A necessary home product in your kitchen is paper towels.
They help clean up messes fast and take the place of napkins in a pinch.
Since they’re a paper product, paper towels used to be quite cheap.
However, recently, you may have noticed that paper towel prices have risen.
It may make you wonder why paper towels have become so expensive.
Why Are Paper Towels So Expensive? (10 Reasons)
In 2021, the average household cost of paper products including paper towels was $107.28.
With the average cost of paper towels ranging from $4 to $14, it’s obvious that some paper towel brands are expensive.
Certain factors like worker shortages, lumber price increases, and more eCommerce businesses have all impacted the price of paper towels.
1. Raised Energy Prices
Paper towels are expensive due to high energy costs.
It takes energy to produce items.
Paper towels, which are primarily made in a factory, take a lot of energy to produce.
Whenever energy prices increase, costs for manufacturing also increase.
Since manufacturing costs are high, the price of paper towels is also high.
It isn’t just energy in terms of electricity alone either.
The cost of fuel is also high.
That influences the price of paper towels because the production of paper towels utilizes heavy machinery to chop trees and turn them into wood pulp.
Since fuel costs are high, the cost of operating those machines is also high.
There are several reasons why energy and fuel costs are high.
War in Europe, supply chain problems, and refineries that still aren’t operating at full capacity are all influencing the problem.
Even if one of those became fixed, the other factors would still be driving up the cost of energy and fuel.
As such, since the price of energy and fuel remain high, the cost of producing paper towels also remains high.
Until the price of energy and fuel goes down, paper towels will likely remain expensive.
2. High Lumber Prices
Another main reason behind paper towel prices is high lumber prices.
Although wood used in lumber is separate from the wood used in paper towels, they have a correlation.
Lumber comes from trees.
Paper towel comes from wood pulp which also comes from trees.
Whenever lumber increases, other types of wooden products also tend to rise.
For one, manufacturers sense an opportunity.
They can blame it on lumber prices.
There is a direct relationship between lumber and paper towel prices, too.
Both require trees, but in many places, trees are a finite resource.
Unless the company plants as many trees as it harvests, it’s running out of their resources.
As such, supply is slowly dwindling while demand remains.
Since demand is higher than supply, it makes the price of all wood-related products more expensive.
Lumber also impacts the price of paper towels because it usually means manufacturers are trying to get more lumber to meet demand.
Lumber prices rise when there is more demand than supply.
To help lower the price of lumber, the supply has to increase.
This means that some manufacturers might stop using some trees for wood pulp and instead use them for lumber.
This ends up reducing the number of paper towels that are available for sale.
The supply of paper towels becomes lower than its demand.
As a result, the price of paper towels becomes higher.
3. Low Recycled Tissue Amounts
One of the ways that manufacturers have continued to make paper towels inexpensive is by using recycled paper products.
They use recycled paper products to make clean and sanitary paper towels.
This helps them reduce manufacturing costs since they no longer have to produce wood pulp.
They can use the existing paper to make their products.
The problem is that a lot of paper towel companies are facing a shortage of recycled material.
One of its primary donors, offices, is to blame.
During the COVID-19 pandemic, many offices closed.
As the virus swept through the population, mandatory shutdowns were in place.
People were unable to go to work.
Instead, their employers had them work from home.
This meant that those offices didn’t have people there to recycle paper products anymore.
As such, paper towel companies didn’t have as many people donating paper products to them.
Since they didn’t have recycled paper to fall back on, paper towel companies had to buy more wood pulp.
That made producing paper towels more expensive because they were adding to their costs.
They moved those costs onto the customers.
Those problems may still plague the paper towel manufacturers even after a lot of offices have opened back up.
Some companies have found that working from home is more profitable and less expensive.
They are not requiring their employees to return to the office.
That means that some offices won’t ever open again.
Those are key sources of recycled paper that paper towel manufacturers will be without.
Until more people donate recycled paper, paper towels will likely continue to have expensive prices.
4. Paper Mill Worker Shortages
Paper towels are also expensive because of the paper mill worker shortage plaguing the industry.
Working in a paper mill is tough, exhausting, work.
It also tends to pay not well.
It’s a minimum wage job that doesn’t always offer the best benefits.
During the COVID-19 pandemic, paper mills had to shut down to keep their employees safe and healthy.
Some paper mills also chose to let their employees go because they weren’t able to pay them without risking the business.
When the paper mill opened back up, not all of its workers returned.
The time off allowed the workers the chance to find better-paying work elsewhere.
Other workers demanded higher pay to return to work.
Some paper mills capitulated and were able to get running again.
Many still struggle to find workers.
This impacts the price of paper towels because it means there are fewer workers in the factories.
With fewer people producing paper towels, it means only a certain number gets produced each day.
If the factory was full, the company could produce paper towels at max efficiency, but that isn’t the case.
With fewer paper towels coming out of the factory, it impacts the supply in the market.
There is less supply available yet demand is higher than ever.
This results in higher prices.
5. Paper Mill Shutdowns
Paper towels are also expensive because some paper mills had to shut down.
Whether it was because they weren’t able to weather COVID-19 or other reasons, there are fewer paper mills around.
This means that there are fewer factories producing paper towels.
This impacts the price because it directly impacts the supply.
Even with the supply low, the demand for paper towels is high.
Paper towels are extremely useful in cleaning.
With the pandemic still around, people are still trying to keep themselves, their homes, and their businesses clean.
With less of a supply to go around and high demand, manufacturers have to raise the price of their paper towels to mitigate demand.
Until more paper mills open, there’s a chance that paper towel prices will remain high.
6. Increased eCommerce
Another main factor influencing the price of paper towels is eCommerce.
Paper towels aren’t the only product that uses wood pulp.
It’s also a useful ingredient to make everything from toilet paper to cardboard boxes.
The eCommerce industry uses a ton of cardboard boxes to ship goods.
Before COVID-19, there wasn’t that big of a push in the eCommerce industry.
Amazon was a titan, and other businesses were slowly opening up online marketplaces.
That all changed with the arrival of the COVID-19 pandemic.
As businesses shut down in-person services, they had to find a way to sell products.
The safest option was eCommerce.
While some businesses supported a hybrid model of having a physical store and an online one, other businesses fully transitioned into having only an online store.
They have an online marketplace where customers can buy what they need and then have their products shipped to them.
With more businesses entering the eCommerce space, the need for cardboard boxes and other paper-based packaging products increased.
That means wood pulp found itself in high demand.
With more people needing it to ship out their products, it meant there was less to go around.
Wood pulp is in high demand, but its supply isn’t always available.
It becomes a matter of who can afford to buy the wood pulp when it’s at its most expensive.
Since manufacturing companies have to pay more for wood pulp, they end up selling their products at higher prices.
This is the case with paper towels.
It costs manufacturing companies more money to produce paper towels because of the increase in demand for wood pulp.
Paper towels are expensive because of the eCommerce industry’s need for cardboard boxes and wood pulp.
7. Seller’s Housing Market
Another reason paper towels are expensive is that it’s a seller’s housing market at the moment.
The COVID-19 pandemic put some money into the hands of people.
With that money, some people found that they had enough to put a down payment on a house.
Sellers were wary of selling their homes during a pandemic, but because they had no choice, they found their homes in high demand.
It ended up being a seller’s market because there were tons of buyers looking to buy a limited number of homes.
A lot of buyers were also looking to buy new construction homes.
These factors contributed to an increase in lumber.
New home buyers wanted to put their newfound money to use.
Some chose to renovate older homes while others pooled their money towards their new construction.
No matter the project, wood was in demand.
This impacted the price of paper towels because it means some manufacturers made the switch to selling lumber.
It was more profitable because it was in such high demand.
Since there was less wood, and thus less wood pulp, to go towards producing paper towels, it meant there were fewer paper towels released to the market.
With demand as high as ever and supply low, paper towels became expensive to buy.
The house-buying spree that occurred during the pandemic is one of the factors that led to expensive paper towel prices.
8. Canadian Tariffs
Foreign factors have also made paper towels expensive.
A lot of wood and wood pulp that the United States gets is from Canada.
Canada has huge forests that it has used to sell lumber, wood pulp, and other wood-based products.
Unfortunately, the United States placed a tariff on the sale of softwood from Canada.
This has made wood more expensive to buy.
When suppliers have to pay more for their wood products, they pass those costs on to the consumer.
The primary reason that the United States placed a tariff against softwood from Canada is that it was interfering with the business of lumber producers in the United States.
Canada was essentially able to sell wood that was lower in value to suppliers in the United States.
Since the Canadian dollar isn’t always valued as high as the American dollar, American suppliers could buy Canadian wood at cheap prices.
This left American softwood suppliers in the cold because they weren’t able to compete with those prices.
Since they’re selling their wood at the American dollar standard, Canadian wood is always going to be cheaper.
It was threatening native suppliers and their ability to do business.
To encourage buyers to buy from American softwood suppliers rather than Canadian ones, they put a tariff on the sale of Canadian softwood.
Anyone who bought Canadian softwood had to do so at more expensive prices.
Unfortunately, the demand for lumber outmatches what American suppliers can provide.
As such, buyers still need to buy from Canadian suppliers.
Since they’re buying at high prices, they have to sell at high prices.
The good news is that there was a recent reduction in the tariff amount.
Although it doesn’t fix the problem entirely, it will likely make Canadian softwood a bit less expensive.
9. Canadian Wildfires
A tariff isn’t the only reason why Canadian softwood is expensive either.
Canada has been the victim of several wildfires that have torn through valuable forests.
With fewer trees to harvest, Canada has had to sell its lumber and wood at higher prices.
Combine that with a tariff, and buyers end up purchasing Canadian wood at a much higher price.
They then turn that into wood pulp which later becomes paper towels.
Since the cost of buying the wood was expensive in the first place, the manufacturer has to raise the price of paper towels to cover the cost and make a profit.
Paper towels are expensive because of the wildfires destroying Canadian softwood trees.
10. Sawmill Worker Shortages
A final reason paper towels are expensive is because of the worker shortages affecting sawmills.
Sawmills are places where logs come in and get cut and turned into pulp or lumber.
Like paper mills, sawmills have also faced worker shortages.
A lack of benefits and inadequate pay are the primary reasons.
This has impacted the price of paper towels because it means the factories aren’t producing as much wood pulp.
With less wood pulp in the market, paper towel manufacturers have to spend more to get the wood pulp that they need, especially with tons of other manufacturers trying to get their hands on wood pulp, too.
With little supply and high demand, the price of wood pulp increases.
This then impacts the price of paper towels because the manufacturer has to raise the price to cover their costs.
Conclusion
Paper towels are a popular item used to clean the house.
Sadly, their price has recently risen largely because of low supply and high demand for the wood pulp used in their manufacturing.
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