Ahlstrom's LabelPack division, one of Europe's main producers of specialty papers for flexible packaging and labelling, has announced a price increase of €100/tonne for all paper grades.
The company said that the manufacturing costs of specialty papers for flexible packaging, labelling and self-adhesive laminates have increased dramatically over recent months, and the signs are there are more to come. The cost increase is a combination of rapidly rising prices for energy, chemicals and pulp. Increases in transport costs are also to be expected. The industry itself is said to be facing a total increase in excess of €100 per tonne.
"For all these reasons we are forced to increase the prices of all our paper grades by the same amount," explained Diego Borello, president of Ahlstrom's LabelPack division. "But, in order to make it easier for our customers to absorb and to pass on the increase, it will be made in two steps. The prices for all shipments from May 1, 2003 onwards will go up by €50, followed by a similar increase on June 1, 2003".
Across the industry energy prices have risen considerably in recent months; in some countries by up to 35 per cent. The costs of chemicals have risen by close to 20 per cent and the price increase for cellulose pulp is even more dramatic, the company added. Pulp manufacturers worldwide recently announced the third price increase in 2003 and the near certainty of more is to come.
Ahlstrom has informed all its customers in writing about the price move and sales personnel worldwide will visit each of the customers in the days ahead to discuss the details.
As many of the Ahlstrom's customers are involved in the packaging of food and beverage products that industry will be on tenterhooks to see just how much will be affected. The price increase is fairly substantial and will probably have a significant impact on the overall cost of the product. The next step will be to see whether or not any increase will then be passed on to the consumer.
Ahlstrom's LabelPack division produces specialty papers for flexible packaging, for the self-adhesive industry and for wet-glue labelling - applications that are widely used in the food and beverage industry. The division employs more than 1300 people and operates six production units throughout Europe. In 2002, the division had net sales of approximately €512 million.