Minimum impact of aluminium price hike in printing plates

Recently, business journals carried stories how surge in aluminium prices may result in vehicle price hike. However, for the printing industry, the concern is more immediate. As aluminium is the main raw material for manufacturing printing plates, the price hike may directly impact the existing cost of printing plates.

02 May 2018 | By Rahul Kumar

The sudden surge in aluminium prices has resulted from the recent sanctions imposed by the US government on Russia’s largest and world’s second-largest aluminium producer Rusal. In April 2018, aluminium prices surged by 30%. Rusal’s biggest export markets are the US and the EU, which are also the biggest aluminium deficit markets with a reported deficit of 4.7 and 3.8 million tonnes, respectively. The sanctions imposed on Rusal will take away over 6% of global supply, and 14% outside China, as per media reports.

According to the reports, average aluminium prices are expected to firm up by USD 150 per tonne globally. Beside the sanction, according to reports, input cost in aluminium is also includes. Plus, recently, around (around) two million tonnes of aluminium smelter capacity went offline in China because of pollution concerns.

Recently, TK Chand, chairman and managing director at National Aluminium Company (Nalco) and Aluminium Association of India's (AAI) president, said to news media, “In FY18, till the end of November, international aluminium prices had averaged at $2,000 per tonne. We expect, in the next financial year, prices would move up by $150 per tonne supported by capacity curtailments in China and demand pick up in EU and North America markets. Aluminium prices (on LME) have recorded the sharpest increase in this financial year of over $300 per tonne.”

Under these circumstances, to clarify the situation on printing plates, PrintWeek India had a brief chat with Evandro Matteucci, WW director of product management and business development, offset print and vice-president, print systems division, Eastman Kodak Company.

What would be the impact of the current developments on the printing industry?

Indeed plate manufacturers have been experiencing increased cost in raw materials in the past years while the recent increases directly impact plate costs. Having said that, we see a minimum impact to printers as plates account for only 2% to 5% of their total cost.

How will this impact your organisation and how are you prepared to combat this?

Kodak has been working hard to diminish costs to offset raw materials increased along the years but they have not been sufficient. Therefore, we have recently (early 2018) announced price increase all over the world to offset some of those costs.

If price rise happens, what would be the percentage vis-à-vis the current price?

We have communicated a price increase up to 9% around the world.

Your suggestions to printers and the pre-press houses to tide over the situation…

As stated, plates account to a very small part of the printed page costs. We recommend printers to go process free and completely eliminate the processing costs which can be substantial – everything from buying and maintaining a processing equipment to consumables and disposal of chemistry. We have recently launched Sonora X which will help printers save those costs while becoming more sustainable.