Each piece of mail that we print starts somewhere. For us it’s with these rolls of paper. Before we get these rolls into our facility, we have to source them from a paper mill. In today’s world that is easier said than done. For the past year and a half, we have been working tirelessly to secure the paper we need to print your direct mail campaigns.
About this time last year, the paper industry was hit with the compounding effects of the COVID-19 pandemic. With the labor shortage, and supply chain disruptions, the ability to maintain our paper supply was at risk. Our Procurement Specialist, Helena Nichols, has been fighting this battle head on for the past year.
Starting with raw materials, wood pulp used to make paper increased 50.2%. At the beginning of the pandemic many paper mills shut down production. When they opened back up they struggled to keep up with the demand. This resulted in a 121% decrease in available tons of inventory, from 530,000 tons in 2019 to less than 130,000 tons today. As the domino effect continued, in December 2021 to June 2022, we have seen an increase of up to 30% in sheet fed paper and up to 40% increase in the coated gloss roll fed category. Envelope prices have also increased 48%.
The paper stocks most affected are coated gloss, supplied by two mills that represent the predominant market Billerud and Sappi Paper. These mills supply the market through an allocation system, based on the amount of production time available and the number of printing businesses that are on the waiting list for their paper.
Paper mills are currently reviewing their portfolio, discontinuing items, and choosing what markets to invest in. Our Procurement team created and strengthened relationships with paper suppliers by showing the value of our curated direct mail campaigns and the consistency our demand is for each stock requested.
We are overcoming this economic hardship by being adaptable with our product type offerings while maintaining constant communication with our suppliers to diminish the effects of this global paper shortage to our customers. We believe that the worst of the crisis is coming to an end. While the market is not back to where it was before the pandemic, it is more predictable than it was a year ago.