A message to our customers
A message to our customers
Recent and rapid developments with regard to raw materials are creating unforeseeable supply challenges that are impacting the packaging industry. BBC CELLPACK Packaging has created this page to share updates with you as the situation progresses.
As always, your BBC CELLPACK Packaging representative is your first point of contact.
If you don’t know who at BBC CELLPACK Packaging to reach out to, please write us an email and we’ll put you in touch with the right person.
Contact: packaging@cellpack.com
Market overview
Since January 2021, significant disruptions in the market due to winter storms, several operational shutdowns and/or reduction of resin production, have led to a supply shortage of all raw materials used to make flexible packaging.
The situation has made headlines in leading business publications, as well as industry media:
https://www.flexpack-europe.org/en/
What does this mean for the production and distribution of our packaging?
This unprecedented situation concerns all our raw material and the situation is continuously evolving.
- Films: the situation remains tense; prices continue to rise and are still subject to change upon delivery.
- Paper: the price of paper pulp has risen sharply to 864.17 euros/ton, i.e. +16.2% since the end of December 2020.
- Waxes and paraffins: We are facing force majeure events, production stoppages and the inability of our suppliers to deliver all of our orders. We are experiencing significant increases and the current movements are expected to continue over the next months into 2021.
- Glues, inks and solvents: follow the same trend. All groups of raw materials such as solvents, polyurethanes, colour pigments and titanium dioxide, binders and additives are affected and have seen increases of between 20 and 50% since last summer.
Transport also affected
In addition to this complex raw material situation, there are significant increases in transport costs, particularly sea freight for raw material shipments. Indeed, the lack of availability has a strong impact on container transport costs. These have been multiplied by 4 from Asia.
What does it mean for me, as a BBC CELLPACK Packaging customer?
We are closely monitoring the situation and working with our suppliers to continue fulfilling our customers' orders.
In this economic context, we are obliged to apply new sales conditions with the following measures:
- Sales prices are reviewed on a case-by-case basis depending on the evolution of raw material prices and transport costs. This may have repercussions on your usual prices.
- Our delivery times cannot be guaranteed.
We invite you to share with our sales teams your supply forecasts over a 3-month period. We can assure you that we are doing our best to try to maintain acceptable lead times and a stable price level.
Our Procurement, Operations and Supply Chain teams are working hard to ensure as little disruption to your packaging supply as possible. Your BBC CELLPACK Packaging contact will keep you up-to-date on the specific implications for your packaging business. As we saw when the COVID pandemic reached Europe almost one year ago, timely and transparent communication between our team and yours will help us all to manage uncertainty and make each other successful during difficult times.
We thank you for your trust and we are convinced that together we can succeed in this difficult period.