We monitor paper trends and forecasts closely, and the story right now is a familiar one: confirmed cost increases, tightening supply, and the likelihood of additional pricing pressure later this year.
The good news? You can optimize your direct mail budget and improve efficiency through a strong production strategy, early planning, smart postal logistics, and tracking your mail through the postal system.
Recent Paper Cost Increases Are in Effect and May Not Be the Last
Major paper manufacturers including Mativ, Mohawk, Pixelle, Phoenix, and Sylvamo have announced price increases effective February 2026, confirming what many in the industry expected:
Recent supplier partner forecasts indicate increases of 5–8% for:
- Converting papers (including envelope grades)
- Printing papers
- Office papers
While a second increase has not yet been formally announced, many market watchers are advising mailers to budget for an additional 5–8% later in 2026 to avoid surprises.
Why the Paper Market Is Tightening: The UFS Tariff Effect
New tariffs implemented in 2025 have significantly reduced offshore UFS (uncoated free sheet) imports used in many direct mail applications by approximately 35% year-over-year.
Less imported supply means greater reliance on domestic mills, increasing demand pressure and pricing volatility.
This dynamic may continue to influence the market through 2026.
Envelope Costs Rising and Lead Time Remains Volatile
Envelope pricing typically follows paper, and we are beginning to see that pattern emerge again. Lead times have been trending longer than expected depending on production method and volume.
- A 5% paper increase typically translates to 2–2.5% finished envelope cost impact
- Standard envelope lead times are holding around 4–5 weeks
- Flatsheet and convert work may run longer
- Jetting on off-the-shelf inventory is still running about 2 weeks after proof approval
Material delays could affect the production schedule and total package cost, so it’s more important than ever to share creative with production partners for planning.
We will continue monitoring key indicators.
July Postage Rate Increase Confirmed
New postage rates have been confirmed and will go into effect on July 12, 2026. Increases are projected to be:
- NP Marketing Mail Letters: 4.7%
- FC Letters: 4.7%
- NP Marketing Mail Flats: 7% (at least)
- FC Flats: 7% (at least)
Future increases, while limited to once per year, are forecasted to be in the 5-7% range for 2027 and beyond.
How to Survive and Thrive in a Rising Cost Environment
1) USPS Promotions Savings Opportunities
USPS Promotions discounts remain one of the best levers available to offset rising costs. We can help you maximize postal savings by:
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- Being strategic about when promotions are deployed
- Identifying the highest-value promotion opportunities
- Aligning creative and data requirements early
- Ensuring proper registration and documentation
- Coordinating timing around potential mid-year postage rate adjustments
2) Monitor Your Direct Mail Investment with Free Mail Tracking
PMG clients can monitor their direct mail campaigns as they move through the postal system with our free MailTracker service. Mail tracking allows clients to:
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- Monitor mail induction and in-home delivery patterns
- Identify regional delivery variances
- Track return (inbound) mail timing and trends
- Coordinate omnichannel touchpoints
- Manage gift processing facility workflows
- More rigorous reporting and transparency behind the entire direct mail cycle of outbound mail and inbound reply mail
3) Reduce Printing Costs
Locking in pricing where possible
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- Establish annual or semiannual contract pricing with print partners
- Reduce exposure to spot market swings
Improving print efficiency
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- Gang multiple campaigns when timing allows
- Maximize sheet utilization and press efficiency
- Review specs for hidden cost drivers
Leveraging house stock
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- Ask what house sheets are available
- Evaluate acceptable substitutions
- Balance brand requirements with cost flexibility
Review your postal strategy to offset upcoming postage increases
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- Build USPS promotions into campaign planning
- Use commingling and other postal logistics services for better postage savings and more predictable mail delivery
- Make sure your mail piece formats and postage treatments get you the best possible rates
- Investigate whether you qualify for USPS Mail Volume Incentive Program
We’re Here for You
Looking to get the most out of your direct mail production strategy, tactics and budget? We can provide the expert guidance you need on printing, mailing, postage savings, mail tracking and delivery trends, USPS Promotions, and more.
Contact your representative or connect with us here. We look forward to hearing from you!
