Paper Price Increases Add Pressure to UK Packaging Costs

The Packaging Club has continued to hold pricing steady across our range since June 2024, despite growing pressure in the paper market.

Over the past few months, both recycled and virgin paper costs have surged. Recycled paper has increased by £50 per tonne, while Kraft grades have seen a £60 per tonne uplift. Further increases are anticipated as mill closures in the United States are set to remove over 1.5 million tonnes of paper capacity from the market.

Global uncertainty and the impact of geopolitical tensions on tariffs are adding further instability, impacting manufacturing input costs and dampening buyer confidence across the sector.

So far, we have absorbed all raw material fluctuations without passing them on to our customers. How long that position remains tenable is unclear, but we’re monitoring the situation closely. At this stage, no changes to our current pricing are planned.

Plastic Packaging Tax and EPR to Push Costs Higher

In 2025, the price of plastic packaging is expected to increase due to a rise in the Plastic Packaging Tax (PPT) rate, which will be £223.69 per tonne from 1 April. This tax applies to plastic packaging containing less than 30% recycled plastic that is manufactured or imported into the UK.

The increase in the tax rate will lead to higher costs for businesses using non-compliant plastic, potentially leading to price increases for consumers and further down the supply chain.

Additionally, the introduction of Extended Producer Responsibility (EPR) for packaging, with payments due in October, will also contribute to the rising cost of doing business.

If you’re concerned about packaging cost increases or want support reviewing your supply, get in touch with our team.

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