First announcements for price increases on the German coated fine paper market have been made. However, not everyone is convinced that the attempts will be successful.
After one manufacturer of coated woodfree paper announced a price increase of 5% as of 1 January 2013 for reels, another followed suit and proclaimed it was introducing mark-ups for its entire range of graphic paper products. No specific details were given about the size of the price adjustments, the supplier only said that those prices that were unsustainable would be raised. Other producers say they will watch this attempt very closely and take advantage of every opportunity. All paper makers complain of diminishing margins as a result of considerable costs increases for raw materials, energy and transport.
However, observers believe the market environment in Germany is not really suitable for price increases at this time. Buyers call these announcements "stabilisation measures”, adding that manufacturers’ credibility is damaged, or even destroyed, after a number of publicised price increases that did not materialise.
Instead, they expect that prices will continue to decline since a slight price erosion has been taking place for months and many special prices have been conceded. These were mainly attributed to the wholesalers and their fierce battle for market share. Buyers added that bonus payments would become more of a focus toward the end of the year and volumes would be sold at almost any price.
⇒ This article is an excerpt from EUWID's report on the German paper market. Find this article in its entirety in EUWID Pulp and Paper no. 46.
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