Product-to-Market Factors
SUMMARY: Lower and stable material and logistics costs after unprecedented peaks in ’21 and ‘22.
Paper costs have increased in 2023 driven by sanctions on Russian paper (Ukraine) and constrained supply contributed to by 4 paper mill closures since start of Q4 2022. Major pulp sector meetings in China at the end of March may spur a downward trend as mills confront strong customer demand for lower prices. (Fastmarkets RISI)
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Natural rubber and poly costs for glove making increased mildly in February, stabilizing in March.
Plastic material costs were mixed through Q1 of ‘23. PET climbed 20% after two-year lows that peaked in December while index prices for HDPE, LDPE and LLDPE all increased January - March after Q4 ’22 declines.
Fastmarkets RISI Ocean freight expense has receded completely from pandemic supply chain crisis highs, with the Drewy Composite Index for 40’ containers on all routes at $1,917 as Q1 ends. (Drewry)
First quarter North American truck shipping rates fell nearly 30% versus prior year. (DAT, Supply Chain Dive)
Q2 2023 Market Update
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