Exceptionally long delivery times for cartonboard.

Your cartonboard supplier not only has to deliver your orders on time, he also needs to provide you with accurate information regarding the market situation so that you can anticipate delivery times and receive your orders at the desired time. We therefore see it as our duty to draw your attention to the fact that the situation, in particular with respect to graphic papers, has now become quite exceptional. There is currently a shortage of cartonboard to such a degree that the delivery time has evolved from 3-6 weeks to a minimum of 3 months and this applies across the board to virtually all cartonboard producers. The reason for this shortage is a combination of various situations occurring at practically the same time. The last three years, various factories have been closed or have dismantled machinery, due to the ongoing crisis in the cartonboard sector. As a consequence, 15% of the total capacity in Europe has disappeared, which translates into 765,000 tonnes. Additionally, an earthquake occurred in Chile in the spring, that temporarily halted 10% of the world production of pulp. Shortly before that event, we were confronted with the strikes of the port and transport businesses in Scandinavia, causing a backlog in the production and distribution to accumulate. Cartonboard is used primarily in the packaging industry, which is a strongly growing market, despite the economic crisis. Cartonboard is an ecological packaging material and has many advantages compared to several other materials and is in a positive spiral. And now another factor has come into play: many food products that were formerly packaged in GD cartonboard (recycled board with gray back) are now to be packaged in GC cartonboard (new fibre board with cream or white back). For these reasons we regret to have to inform you that the delivery times, particularly for GC grades, are long and are going to remain long. The prices too, are set to increase as demand is much larger than supply can meet. Thanks to privileged contacts with our suppliers, we can nevertheless still offer delivery periods of 3 weeks for volumes in GC and sulphate board to a maximum of 10 tonnes. We are managing to keep our stocks up and starting at 1 tonne we can offer various qualities cut from reels with a delivery time of approximately 1 week.

We would like to thank you in advance for adjusting your purchasing behaviour for cartonboard and for placing your orders on time.

Sincerely yours,

Your cardboard supplier