for all water-based and solvent-based inks containing Violet 23.

• 10% for all white water-based inks.

• 8% for all solvent-based color inks.

• 12% for all solvent-based white inks and NC varnishes.

• 8% for all UV, sheetfed and narrow web inks and UV coatings.

With no stability in the cost, or the supply, of key raw materials used in the manufacture of these inks, Sun Chemical has taken the decision to adjust its prices in order to remain competitive in this segment.

“Materials such as nitrocellulose, titanium dioxide and acrylic acid continue to suffer from a shortage in availability due to increased demand and reduced capacity,” said Felipe Mellado, Sun Chemical’s chief marketing officer. “This unrelenting situation unfortunately necessitates continuous price reviews in order to ensure profitability and efficiency. We continue to work closely with our supply chain partners to look at ways to control costs.”

• Central Ink has announced price increases effective July 1, 2011. Continuous increases in raw materials are making this price announcement necessary. All product lines will be raised 8 to 10%. Central Ink appreciates its customers’ understanding and continued loyalty during these difficult times.

• Due to ongoing, unprecedented raw material cost increases experienced throughout the ink industry, Siegwerk is forced to implement price increases on its solvent-based and water-based inks for its wide web customer base.

Effective July 1, 2011, solvent and water-based inks and coatings were increased by 15%, excluding products containing Violet 23, which will be addressed on a customer-specific basis.

Violet 23 pigments have increased more than 60% in the last six months. Siegwerk vows to work with its customers on alternative offerings to meet their business needs while minimizing cost pressures.

“Siegwerk has taken every measure possible to minimize increases in raw material costs or to compensate these increases by increasing efficiencies,” stated Jim Ross, president Siegwerk USA and Canada. While Siegwerk does not foresee a reversal of the raw material trends in the coming months, moving to quarterly reviews of pricing will ensure that Siegwerk can provide its customers with fair prices that more accurately reflect market conditions.

“Siegwerk continues to search for efficiencies throughout its supply chain and will work with its customers to help maximize the value of Siegwerk’s high quality inks,” Mr. Ross continued. “Siegwerk greatly appreciates its customers’ understanding during these unprecedented times and remains committed to providing the best possible value-added products and services to help its customers continue to grow their own business.”