Market Update March 2024

Plastic Prices and Raw Materials 

The global plastic market has been experiencing significant changes, with key materials such as Polyethylene (PE), including both Low-Density Polyethylene (LDPE) and Linear Low-Density Polyethylene (LLDPE), Polypropylene (PP), and other plastics being essential for various applications within the FMCG industry, from packaging to consumer goods. February saw sharp increases in the prices of LLDPE and LDPE, with the trend remaining firm into March. These materials are critical for a wide range of products in the FMCG sector, from packaging to consumer goods. The increases in raw material costs directly impact production costs within the FMCG industry, requiring companies to adapt their strategies, either by absorbing the costs or passing them on to consumers. 

 

Shipping and Supply Chain Challenges 

The FMCG industry is also navigating through increased shipping costs and supply chain challenges. While the situation isn’t as dire as during the COVID-19 pandemic, the industry is feeling the impact of issues such as the Red Sea shipping challenges. To mitigate these challenges, shipping lines have increased their capacity, helping to alleviate some of the pressure on stock costs. However, companies must continue to monitor these developments closely as they can affect delivery times and overall supply chain efficiency. Placing forward orders of your transit packaging will help us to ensure you have the stock when you need it without delays or huge cost increase. Get in touch to place your forward orders.

 

Sustainability and Environmental Impact 

Sustainability remains a key focus within the market, with more and more companies prioritising the use of recycled materials and sourcing plastic-free alternatives such as paper packaging. The FMCG sector is exploring innovative packaging solutions which are made from over 30% recycled materials, in order to pass the UK Plastic Packaging Tax threshold, highlighting the industry’s push towards sustainability. 

Sustainability isn’t just about packaging but includes the entire supply chain, from production to the end consumer. Companies are focusing on reducing their carbon footprint, with significant emissions stemming from supply chains. Addressing these challenges requires a holistic outlook that encompasses environmental, social, and economic factors, aiming for true sustainability. Speak to us today if you would like assistance in approaching the challenge of sustainability across your whole supply chain, and not just your transit packaging. We have worked with multiple companies to successfully reduce carbon footprint, plastic packaging and the sustainability impacts of poor pallet stability.

 

The market is at a critical stage, dealing with the dual challenges of fluctuating plastic prices and the need for greater sustainability alongside shipping and supply chain challenges. Companies are responding by adapting their supply chains, exploring more sustainable materials and practices, and closely monitoring costs to remain competitive. The industry’s ability to innovate and adapt will be key to its continued growth and sustainability in the face of these challenges. 

 

Get in touch if you need help navigating through these market wide issues and trends.