Raw material transportation is affected by Covid-19

Flint Group Packaging, a leading supplier of printing consumables and equipment for the global packaging industry, commented on the unprecedented supply chain fluctuations experienced by companies in India, the Middle East and Africa. 

Upal Roy, Managing Director of Packaging India, Middle East and Africa of Flint Group Packaging, said: “It is clear that the global economy is facing tremendous pressure from product shortages. The quantity and prices of global raw materials, as well as the availability of freight, are being severely affected. During the Covid-19 pandemic, the shortage of transportation and raw materials has brought many challenges to the ink and coating manufacturers in our region."

"For various reasons, many key raw materials used in the production of printing inks are facing supply challenges, including vegetable oils and their derivatives, petrochemicals, pigments, and titanium dioxide (TiO2). These products are in short supply, leading suppliers to predict and plan shipments. There is a major problem with capacity."

Due to increased demand in the architectural coatings and wind turbine markets, pigment prices have especially soared recently. Due to the implementation of China's energy conservation plan, the shutdown of Chinese factories has exacerbated the supply and pricing situation. 

For petrochemical products including UV, polyurethane and acrylic resins and solvents, the cost of these materials has been rising since the beginning of 2020, and the demand for some of them has grown beyond normal levels. 

The overall logistics situation is also still difficult. The industry continues to face shortages of steel for barrels and high-density polyethylene (HDPE) raw materials for barrels and kettles. The increase in e-commerce demand has led to a tight supply of corrugated boxes and plug-ins. Material distribution, production delays, raw material force majeure and labor shortages have increased packaging costs. Most importantly, the pandemic has been a catalyst for abnormal consumer buying activities (during and after the shutdown), causing abnormal demand in multiple industries and straining air and sea freight capacity.  

For example, the cost of aviation fuel has increased to 8-10 times the normal level, and the cost of containers has been further exacerbated by unusual shipping schedules and freight carriers stranded or difficult to find a port to unload containers. Ultimately, increased demand and insufficient logistics preparation have led to a severe shortage of freight capacity.

"It is now clear that these supply chain pressures will almost certainly continue until 2022. In addition, we expect container prices, raw material shortages and cost increases to remain high in 2023. Even if some of these constraints are eased and the economic recovery looks forward to the future, There are still uncertainties around the world regarding the return of the coronavirus, changes in consumer buying behavior and potential trade barriers."

"But it is important that all types of printing play an important role in the production of packaging that protects, preserves and supports the transportation of food and other necessities to consumers around the world. The value of printing inks and coatings is obvious. Our Employees are committed to working together to ensure that our customers continue to obtain the ink and coating supplies needed for packaging and printing." 

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