Demand for forest products at an all-time high

As publishers and printers are aware, the paper market is extremely tight, with longer lead times and higher prices. What factors have converged leading to a high demand for paper, packaging and forest products?

1. Increased demand in the pulp market has been aided by a rebound in economic activity resulting in a much tighter market than a year ago. Paper producers have extended order lead times. Inventories are low. Mill costs have skyrocketed, and users have seen increased prices on most every paper grade. This includes newsprint, all uncoated groundwood grades (SC, hi-brites), all coated grades, and uncoated freesheet.
2. Most wood products, including lumber, plywood and oriented strandboard have increased in demand to peak levels due to limited new supply, stronger demand from new housing starts and renovation and remodeling activity.
3. Demand for paper packaging and tissue is expected to remain strong into 2021 as consumers continue to buy online, resulting in shipments directly to the home rather than in bulk to retail outlets. Paper packaging will continue to be preferred over plastic packaging as consumers look to be more environmentally conscious.
4. Demand for tissue products will normalize, after spiking in 2020 due to panic buying during the pandemic.

Increased demand in tree consumables notwithstanding, fuel and energy costs continue to rise and transportation costs are up as the number of freight loads outpace truck availability. Industry analysts fully expect mid-year price increases to be announced by paper producers, for all grades of printing and writing papers.

Help us help you by planning and committing to your print projects as far in advance as possible. While many printers, including BR, have house stocks on hand, replenishing inventory is taking longer. With paper lead times running up to 10 weeks out, depending on brand, its more important than ever to secure paper supplies early and lock into pricing before it increases again.

Contact us (info@brprinters.com) or call your account executive to discuss further.

 

Sources:

https://www.moodys.com/research/Moodys-Global-paper-packaging-and-forest-products-outlook-remains-positive–PBC_1272605?cid=7QFRKQSZE021

https://www.quad.com/resources/documents/paper-market-update-may-2021/