Converter concern grows as board prices rise again

At the start of August, M-real increased its folding boxboard prices by £80 per tonne in the UK, following in the footsteps of Iggesund Paperboard, which increased its prices by 20% in June in an attempt to counteract the weak pound.

Smurfit Kappa and Sonoco-Alcore have also announced price increases in brown containerboard and recycled paperboard, respectively.

Sonoco-Alcore will increase recycled paperboard prices by £40 per tonne in Europe from September due to the “higher costs associated with recycled paper and energy”.

While Smurfit Kappa has increased brown containerboard prices by Ä60 per tonne this month to combat the “progressively deteriorating” state of the European containerboard industry.

Carton converters have stated their concern in recent weeks about their ability to pass on price increases to consumers.

“What tends to happen at the moment is all the other mills will take this opportunity to increase their prices too,” said Alexir managing director Robert Davison.

“It makes it difficult for us to pass board increases on,” said Clondalkin’s specialist packaging division marketing director Chris Hill.

“We do not think it is sustainable to keep going back to our customers and increasing prices. It will increase our search for alternative suppliers.”

BPIF Cartons president John Monks called the price rises “ill-timed” and “opportunistic” in the carton industry’s main busy period in the run-up to Christmas.

Monks pointed out that it was especially hard for smaller converters who may be contractually linked to one material supplier by their customers.

“I do not understand why our industry lets customers dictate where they buy their board from,” he added.

PRICES GOING UP
• Folding boxboard
M-real £80 per tonne increase from 1 October
Iggesund Increased prices by 20% in June
Stora Enso Continued push for pricing quality, including heavy curtailments, has paid off
• Containerboard
Smurfit Kappa €60 increase per tonne from 1 September
Sonoco-Alcore £40 per tonne in Europe from September