Mondi has said it will raise the price of its uncoated fine paper (UFP) by up to 12% in its upcoming quarter.
Mondi had already increased UFP prices by 2-3% in April, and the company said the new price increase will be implemented during the third quarter on the back of tightening supply and increased hardwood pulp prices.
Sales at UFP for the first six months of 2015 were €626-million ($682-million), a drop of 3% compared to the same period last year.
However, despite the ongoing structural decline in European UFP markets, the paper manufacturer saw H1 2015 underlying operating profit rise 41% to €113-million in the UFP division.
The increase was attributed to the higher selling prices in Russia, lower costs and the benefits of recently completed capital projects, which helped offset softer European pricing. Meanwhile, underlying H1 EBITDA at the UFP division rose by 19,6% to €152-million.
Mondi CEO David Hathorn comments: “As in prior years, the second half will be impacted by the seasonal downturn in our UFP business and planned annual maintenance shuts at a number of our mills. Price increases in certain paper grades should provide some positive momentum, offset in part by increases in various input costs and currency volatility.”
By Michelle Sturman, OPI