Paper Outlook — Another Notch in the Market's Belt

Printers continue to report that prices are increasing, and that paper is available, according to Andy Paparozzi, chief economist for the National Association of Printing Leadership (NAPL). Each month, the association surveys printers on the availability and pricing of various grades of paper. In March, 81.4 percent of those polled indicated that prices were higher in comparison to prices three months prior. And 83.5 percent said that paper is still available.

"The price increases are substantial and well-established," Paparozzi reports. "However, the key thing here is that paper is still readily available, and that is what we watch very, very closely,"

Yet, when these figures are compared with polling results from March 1999, it is evident that with the rise in price, paper availability has tightened slightly. In March 1999, when prices were just beginning to rise, only 25 percent said that paper prices were rising, according to Paparozzi. However, in March 1999, 10.3 percent of those polled felt that paper was less available compared with March 2000, where 16 percent noted that paper is less available.

"If you look on the margins, you see a minority reporting that the supply has changed. Many more are reporting that paper is tighter," the NAPL economist adds.

But it's not just Paparozzi who is noticing the change in availability. Both Hayes and Creel report a tighter paper market when compared to 1999. "In comparison with last year, the paper market has definitely tightened. Paper is available, but lead times tend to be longer, machine trim is more of an issue and the mills are less likely to accept orders that are not a strategic fit," Hayes reveals.

Creel reports that groundwood products is where she encounters availability issues. "I would also state that grade 3 and grade 4 products seem less available, and are requiring more lead time to purchase than in the past," she remarks.