Price Adjustment Announcement – Effective 7 May 2025

Date: 23 April 2025

At Just Paper Tubes Ltd, we are committed to delivering high-quality, reliable products and service to our customers across the UK and Europe. In order to maintain this commitment amid rising economic pressures, we are announcing a 5% price increase, effective 7 May 2025.

This decision is driven by two major factors beyond our control:

1. Ongoing volatility in the paper market, and

2. Confirmed increases in Employer National Insurance and the National Living Wage, both of which took effect this month.

We will be communicating directly with all our customers in the coming days to discuss what this means and how we can support your operations during the transition.

🧾 Paper Market Volatility: No Sign of Easing

The paper market continues to face instability, marked by rising prices, reduced capacity, and persistent logistical disruptions. The following trends are currently driving up costs across our supply chain:

1. Board Material Cost Inflation

The cost of recycled board – including coreboard, testliner, and kraftliner (clickable links) – remains high. Several mills have introduced further price increases in Q2 2025, citing high input costs, strong global demand, and ongoing energy volatility. While contractual waste prices can vary by up to 25% month-on-month, anecdotal market intelligence suggests spot prices have surged by well above this in recent weeks. Spot volumes—used to bridge gaps in regular supply—remain highly volatile, with some sellers reportedly holding back material in an almost highest-bidder approach.

Although contractual and regular supply agreements typically offer in-month price stability, they often track the overall trend of the spot market. This now appears to be the case, with contracted rates beginning to reflect recent upward movement. Spot pricing continues to serve as a leading indicator in the recovered fibre market—despite its unpredictability.

2. Energy and Freight Costs

With energy (gas and electricity) prices still above pre-2021 averages, the energy-intensive nature of board production continues to affect pricing.

3. Export Competition and Global Demand

Global markets, particularly Asia, continue to put pressure on available supply, with European producers securing higher-margin export deals. This has tightened availability locally, creating additional cost pressure in the EU & UK market.

We have absorbed cost increases over the past month to support our customers, but recent movements make this no longer sustainable without impacting service.

👷‍♂️ Confirmed Legislation: Increased Employer Costs from April 2025

In April 2025, two major UK Government labour cost increases came into effect:

✅ 1. Employer National Insurance Increase

From 6 April 2025, the rate of Employer National Insurance Contributions rose from 13.8% to 15%, with the secondary threshold reduced from £9,100 to £5,000. This change increases the National Insurance bill on a typical full-time worker by hundreds of pounds annually. For a business like ours with a significant direct labour force, this is a substantial impact on operational costs.

✅ 2. National Living Wage Increase

Also effective this month, the National Living Wage increased by a rise of over 9.8%. The lowest hourly rate at JPT is £13.09, something we are proud of. Irrespective of age.

At Just Paper Tubes, we fully support fair pay and employment standards. We’re proud to provide secure and meaningful employment to our staff in Selby and beyond. However, to remain competitive in the area, recent wage increases have sharply increased our wage costs across the business. While these are positive moves for workers, they must be sustainably funded.

📦 Why We’re Increasing Prices by 5%

Taking into account the persistent cost pressures from the paper market and the confirmed increases in staffing overheads, a 5% increase on all product prices is necessary from 7 May 2025.

We have worked hard to avoid this by:

• Improving operational efficiencies,

• Negotiating robustly with suppliers, and

• Absorbing wider inflation linked cost increases throughout 2024.

Unfortunately, these latest developments mean we can no longer maintain current pricing without compromising quality, lead times, or service standards.

🤝 Direct Customer Communication

We believe in openness and partnership. In the coming days, our commercial and customer service teams will be in touch directly with all customers. We will explain any changes relevant to your specific products, trading volume and contract terms, and we will offer any support we can to help manage the adjustment.

🔍 Looking Ahead

Although 2025 has already proven challenging, we remain optimistic about the resilience of UK manufacturing and the value we bring to our customers. This pricing decision will allow us to:

• Continue delivering on our promise of quality, consistency and reliability,

• Sustainably invest in our people, systems and operations, and

• Protect our supply chain security in the face of ongoing global headwinds.

We thank you for your continued support, trust, and partnership.

If you have any immediate questions or wish to discuss pricing or supply terms, please contact your account contact or reach us at sales@jptcores.com.

Yours Sincerely,

Harry Coates

Managing Director

Just Paper Tubes ltd.