Suppliers Hike Photo Paper Prices

By Greg Scoblete -- TWICE, 6/2/2008

NEW YORK — The days of the dirt-cheap 4-inch by 6-inch photo print may be coming to close as two major suppliers of silver halide photo paper have announced price increases.

Effective July, Fujifilm will increase the costs of its photographic papers by between 10 percent and 20 percent, the company said last week.

Dai Nippon announced a similar increase in April, which is effective in July, said David Haueter, InfoTrends associate director.

Fujifilm cited "soaring" costs in silver and crude oil as contributing factors to the price hike.

The increases will impact paper, chemistry and other photosensitive materials.

Haueter said that retailers using Fujifilm and Dai Nippon papers are likely to pass on these price hikes to consumers in the form of higher print prices, although not on a percent-for-percent basis.

"I don't think this will have any impact on the overall volume of photo printing, because even if print prices go up, we're not talking about a lot of money," Haueter said.

Should retailers decide to pass along a price increase, it probably won't hit the market all at once, as supplies are purchased on a contract basis with fixed pricing, Haueter added.

Whether the price increase will push the retail price of photo prints up — particularly in the 4- by 6-inch market — remains to be seen, said Rich Tranchida, executive VP, Ritz Camera Centers, and a Fujifilm customer. His firm is taking a wait-and-see approach before adjusting its print prices, he said. "The price on a 4 by 6 is set for competitive reasons," he said.

The major brick-and-mortar retailers charged an average of 18 cents per 4- by 6-inch made over the counter in the fourth quarter of last year, according to InfoTrends. Print prices are more competitive online, with firms like Snapfish offering 4- by 6-inch prints for as low as 9 cents.

The steady increase in consumables costs may push retailers into new dry minilab technology, Haueter predicted. On average it costs approximately 20 percent less to produce a silver halide print than an inkjet one at retail, but that gap is narrowing, Haueter said.

"We expect to see silver halide continue in higher volume locations with 1,000+ prints per day where the lower cost per print offsets the advantages of dry printing," he said.

Kodak, the third major photo paper supplier, did not respond to a request for comment by press time.