READY, SET, GO! Paper price rises locked in

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Printing and communication paper prices will rise dramatically in the second half of 2021, with significant increases already locked in. A combination of factors is driving prices higher, with some regions already experiencing sharp increases.

For many, any news of price rises is hard to comprehend after years in which prices continued to fall and a short period of price increases that were so difficult to achieve, despite being so necessary.


Australian paper price movements

Some printing and communication paper grades are fully imported to Australia – and the proportion is even higher in New Zealand. The combination of small and distant markets locally, supplied by large global producers means the region is a price-taker, not a price maker.

As global paper prices increase, so too will they increase in Australia. [Eds Note: the global paper price information is only available to subscribers]

The first hints of price increases may be evident in the latest Australian data, but that is not certain just yet. The US dollar index below certainly shows average prices pushing up over the last year, after they had been stable until around late 2019, before declining, then crashing as the pandemic took hold.

Since March 2020 – just one, very, very long year ago – average US dollar import prices for all of these grades have recovered, and in fact increased to levels not seen for around two years. The exception is the coated woodfree sheets (coated two sides) which is marginally lower than the prices of two years earlier.

The other factor that the chart shows is that over four years since the start of 2017, average import prices are between just 8% and 13% higher or a simple average of just 2% to 3.25% per annum higher.


Selected Australian P&C Average Import Price Index: Jan ’17 – Feb ’21 (INDEX)

Source: ABS, derived, RBA and IndustryEdge


As the table shows, to some extent, the US dollar pricing index masks a different experience in Australia. The roller-coaster Aussie dollar ride continued over the last year and it plays out with Australian dollar pricing showing average price declines for some key grades over the last year.

That perception gap seems about to end because the USD price increases are likely to trend upwards quickly, over the next few months.

The table below displays the changes in price in both AUD and USD from February 2020 to February 2021. IndustryEdge subscribers have access to the actual price data, including price summary sheets and raw data files.





% Change

% Change




UCM Super-Calendered



CWF Reels (C2S)



CWF Sheets (C2S)










We have been asked repeatedly in April where the top of prices will be in 2021. We cannot be certain, but taking the lead from European markets, and from importers own statements, we know that Australian dollar prices will lift at least 10% on average, over the next few months.

Our assessment is that the pricing dynamic is locked in, and is largely outside the control of local operators. The drivers for price increases are quite clear and some are very obvious.


Why paper prices have to increase

Evidence of price increases is already evident, so it is important to get a grasp of what is driving both the current increases and the expected rises over the remainder of 2021.

As the table below shows, IndustryEdge considers there are five main drivers for paper prices to rise.


5 factors driving prices higher

  1. Unprecedented pulp price increases in early 2021 
  2. Significant supply chain and logistics disruptions arising from the pandemic
  3. Massive spike in freight costs, especially for longer routes 
  4. Massive capacity reduction by Stora Enso
  5. Solid demand growth for most paper grades in China and some recovery elsewhere


If there is one of these drivers we need to address in more detail here, it is the capacity reductions announced by Stora Enso. More detailed analysis is provided in the subscriber only content in Pulp & Paper Edge.


This is an edited extract of an analysis from Edition 190 (April 2021) of IndustryEdge’s monthly subscription data and analysis service, Pulp & Paper Edge. Each month, extensive analysis and commentary is linked with dozens of detailed data files for Australia and New Zealand, covering everything from latest price movements, major producer and importer activities, global market analysis and demand and consumption analysis.

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