Consumables manufacturer Flint Group has warned that an evening out of raw materials in the last quarter of 2011 does not mean prices are on the way back down. After prices stabilized in Q4, coupled with the ongoing worldwide financial crisis, there has been speculation the print industry could finally see prices sliding backwards, after almost two years of regular price rises.

However, Flint Group SVP procurement Jan Paul van der Velde pointed out that hardly any materials actually dropped significantly in price in Q4 last year and Q1 this year.

He said: "Most materials stabilised at high levels or with very minor reductions, but when compared to the increases we have seen, they are still at near record levels. Overall costs for the ink industry will be higher in 2012 than they were in 2011, which had itself been a record high year.

"Crude oil in 2011 was on average higher than in 2008, when we all spoke about the crude oil crisis. We have already witnessed 2012 prices creep almost silently past 2011 figures.

"Crude is the single largest cost driver for the ink industry with many materials linked to this, such as mineral oils, hydrocarbon resins, carbon black and solvents, in addition to many other chemicals that are also indirectly linked to crude."

Van der Velde also said that crude oil was a very good example of how raw materials have resisted the economic crisis, with demand and speculation far outweighing the lack of spending power currently available.

He added: "Costs will continue to rise in the next few years due to the trend of increasing raw material costs caused by the global increased shortages and the better cost/price management of the chemical giants. Further speculation on major commodities will only further serve to compound the negative price effect.

"What surprises me is that the graphic arts industry seems to deny the facts. Of course nobody likes to talk about cost increases, but the customer has the right to know. We understand that our customers commit themselves to forward contracts with their customers based on their knowledge of costs developments."