Suppliers to the printing industry in Russia are scrambling to find alternative sources of supply ahead of the implementation of EU sanctions which take effect on 10 July.
There will be much activity centred on the Printech exhibition in Moscow at the start of June. But before then, distributors will be hoping to have secured alternative sources of supply for products that have traditionally been exported from EU countries. Chinese suppliers will be well placed to fill gaps for consumables while capital equipment may take longer to replace.
Economic action from the EU and beyond is already having an impact on the Russian print sector already suffering from the same supply chain disruption that printers elsewhere are experiencing.
Ahead of imposition of sanctions, NCL, one of the largest distributors in the country, is creating its own brand for a range of consumables and equipment that might be affected by sanctions. It would also take on the warranties for machinery sold under the new branding. The Russian government has decreed that any alternative products can be sold in Russia without regard to traditional licensing or copyright issues.
In an interview with leading graphic arts magazine Kursiv, NCL director Ekaterina Makeicheva says that disruption of supply for printing plates has created the most challenges. The company has traditionally supplied Kodak plates and platesetters and Kodak, like rivals Fujifilm and Agfa, produces plates inside the EU. All three also have operations outside the EU which may not be subject to sanctions.
However, the relationship is changing. In a statement, Kodak states: “Kodak Russia has provided a termination notice of its agreement with NCL. Until the conclusion of the agreement in approximately 90 days we intend to continue to honour our contractual obligations as permitted by restrictions.”
This would allow NCL to build up stock ahead of the cut off point enabling it to maintain a source of supply to customers for the short term. In the medium term, other arrangements will be needed. Makeicheva says: “With the advent of plates under our own brand, it will be even easier for us to provide a full range of service support. In addition, we start deliveries of used output devices.
“For many print shops, this may be a good solution at this stage. Kodak makes devices that are reliable and durable, so even used prepress equipment is a good buy that will last for years to come.”
The industry in the country is expected to shrink by 25-30% this year with retail flyers effectively eliminated, other advertising especially for luxury goods taking a toll on magazines, packaging hit along with newspapers and magazines.
However, this is nothing compared to the damage to the economy in Ukraine caused by Russia’s invasion of the country.
A study by Advancer Group has said that SMEs had lost $64-85 billion since the start of the conflict with business activity hitting record low levels. And with a lack of solvent customers in the country, no improvement can be anticipated in the near future. It reckons that 49% of companies in Ukraine have stopped trading temporarily or have closed completely. A separate survey reckons the real figure to be closer to 70%. Just 6% claim to have been able to grow in the last three months.
That said, others report that the banking system is holding up well partly because the Ukrainian government had acted in 2014 to insist on stronger balance sheets while Covid spurred the move to digitisation.
