A severe shortage of one-side coated boards, widely used by greeting card publishers, and soaring costs are causing havoc to many publishers, printers and board suppliers.
As Tony Lorriman, managing director of Loxleys, summed up: “There is a global shortage of one-side coated board which has led to insufficient volume to satisfy global demand, significantly higher prices and much longer lead times. There is a distinct lack of choice and the ability to spot buy from merchant stock at short notice no longer exists as UK merchants are out of stock and cannot replenish.”
And it is a problem that he does not think will go away anytime soon. “I am told that the current issues could remain for the rest of 2022,” added Tony.
Concurring that there will not be a quick fix Mike Lammas, managing director of Herbert Walkers, said: “I would love to have a crystal ball to be able to say when this problem will settle down but, unfortunately, I don’t and I cannot yet see the light at the end of the tunnel.
“There has been a perfect storm of massive demand driven by the desire to replace plastics in packaging and the huge increases in costs of freight which have not settled down since the onset of the pandemic.”
Sharing his view Adam Short, managing director of The Imaging Centre which prints for well over 500 publishers via its IC Simplicity system, said: “It is very serious. Every month seems to bring a new problem on the supply front. First it was the shortage of envelopes, then cardboard, then specialist boards and now single-sided board. And on top of that board prices have increased 10-25% since last October with further rises being mooted. It is really bad and is only going to get worse.”
Adam reveals the situation has necessitated a “fundamental” change its buying strategy. “The Imaging Centre has always promoted ordering on demand, something we have mirrored with our stock purchasing which up to now has been possible. However, to enable our customers to proceed with this ethos, we have made the decision to move to stock ordering, for the past three months and the next three months we will be building our stock levels on all fronts in order to be able to continue to provide a consistent service to our greeting card publishers,” Adam told PG Buzz.
The Imaging Centre recently wrote to all of its greeting card publisher customers informing them that Invercote 300gsm, one of its most popular boards used on over 50% of the printer’s orders, is not going to be available in the UK until next month (March) and, even then, bulk ordering of this particular board would continue to be problematic until possibly 2023. Fortunately, The Imaging Centre has managed to secure replacement board from Fedrigoni (Symbol Eco 50, made from 50% recycled material).
Giving some background as to how the general board shortage has evolved, Ian Braithwaite, commercial manager of Fedrigoni UK, told PG Buzz: “With us all spending more time at home these past two years, it has greatly influenced the rise of e-commerce. Demand for packaging – particularly transit packaging – has rocketed. One of the knock-on effects of shortages in cartonboard is users of these grades have been forced to upgrade to the next, typically better, alternative. These shortages have escalated up the supply chain to the solid bleached sulphate (SBS) boards, used in the single-side coated format by many greeting card publishers.”
While Fedrigoni has been able to reorganise its production away from standard woodfree coated paper to ensure more single-sided coated boards are available to its customers, the lead times have been extended by two to three weeks.
Chris Sandwell, sales and marketing director of independent board supplier EBB says demand is at unprecedented levels with paper manufacturers able to “sell the material twice over” which means that ultimately you have to “pay the price the manufacturer wants and accept the terms,” and, even then, there is no guarantee of availability.
His advice is that with everything still so volatile don’t fix pricing too far in advance. “We don’t have visibility on cost for more than the current quarter” and does not see the situation improving until next year.
While printer Windles says that it has been able to cope with the one-side coated board shortages, extended lead times and rising costs have had to be confronted.
“We have had to stay one step ahead and have relied on accurate forecasting from our customers to ensure that we have continuous supply. Historical data of ordering patterns no longer reflect how people are placing business today and therefore we have had to estimate possible growth in order to cover for every eventuality. Lead times on some materials extend beyond 12 weeks and therefore this has had to be carefully managed,” commented Michelle Mills, Windles’ business development and marketing manager.
As Andrea Norcott, sales director of Windles, added: “It is with great disappointment that we have recently been forced to announce board increases of such significance to our valued customer base. The pandemic has transformed the way in which we trade with our suppliers. Huge reduction in supply of material from Europe and overseas coupled with pressures on the packaging market to be more sustainable and go plastic free has meant that there is instability. Unhealthy profiteering as a result of the current economic climate has placed us in a force majeure scenario. Windles’ primary focus has had to be to ensure that we have continuous supply of material for Production to be uninterrupted and service to our customer to be maintained at the high levels that we pride ourselves on. “
The commonly-held belief among all the industry’s dedicated printers is the heightened need for communication with publishers.
John Skeet, managing director of Skeet Print, summed up: “As an industry it has never been more challenging on so many fronts, so please work with us. My advice at the present time would be to keep printers advised of your future plans and requirements where possible, as an industry we can never have enough information of what is going to be required. Please forward plan and involve your printer if you don’t want them to let you down. Treat your printer as a member of your production team as we often have solutions that you wouldn’t think of.”
On the matter of the further price increases in the pipeline, John believes: “There comes a point where, as an industry we have to start fighting these increases, this includes the paper merchants who, in my experience, need to take a tougher line and start to seek alternative supplies. Flexibility and teamwork are going to be vital over the next few weeks. Good luck everyone!”
Top: The global shortage has seen the cost of one-side coated board soar higher than any paper aeroplane.