Plastic Cores Increase in Cost

May 10, 2021
Dear Valued Customer,
I hope this letter finds you and your team well during this challenging period for many businesses.
Double H Plastics continues to strive in our efforts to minimize the impact of escalating cost factors for our customer base. For many months we have witnessed sharp price increases in our primary raw materials, high impact polystyrene and polyethylene, used to manufacture your extruded products.
The increases have been driven by extremely tight resin supplies as a result of many plant outages occurring in late 2020 and early 2021. Capacity from these outages has been slow to return, resulting in spiking resin prices in the presence of strong demand. Likewise, we have experienced continued upward pressure on wages, utilities, packaging and other associated costs.
Our team has been able to offset some of the increased costs through continuous efforts to achieve productivity improvements across our extrusion product line. However, these marginal efficiency gains have fallen well short of the significant costs we have absorbed during the past 12-18 months.
Against this backdrop, Double H Plastics is announcing a price increase effective with shipments June 1, 2021. HDPE products will increase by 17% and HIPS products will increase by 22%. This will enable us to offset some, but not all, of the cost increases we have incurred. Unfortunately, resin price increase announcements for polystyrene and polyethylene continue to mount due to very tight supply/demand balances for these commodity resins. Should these price increases come to fruition, we will have to adjust our prices again in the coming months.
In an effort to provide our customers with some potential relief, as resin prices should eventually begin to retreat, we will institute quarterly price adjustments based upon the relative change in resin prices commencing October 2021.
I understand news of price increases is never welcome and recognize the impact this will have to your business. Please know we have done everything possible to forestall implementing these prices increases, but we can no longer absorb the added costs. Double H will continue to reinvest in our extrusion business to assure our customers receive high quality, innovative products with excellent service.
Joe Harp, Jr., National Sales Manager; Extruded Products, will contact you regarding the details for the June price schedule for your products. On behalf of all of us at Double H Plastics, I want to thank you for your continued business.
Best regards,
Peter G. Haney
Executive Vice President
Quality to the Core!

Provided by Double H Plastic, Inc.

Printing Ink Supply Issues and Rising Costs

Date:     May 7, 2021

To:         To Whom It May Concern              

From:      Ken Klug, Director of Purchasing

Subject:  Raw Material Update (Customer Update)

The delivery of energy-cure raw materials continues to be very challenging. The end of Force Majeure for our many suppliers was anticipated to occur in May.  Lack of raw materials has forced suppliers to remain on Force Majeure. The limited suppliers that have come out of Force Majeure remain on tight sales allocation, making it very difficult to get materials on time or at all.  The importing of materials from overseas was anticipated to stabilize but instead remains very difficult.  Freight costs have skyrocketed due to container availability, ongoing port congestion, lack of chassis, drivers, and increased demand for air freight.  Lead-time for containers has nearly doubled due to the continued congestion.  Some suppliers have utilized air freight deliveries due to multiple containers being delayed in transit. 

Multiple chemical manufacturers are still impacted by the results of February’s winter storms in Texas. Energy cure feedstocks were the primary concern but as the weeks have progressed the remaining chemistries have also been impacted.  Material shortages continue to plague the entire graphic arts industry.  Demand remains high while supply chains try to stay “above water,” as they struggle to secure all the materials necessary to make their products. The Texas plants that are operating continue working through a backlog of orders. Suppliers are doing everything they can to fulfill orders as fast as possible, but we are likely looking at late Q2 or early Q3 until most come out of Force Majeure.

Costs also continue to increase due to the lack of supply, packaging, and the increased demand; especially for Acrylic and Epoxy feedstocks. Agriculture oils have encountered record cost increases over the past month which has impacted the offset inks and coatings.  Wikoff Color was hoping to see our cost plateau but unfortunately, costs and lead-times continue to accelerate higher. The ink industry continues competing with other industries, such as construction, metal coatings, plastics, electrical components, and adhesives, which makes it hard to get the chemicals that we need to produce inks. 

We’ll continue keeping you informed as supply issues are brought to our attention.

Sincerely,

Ken Klug

Director of Purchasing

Letter provided by Wikoff Color Corporation

 

Hansol Announces 12% Increase

Hansol announces 12% price increase on thermal paper in USA, Canada effective May 7 as new import duties are imposed

TORONTO, ON, May 7, 2021 (Fastmarkets RISI) – Hansol on May 7 announced a 12% price increase on all their thermal paper products in the USA and Canada, including light and heavy weights, top and non-top coated, effective immediately.

Hansol said the price increase is a result of “the recent preliminary determination of the antidumping duty, unprecedented increases in transportation and raw material costs.”

Thermal paper prices increased in North America by 10% in March, following several specialty paper producers’ announcements earlier in the year, including Koehler of Germany, Hansol of South Korea and Oji Paper of Japan, and US domestic producer Domtar, according to Fastmarkets RISI‘s PPI Pulp & Paper Week price survey.

Industry contacts told Fastmarkets RISI last month that they expected one or more price increases in 2021 due to higher raw material costs, low inventories, and possibly higher import duties.

AD case. US producers Domtar and Appvion last year filed an anti-dumping duty (AD) case against imported thermal paper, including jumbo rolls and certain converted rolls, from Germany, Japan, South Korea, and Spain. On May 6, 2021, preliminary determinations on the trade case were released, imposing the following duties: 2.78% for German exporters; 6.19% for Korean exporters; 35.71% for Japanese exporters; and 41.45% for Spanish Lecta/Torraspapel, as well as 37.07% for all other Spanish exporters.

Domtar and Appvion had called in their initial petition filed in October of 2020 for anti-dumping duties of 38.99% to 56.75% on thermal paper imports from Germany; 104.66-113.91% on Japan imports; 48.42-49.98% on South Korea imports; and 30.76-39.41% on Spain’s imports.

This information was provided by RISI.

Domtar wins with Anti-Dumping case

DOC has made a preliminary determination of the antidumping duty margins in the four thermal paper investigations.  The preliminary rates are as follows:

Korea:

Hansol: 6.19 percent

All other exporters:  6.19 percent

Germany:

Koehler: 2.78 percent

All other exporters:  2.78 percent

Japan:

NPI: 35.71 percent

All other exporters:  35.71

Spain:

Torraspapel: 41.45 percent

All others exporters:  37.07 percent

It is expected that we will be notified by all the mills of increases and plans of action the first of next week.

For questions, please contact bkent@telemarkcorp.com