Agfa has become the first major plate producer to announce a further rise in prices, driven by the increasing cost of aluminium. It is likely to be joined by Kodak and Fujifilm in the near future.
But these suppliers and printers have been saved from an even bigger increase after Russian oligarch Oleg Deripaska stepped down from the board of Rusal. The US government has imposed sanctions against Deripaska which would have prevented any US business from trading with companies he controls. This would include Rusal, producer of 7% of the world’s aluminium and through its plant in Ireland supplier of 30% of European demand for alumina, the material that becomes the metal once smelted.
Price for aluminium had been on a steady decline from the start of the year to below $2,000/tonne in April. But since the announcement in the US prices have soared, reaching $2,380 at the peak and ending on Friday at $2,270/tonne at the London Metal Exchange.
Stefaan Vanhooren, president of Agfa Graphics, says: “Soaring prices of aluminium – the largest cost component of a printing plate – are the main reason for this decision.
“However, thanks to the increased intrinsic recycle value of the used printing plates, the price increase will not necessarily result in a cost increase for our customers.”
The sanctions driven rise is coinciding with increased demand for the metal, expected to be more than 1.1 million tonnes ahead of supply, prompting plans to restart mothballed smelting facilities. Other facilities across the world have been hit by force majeure incidents leading to their closure.
While Deripaska’s decision to step down may ease the threat of sanctions, it will not in itself reverse the price rise. And as this price is paid by all consumers of the metal, neither Kodak nor Fujifilm can afford to absorb the increase and will lift prices.
All have been pushing to add value to their products through development of more eco friendly plates, which deliver greater value to printers and can differentiate products from others in the market. Kodak identifies its Sonora plate family as a key plank for future growth; Agfa has built a structure around its Eco3 approach combining plate, chemistry and software to save costs in the workflow and Fujifilm is introducing the Super LHS2, a chemistry-free plate for printers that want to eliminate chemistry in processing but do not want to use a develop on press plate.
Vanhooren adds: “This is why we believe our customers will understand the rationale behind these exceptional price increase actions.”
The threat of US sanctions against Rural has helped force the price of aluminium to highs not seen since 2011. This has forced Agfa to announce a price increase with its rivals expected to have to follow suit.
