Newsprint prices in the UK decline on poor demand
Producers of publication paper initially entered the mid-year price negotiations in 2012 looking to achieve hikes, but in the end, they had to accept considerable reductions due to the weak euro and poor demand.
By mid-July pretty much all of the newsprint contracts for the second half of the year in the UK had been signed. Although producers urgently wanted increases, they were unable to implement them. Due the continued decline in demand and the stronger British pound, prices came under pressure and were lowered. The price reductions were even greater than those seen on the Continental European markets; prices in the UK (in euro terms) have come closer to prices in mainland Europe.
Prices for improved grades were also reduced significantly even though this market is considered to be firmer than that of the standard grades.
The results of these price negotiations reflect the current market situation, which remains shaped by declining paper consumption. In addition, there are seasonal factors: events that should increase consumption, such as the upcoming Olympic Games in London, only have a small effect on paper consumption in the British press sector, and will only partially offset the usual summer-related demand weakness.
⇒ This article in an excerpt from EUWID's monthly report on the UK paper market. The EUWID Price Watch UK for July will be published in EUWID Pulp and Paper no. 30 on 25 July.
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