Raw material challenges lead Flint Group CPS to increase prices of offset inks
In this final quarter of 2019, the printing ink industry has continued to face raw material shortages, challenging supply chain conditions, and new disruptions.
Michael Podd, Flint CPS Chief Procurement Officer and Senior Vice President Global Sales, identifies the following areas of major challenge:
1. The Global Carbon Industry. New global environmental legislation being introduced by the International Maritime Organisation (IMO) in 2020 regarding sulphur content in marine fuel oil MARPOL will significantly and adversely impact carbon production going forward. The low sulphur content oils are the primary raw material feed stocks used by the carbon manufacturers to produce carbon black supplied into the printing industry. As a result of the new MARPOL legislation these low sulphur oil feedstocks are now being sourced by the global marine fuel industry, significantly increasing the demand and price of these raw material feedstocks. This has resulted in price increases from all of our carbon suppliers in the range of 20% to 30%.
2. India and China are adopting stricter environmental regulations on pigments and base chemicals manufacturing which is leading to factory closures which is reducing quantities available and therefore increasing costs.
3. Increased freight costs. “The trucking industry has faced driver shortages for years,” notes Mr. Podd. “The situation has worsened over time, and is exacerbated now by equipment shortages and increased fuel costs. All modes of transportation have increased in cost.”
As a result, Flint Group will announce price increases on offset inks in Europe. Increase amounts vary depending on product lines and technologies based on the raw materials make-up. The specific increases will be communicated by our sales leadership teams.
“Flint Group will work closely with our customers to manage through this price increase and keep them informed,” says Mr. Podd, “And our preferred status with suppliers helps customers rest assured that Flint Group is best positioned to meet their ink orders without sacrificing quality.”