Herbert Eibach, general manager business development at CPI Paper, which sells $10m worth of paper every week to Australian printers, says if the Aussie dollar remains at its current level against the greenback a resultant decrease in local prices could be on the cards in the next few months, however he cautions that other influencing factors need to be taken into account.
Elbach says, “We could see a positive impact in three months but it may depend on other costs such as energy and pulp. Moreover, we don’t trade everything in US dollars and the parity will not affect other currencies. It’s hard to tell at this point in time but I would certainly like to see a decrease for local printers.”
Simon Doggett, managing director of the country’s biggest independent paper merchant KW Doggett says the currency will in most cases drive prices down, but not always immediately, and dependant on the country of supply. He says, “Currency is a major impact on landed costs of imported products, however other input costs are involved such as pulp prices and freight costs.
“We are currently reviewing our price strategy and are negotiating with our suppliers for currency price adjustments where possible. When we achieve this we will pass the savings on to our customers as fast as possible.”
The news follows an increase as high as 10 per cent which hit printers in August. Merchants said the increase was in response to surging pulp and raw material prices, as well as external factors including the Chilean earthquake, mill closures in Europe and cross currency fluctuations.
Looking further back to December 2008, Australian printers were slugged with another currency related increase just two months after they experienced the biggest paper price rise in living memory, with a near universal ten per cent increase, also caused by a plummeting Australian dollar.
The Aussie dollar has now risen by around 30 per cent against the greenback, since its lows of 64c two years ago, which had forced merchants to increase their prices two or three times in a short period of time.
Spicers Paper was unavailable for comment as Australian Printer went to press.
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