What Do We Know
Well, there’s no avoiding it—there is a (paper) elephant in the room, and it’s been there for several weeks. The on-again, off-again tariffs on Canadian goods are effective April 1. Tariffs on aluminum from overseas vendors are set to severely compound already-high printing plate prices. To date, it has not been confirmed if litho-grade aluminum will be subject to the tariffs placed on commodity aluminum. As much as things change weekly, or even daily, we might not want to talk too loudly about the elephant. Maybe keep it at a whisper. Once things zoom-out a little and start to solidify, the print and paper industry can start to put things in dark ink. Pardon the pun.
Roughly 30% of the paper used in the U.S. is from foreign sources. Kingery Printing primarily procures its paper (over 80 percent) from domestic sources. A tiny sliver of our international supply comes from a single mill in South America. The other 19+ percent comes from Canada, particularly the lightweight coated and uncoated groundwoods. The super-calendared papers used for body stock in the magazine and catalog markets are also Canadian.
We are already seeing an influx of printers trying to source domestic paper from domestic mills. This in hopes of avoiding hiked-up prices due to tariffs. This will increase demand on domestic mills, and potentially drive their utilization rates higher and potentially the price. It is also unclear what percentage of the paper recipe used by domestic mills may be subject to tariffs; for instance pulp, barium carbonite, calcium carbonate, etc. We are watching this very closely. Many other mills previously made the switch from white paper to cardboard post-2020. Anyone familiar with junior high social studies knows the laws of supply and demand will drive the price of ALL paper higher. We began seeing these jumps as early as February. Many customers have formally and informally chatted with Kingery Sales, Customer Service, or Management teams. The questions could all be reduced to “What will tariffs and this uncertainty mean for the price of my project?” The simple fact, right now, is it depends on the paper choice.
Remaining Even Keel
Unfortunately, Kingery does not have all the details nor the full scope. What we can promise is, any paper we have on our floor (nearly $6M worth) will avoid any knee-jerk tariff. Kingery’s estimators will not add in any inflated “futures” rates. If a mill raises prices to offset increased demand or a tariff on their product, that will be passed along. Kingery will continue to do what we have done since 1968: innovate, learn, compete, and serve customers to the best of our ability. We have delivered tremendous value during that 56+ year history. The last two years have been spent adding equipment to open new markets, setting the technological bar, and streamlining our processes. We are in a lean position to weather storms such as these. Our goals are keeping our prices competitive and never cutting corners on quality or timeliness.
To stay up-to-date on the latest, you can follow along here on what tariffs are in place, what countries they target, and which have been retracted. For questions pertaining directly to Kingery, you can always reach out to your salesperson or CSR, or email us here.
