Packaging industry and consumer products companies badly hit

Surging Oil Prices Create Havoc

Surging oil prices have queered the pitch for not only packaging suppliers but all brand owners as well. Not only have they had to bear substantial packaging and transportation cost increases, they have had severe problems passing on any increases to consumers who are already reeling under the impact of double-digit or near double-digit inflation in almost all parts of the world, writes S. Chidambar

August 15, 2008

The surge in crude oil prices has created turmoil in the packaging industry. Oil is a very important input for the industry and impacts it in various ways: It is by far the major source of heat energy for the packaging industry. It is the major feedstock or raw material for a wide variety of materials like polymers and petrochemicals like solvents and other additives. Transportation costs across the entire supply chain have really shot up. This has particularly affected rigid packaging systems which are poor not only on cube utilisation but are also low on transport cost efficiency.

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