Paper Planes: what the pulp is going on?

This article was first published in the May 2021 issue of Australian Printer

The Australasian Paper Industry Association, APIA, is the powerhouse of companies servicing our industry for all things paper, from mills, local and off-shore, to merchants and distributors in Australia, and New Zealand.

In its simplest terms, APIA is the body that represents our largest raw material providers – paper.

Whilst a long-established industry body, APIA, it could be argued, has really found its feet and developed a clear purpose to work within the industry to drive mutually beneficial outcomes for all.

The appointment and merged partnership with The Real Media Collective, provides me the opportunity work with the APIA Board and connect commercial print matters with the supply chain.

It has proven a marriage of success with a mutual submission to government across the Waste Export Ban delivering an extension for graphic paper grades, partnership to State government across EPA and paper recycling definitions and now joint approach to the ‘Love Paper’ campaign to promote the environmental and social inclusion credentials of paper.

The APIA Board has a committed focus, to ensure the availability and continuity of fibre-based products into the Australian and New Zealand marketplaces.

Through its members, APIA is bringing innovation to market and reinforcing the benefits of a sustainable approach to manufacturing of collateral using fibre-based products.

A key role in achieving this missive is to inform industry, where fibre-based products are an important input, of the latest trends and developments effecting the industry.

Secondly, to ensure our industry has a voice with policy makers at all levels of government to ensure policy works with industry and understands how industry works.  

Key projects for 2021 include the Love Paper campaign to promote the power of paper and print, government policy and lobbying across single use plastics and the recyclability of fibre-based products and critical in the current landscape is the review and preparedness of global pulp price increases.

Throughout COVID, the APIA team watched with keen interest to the impact of international freight price increases across paper pricing.

The global pulp consumption across non-graphic paper ranges was becoming a matter of growing importance.

As reported in late 2020 by Bloomberg.com, ‘Global supplies of the material used to make paper, paper cups, tissue and cardboard are tightening as Chinese demand recovers and after high-cost producers cut output in reaction to a pandemic-fuelled price slump. That is good news for low-cost companies like Sao Paulo-based Suzano, which has started to ratchet up prices, and ratchet they have, with increases in Hardwood pulp of 25 per cent plus since August 2020’.

Pulp producers are being affected in two ways, production challenges and those driven but changing consumer demands.

The continued global growth in fibre-based packaging has provided new growth for pulp producers, however tissue pulp still represents at least 40 per cent of the market, according to Pulp & Paper Canada.

Prices have also risen in Europe, with again Bloomberg.com reporting, observers are predicting they will get to $850 this year. This represents another 25 per cent increase.

RISI, the authority on reporting in this area, recently headlined ‘Pulp prices poised for further gains in Europe in April’,suggesting the increases have taken hold and APIA is working within its realm to review, understand and comprehend the impact of these global demand shifts.

How will this affect us?

Do not panic. We have seen this before; at least once a decade or in line with global economic conditions where pulp prices increase mounting upward pressure on paper and other end product prices.

There will inevitably be some short-term price increases, which in the current landscape seems logical as the world tries to find its feet again.

The best thing we can do is prepare, engage and communicate. We need to work through the next 12 months understanding supply may tighten, freight conditions and pricing will continue to challenge the market which is why promoting our channel is more critical than ever to stabilise, if not increase, demand.

We need to maintain value in how we sell paper and print products and understand everything we can about fluctuating global pulp prices.

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