Raw Material Shortages Affect Ink Prices

Nitrocellulose

Nitrocellulose supply continues to be very tight globally. Price pressure is increasing as well with increases implemented in the double digit range from most suppliers for Q2. If demand continues and cotton/wood pulp prices remain at elevated levels, there will be additional increases for Q3. Wood pulp producers are having production issues. The cotton linters growth was stronger in 2010 but the overall amount released to the market has not increased, allowing the value to increase for the farmers. In addition, cost driven challenges on cotton (floods in Pakistan and similar crop issues elsewhere) and the increased costs for wood pulp (demand) have had a significant upward impact.