Like many other industries around the world, the paper production industry is facing a supply chain shortage. Paper prices have inevitably increased, and not only are the prices increasing, but the availability of paper stock has become slim as raw material costs rise, mills enact allocations and price increases, and labor shortages continue.
The supply chain shortage we are currently experiencing has kept many commercial print companies out of the market due to cost alone. Baesman, has managed to invest in large quantities of paper inventory, which allows us to better manage price inflation for print products and stay ahead of larger production issues for our clients.
Why Is There a Paper Shortage?
The paper supply chain has been under pressure for over a year. In June 2021, some of the paper manufacturers announced a 10% price increase on their coated and uncoated paper, which was their first increase since 2014.
Later in the year, we started experiencing another severe shortage of raw materials. The pulp that paper mills use to produce printable paper has become scarce and more expensive, making it hard for print companies to operate at their normal capacity. But a lack of raw materials is only one factor of the supply chain shortage, and there are a variety of causes like:
- Paper mills reduced their workforce during the turmoil of 2020.
- Many mills transitioned into making boxes versus making paper for direct mail pieces. When the pandemic hit, many paper manufacturers turned their attention to the production of cardboard instead of printable paper. After all, with everyone working from home, online sales were booming, and shippers needed cardboard boxes.
- Paper types and paper grades were discontinued.
- Transportation took a hit in 2020: Airlines encouraged their pilots to take early retirement and the trucking industry tightened their workforce and schedules. Freight costs also increased 20x from 2019.
When Will the Paper Supply Chain Stabilize?
According to industry experts, the paper shortages and rising prices are expected to persist through 2023, with a potential further spike in demand during the summer months of 2022.
The good news is that we are here to help you navigate the shortage and keep your projects moving.
How the Paper Shortage is Affecting the Printing Industry and What We Are Doing for You:
Many of the mills are running at or near full capacity, and some specialty grades are on allocation, affecting lead and turnaround times. We are doing everything possible to get you the best pricing and deliver your jobs on time, but steps you can take to ensure your needs are met include:
- To avoid significant price changes, we highly encourage pre-planning on all jobs. Connect with us early for large projects. We are currently buying paper for projects two months in advance.
- Create a contingency fund for your budget. Paper prices are changing rapidly.
- Be flexible with weight and finish. The exact paper you want may not be available, but there are options that can give you the desired look and feel.
How You Can Secure Your Paper Needs
Baesman is combatting the shortage by bumping up inventory of our most popular papers. We currently maintain a wide supply of paper and are striving to get more sheets, if necessary, to ensure future job opportunities for our clients. We are also able to secure first priority with several paper providers due to our trusted buying history.
With 70 years of expertise, we are well-versed in overcoming obstacles and offering exceptional client service, even in the most trying and demanding of circumstances.
Want to talk about paper strategy? Let's talk! We'll do everything we can to ensure that your projects continue to go out on time.