Paper Prices Increase for 2003: Consider Webcom's 'Paper Audit and Recommendations Review'

Maintaining a cost competitive edge for the price of your book depends on your ability to get quality papers that meet the specifications demanded by your marketplace. Papermaking efficiency and the paper market balance of supply and demand are the two drivers for paper costs.

Current paper market conditions reflect the continuing trends PaperClips has been reporting on for much of the past two years:

• Consolidation of paper suppliers leaves large volume control to a few suppliers.
• Reduction of supply capacity has been balanced to declining demand.
• Poor operating returns for papermakers have created pressure to increase prices.
• Moderate growth for most paper markets is creating some supply tightening and increased price pressure.

The result for Webcom and our customers has been price increases in almost all paper grades implemented in the 3rd and 4th quarters of 2002 (see Charts A + B, below). Most paper increases have been in the +3% to +5% range. This impacts a book’s final total costs by +1% to +3%.

PaperClips provides the following two charts of recent price trends to help our customers assess the cost changes of various papers and help you establish a strategy to combat costs to protect your margins. We offer these insights:

• Paper prices are rising because of supply tightening — not high growth in demand.
• Paper cost increases for Groundwoods, such as Publishers' Preference or Hi-Brite Groundwood, have been suppressed by Webcom through innovative paper sourcing which provides cost savings for our customers.
• Paper price outlook for 2003 is uncertain at present because recent increases were mainly supply driven.

With 2003 planning just around the corner Webcom provides consulting proposals on how to maintain paper quality and effectiveness while controlling overall paper costs.

Ask your Webcom Sales Representative for a Paper Audit and Recommendation Review of your 2003 publishing needs.

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Chart A: Paper Grades Pricing Trends, 2nd to 4th Quarters, 2002

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Chart B: Paper Grade Trends & Relative Costs, 2002

• Trends and relative costs for paper continue to reinforce the value of high brightness Groundwood grades such as Webcom's Publishers’ Preference, Hi-Brite, Bookbrite and Hi Bulk papers. These papers have similar paper specifications and functional performance versus Fine Papers, but at -25% to -40% of the paper cost. A real opportunity to assess your paper requirements and options.
• Publishers’ Preference is a new grade introduced two years ago. It is a high quality, great financial value vs. book opaque.

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Webcom Tours Recycled Paper Mills

In October, Webcom Limited and New Leaf Papers hosted a trip to two paper recycling plants, Badger Paper Mill in Peshtigo, WI and Manistique Mill in Manistique, MI and also to the Great Lakes Post-Consumer Waste Mill.

The purpose of the trip was to foster a better understanding of the recycled paper production process and how it differs from virgin sheet production.

“I've been to various other paper mills and it was amazing to see the process at these mills — seeing waste go in one end and print-quality paper come out the other.” (Donna Quinn, Webcom Sales Representative).

“We also had the opportunity to drive by a standard paper mill, which really drove home the difference. Lined up outside this mill were tractor trailers full of virgin logs.” (Rachelle Sunga, Webcom Sales Representative).

Webcom is committed to helping publishers lessen the environmental impact of paper consumption by offering three standard stocks of our new ‘Legacy’ brand of recycled papers — Legacy Brite, Legacy Natural and Legacy Offset. Samples of all our papers are available from our Sales Representatives or you can request them online by clicking here.

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Paper Tip: Webcom's Economical Groundwood Papers Make Good Alternatives To Fine Papers

Increasing Fine Paper costs reinforce the value of high brightness Groundwood grades such as Webcom’s Publishers’ Preference, Hi-Brite, Bookbrite and Hi-Bulk papers. With cost savings of 25% to 60% these papers offer excellent print characteristics and similar paper specifications versus Fine Papers.

Publishers’ Preference is a good alternative to our premium Book Opaque or Recycled Offset. Hi-Brite is more than acceptable for Trade and Educational readers, study guides and catalogs. Trade and other publishers looking for a high-bulking paper should consider Book Brite or Hi-Bulk.

Webcom’s sales, estimating and paper management teams continue working with customers to develop the most efficient paper plans.

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