Has paper sourcing changed for the better in 2021?
From operating rates causing price increases, the impact on capacity, to the ultimate effects on your purchasing decisions, the paper supply chain has been in a very difficult place for some time.
What we’ve seen is that organizations go through several stages of awareness. By now, many have gotten past the shock of the events that caused so much disruption. And while it’s possible to be in denial of it, the reality of rising prices has made a lot of people frustrated.
If you’re ready to get to making decisions and achieving integrations, you’ll want to take stock of what’s still a problem and what’s starting to change.
Container & freight costs
One of the biggest impacts came from increases in container costs—they’re causing serious price hikes. Similarly, truck freight has continued to rise.
Another impact comes from consumer spending. Even as pandemic protocols loosen, people continue to spend on goods at a high rate. As you know, this means packaging and transportation are still in high demand, again fueling sustained rises in prices.
This might even get compounded. As workers return to the office and students return to school, this could lead to an even higher demand for products like away from home tissue, office supplies, and other materials. The demand for graphic papers has also been growing back incrementally after reaching lows during the pandemic.
With these factors continuing to put a crunch on supply amidst elevated demand, it’s clear that a sudden price drop isn’t coming soon. In fact, you can expect to continue to pay premiums in the near future.
This could be especially true around recycled products. Because of the reduction in traffic in offices and schools, today’s supply of recovered white paper is at record lows. As a result, recovered white paper is becoming harder to find and the costs to procure it are increasing rapidly.
So far, there has been a limited-to-no change in how much suppliers are charging for recycled content, but there’s reason to anticipate that changing. At the least, grades with recycled content are likely to become less available. They could then become significantly more expensive, or they could be rationalized out of the offerings.
Fortunately, there are things you can do now to help make smart sourcing decisions and reduce your paper supply chain frustrations. Read more about those here.
Veritiv Paper & Print
While there have been some major changes in the paper industry, we’re here to help you through it. To read more about print's new normal and how to handle current supply chain issues, check out our content hub.