What is this?
Many of you have received emails with market updates over the last few months. In an effort to streamline that while expand both the reach and scope of information, I’m starting this newsletter. For many of you, this is completely out of the blue. If this is not welcome, PLEASE feel free to unsubscribe at the bottom of this.
My goal with this newsletter to provide insights that are beneficial to you in your business. Bare with me as this comes together but my thinking is there will be 2-4 “newsletters” per month.
One market update per month (though perhaps two in times like this). One highlighting a new or innovative product in the market. And then one or two others - perhaps touching on industry trends like EPR or a unique case study of sorts.
Again, my goal with this is to simply provide value and insight.
Resin - Are we nearing a ceiling?
Unfortunately, I have no idea. One one hand, the market can only go up so much - largely, this isn’t a supply issue domestically. On the other, the Strait of Hormuz is still closed. Which leads into…..
The resin producers announced another 20 cent/lb increase for May which means we’ve seen 65 cents since the beginning of the year. March and April combined for the largest 2 month increase in history…..until April and May. Barring a substantial change, we will see another 20 cent increase in June as well.
I’m no geopolitical expert but I thought we’d be through this by now. It feels pointless to speculate anymore. This reminds me of the dynamic of two kids — they come to some agreement only for one to mouth off and the other to reply with “screw you, I change my mind.” And the uncertainty continues……
What does this mean by product category?
Stretch Film — Increases have been announced industry-wide now for a 10-15% increase this month. Some more basic or “conventional” films will have gone up 50% give or take since January once this increase comes through.
Poly (bags, tubing, sheeting, etc) — Largely mirrors stretch film. Many stock bags are imported which so far, has actually acted as some sort of insulation against more dramatic movement. So far, we’re looking at a total of no more than 20% for the vast majority of “stock” sizes.
VCI Poly — the amount of the cost associated with the poly is smaller. We’re looking at 20%. 10% last month and 10% hitting late May/early June.
Can Liners — Up 35-40% so far. Another 10% hitting around June 1st.
Tape — so far, not affected as much. Ranging from 4-10% depending on the tape. Though specialty tapes can vary dramatically.
Polyolefin shrink film — 7% in March (largely nixed by FlexPAC). 8% in April. In the midst of another 12% increase right now.
Strapping — Looking at another increase of 5-10% in early June. Moreso on the PP side than PET. Though it’s been like every other month regarding which strap was being hit the most.
Labels — Paper based DT & TT labels are increasing mid/late May. Ranges up to 11.75% but the average is around 7%
Resin based “void fill” — The products primarily affected are foam in place (ie. instapak) and bubble on demand. Impact also varies dramatically by manufacturer with Sealed Air and Pregis the biggest culprits.
Corrugated - why not this too?
Granted, there have been rumors of corrugated increasing since late 2025.
Movement the last few months has been weird. Shockingly, there was a $20/ton decrease in late March. Only to be followed by a $30/ton increase a few weeks later. Late April saw another $20/ton increase for a net of $50. This is in conjunction with rising fuel prices which play a big part in the total cost of corrugated. You can fit maybe $50,000 of poly on a truck but with corrugated, a truck maxes out around $15,000 depending on the item. There just isn’t as much value to spread the extra fuel cost amongst.
All to say, the market is increasing 5.5% to 10%. The higher end feels a tad high for $50/ton but I get it with the fuel prices.
The fuel aspect is significant enough that some plants are pushing fuel surcharges. This is the first I’ve seen that in my 10 years in the industry. For my part, I am largely absorbing this with the hope that this is short lived.
Sooooo, do we throw our hands in the air?!
Giphy
Not necessarily
While none of us can control the cost of raw materials, there are ways to mitigate increases. Innovation continues.
If you haven’t had an outside opinion in a while, there’s no time like the present. Price can only be beat down so much. A stretch film test, pack-out analysis, or redesigning the pack configuration are ways use less material than currently or drive down associated costs like labor.
If you have questions about steps you can take in your business, feel free to reply to this email or book time for a call.
Thanks for reading.
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— Nathan Buell