Why are packaging prices going up and delivery times longer?
There are many reasons for this:
- increased transport costs,
- broken supply chains,
- the closure of various branches of the economy by states.
Production of plastics
One of the reasons for the jump in prices is related to the reduced demand for (mainly aviation) fuels, which led many refineries to reduce the scale of production. This resulted in less production of substances that make up plastics. At the same time, the demand for plastic has not decreased, and has been growing steadily since autumn 2020.
The situation is so dramatic that European Plastics Converters (EuPC), an organization of plastics converters, sent a letter to Ursula von der Leyen, head of the European Commission, and Thierry Breton, European Commissioner for the internal market’s list, which describes the great problems with access to plastic and the increasing downtime in supplies.
90% of plastic packaging manufacturers have supply problems. This applies to manufacturers of PET, PE and PP packaging. Producers who use ABP, PVC and PS do not avoid problems.
Even 75% of the packaging price is the price of plastic, so any change is felt almost immediately.
The Packaging Center team tries to keep the prices of our products unchanged. Unfortunately, this is not always possible and the price increase has become visible in our country as well.
Increase in transport prices – reasons
The disorganization of logistics chains has caused a sharp increase in transport costs and significantly extended waiting times. First of all, the lack of containers leaving China is felt, but due to pandemic reasons, they cannot return.
Covid – 19
In recent weeks, there has been an increase in the incidence of COVID-19 in China. First, the deterioration took place in the south
the country, then in the Jiangsu Province, which is important for transport, to discover a new outbreak in Ningbo Port this week. In China, any such case is taken very seriously, mostly closing entire cities / terminals. This, first of all, paralyzes the work of seaports.
July this year was the time when huge floods occurred both in Europe and in China. Unfortunately, they strongly influenced the work of railway terminals on both continents, hindering the efficient rotation of equipment between Asia and Europe. At the same time, also in China itself, many trains did not depart as scheduled and / or had to travel on circular routes.
In this difficult situation, we try to negotiate the best prices with producers and offer our clients the best conditions on the market, but price increases are inevitable. We are also working on a new system that will allow you to minimize package delivery interruptions so that you can have constant access to them.
! Due to the situation, we encourage you to report the need for specific products several months in advance !
The graphic below shows how significantly the prices of transport from China have increased.