While there is generally a more buoyant mood in the industry at the moment, there is an increasingly insistent murmur that ink prices may be on the rise.

So far there is nothing concrete, but what had been confined to idle conversation was crystallised earlier this month when Flint Group issued a statement highlighting increases in the price of raw materials.

Since Flint released its statement other ink manufacturers, including Stehlin Hostag/Hubergroup and Sun Chemical, have confirmed that they too are facing rising costs. It’s not just that costs are expected to rise, in many instances they already have, it’s just that the ink companies have taken the hit.

“It’s three years since the last price rises and it was difficult to pass them on at the time,” says Stehlin Hostag UK managing director David Ward. “We’ve absorbed a lot of raw material prices; the trend is clearly up and needs to be addressed.”

It may be that now there are signs of a general recovery the ink firms think there’s a chance they may be able to make price rises stick. They certainly believe that the increases are necessary pretty much across the board in offset applications.

“The increases are justified in all sectors,” says Druckfarben managing director Grant Penfield. “News-papers and heatset printing being the worst sectors. Sheetfed inks are under pressure too, but not as much.”

Affected raw materials span all the major components of inks including resins, solvents, intermediates and pigments. The source of the price increases include crude oil price caused by the numerous geopolitical problems in addition to tighter environmental regulations and some shortages in supply.

“Since mid 2013, unfortunately several key raw materials have increased in price,” says Flint Group senior vice-president for procurement Jan Paul van der Velde. “This was indicated at the end of last year and in May of this year, and now we see that this trend has become significant.”

The increases he cites have been substantial.

“Some red and yellow pigment intermediates, which are components of inks for every application rose by 30%-50% over the past several months, and there is no end in sight for these increases,” says van der Velde.

Gum rosin, another key material, has also risen again. Having peaked in 2011 at $3,500 (£2,100), the price has been rising again since the second half of last year.

“We have seen a number of raw materials under sharp cost pressure in 2014,” says Sun Chemical chief procurement officer Ed Pruitt. “Rosin resin is one, due to concerted efforts by the Chinese market to extract higher values for gum rosin.”

Eco impact

The majority of pigments and pigment intermediates are made in China and India. Tighter environmental regulations there have led to both price pressures, as the manufacturers seek to recoup the cost of compliance, and supply shortages as they implement the necessary steps.

Flint also highlights increased transportation costs throughout the supply chain.

Despite all these upward pressures on pricing, the latest evidence from printers themselves is that ink prices have fallen recently. According to the latest BPIF Printing Outlook ink costs decreased slightly in Q2.

“Ink manufacturers have struggled for years to pass on any price increases,” says Penfield. “Those rises never really stick as someone is always prepared to supply cheaper.”

This time though it looks like it might be different as the ink firms are taking steps to improve their efficiency and align capacity with demand.

While the firms have flagged up their rising prices they are tight-lipped about the likely magnitude of the increases.

In a statement Flint said: “We are constantly monitoring the global situation in order to be able to react adequately to changing market conditions. Our main focus is to provide on-time high quality products to our customers at competitive prices, which we can only ensure if we follow closely any developments in the raw material markets. At this point in time we cannot rule out a need for price increases.”

Sun said: “We will review case by case every market segment and customer for deciding price changes. We have not taken any decision yet.”

Hubergroup, the parent of Stehlin Hostag, which is currently restructuring its European operations, was more forthcoming, at least on the timescale.

“We’re looking at our internal efficiency and only once we’ve done that will we look and see what we may need to pass onto the industry,” says David Ward. “We have an evaluation underway. Expect a decision before the end of this year.”

While there is uncertainty about the magnitude and timing of ink price increases, there are steps that printers can take to minimise their effects.

“Printers are looking beyond the unit price to look at the impact on the cost of the whole process,” says Ward. “The intelligent buyer is aware of the impact inks and consumables have on performance. Compared to the 5%-7% of costs that ink represents, the waste levels, makeready and production time can be much bigger.”

Increased ink prices may be unavoidable, but be prepared and go into partnership with your suppliers and you can minimise the pain.