U.S. Butter Prices Soar 40% y/y on Labour Shortage and Rising Packaging Costs

January 3rd, 2022 IndexBox Leave a comment

IndexBox has just published a new report: ‘U.S. – Butter – Market Analysis, Forecast, Size, Trends and Insights‘. Here is a summary of the report’s key findings.

The average price for Grade AA butter in the U.S. amounted to $2.02 per pound on December 11, 2021, increasing by 40% from the same period last year. Reducing milk cow herd, labour shortage, and the rising packaging materials costs constrain production growth, leading to insufficient supply in the market that results in the butter price surge. Demand for butter typically picks in Q4, when Americans consume more holiday cookies and other traditional dishes. In December, butter prices picked up 3.7% compared to the figures a month earlier.

According to recent USDA data, prices for Grade AA butter averaged $2.02 per pound for the week ending December 11, 2021, a 40%-increase compared to December 2020. The main reason for that spike was the insufficient supply owing to the reducing milk cow herd and the labour shortage. Over January-October 2021, total butter production reduced by 11% to 1.6M lb against the figures of the same period last year. The rising cost of packaging materials also contributes to higher butter prices. Over the past month, butter prices rose 3.7%, driven by strong seasonal demand. The current challenges are expected to persist in the following year, and butter prices will climb further.

US Butter Imports in 2020

Last year, approx. 33K tonnes of butter were imported into the U.S., waning by -23.9% against 2019. In value terms, the purchases declined to $277M (IndexBox estimates).

Ireland (25K tonnes) constituted the largest butter supplier to the U.S., accounting for a 77% share of total volume. Moreover, butter imports from Ireland exceeded the figures recorded by the second-largest supplier, New Zealand (3.1K tonnes), eightfold. The third position in this ranking was occupied by France (1.4K tonnes), with a 4.1% share.

In value terms, Ireland ($222M) constituted the largest butter supplier to the U.S., comprising 80% of total imports. The second position in the ranking was occupied by New Zealand ($19M), with a 7% share of total imports. It was followed by France, with a 4.8% share.

In 2020, the average annual growth rate of value from Ireland stood at +1.4%. The remaining supplying countries recorded the following average annual rates of imports growth: New Zealand (-18.6% per year) and France (-8.2% per year).

Source: IndexBox Platform

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Parcel Packaging Tips: All You Need to Know

August 4th, 2021 SlideHunter Leave a comment

With the COVID-19 outbreak, people are pushed to shop online. It’s great for business owners that their business is still growing. While shipping companies also benefit from this, there are also downfalls.

According to Route’s data, there is a 19.1% increase of items that were damaged during delivery in 2020. No one wants to receive damaged items. When they do, customers either blame the seller or the courier company for it. And sometimes, they blame both.

Parcels can be damaged due to plenty of reasons. While this is true, you should still take an extra step to ensure the safety of the item before it is delivered. That’s why we have here some parcel packaging tips to prevent damaging the items during delivery.

Why is Packaging Important?

Some customers use a parcel delivery box to protect their packages, especially when no one is at home to receive them. You can easily detect these parcel boxes. Usually, they are installed near the owners’ porches, gateposts, or driveways.

Additionally, these drop boxes are made from steels that are weatherproof. This feature guarantees that the parcels are safe inside. Items can be placed at the top part of the box. Closing the hatch will trigger the parcel to slide down to the cabinet. For extra safety, the cabinet has a safety lock that can only be accessed through a key.

With these delivery boxes, buyers can receive their parcels safely.

But that is to say that every customer doesn’t have a parcel drop box at their homes. When you’re delivering an item, it’s hard to assume you can safely leave the parcel at their doors. Additionally, items for delivery have a long way to go before they get to the customers. You should make sure that there are no damages to the items when they reach the customer.

That’s why good packaging is important. Customers don’t want to receive damaged or incomplete items. When they do, sometimes the courier company takes the blame for it. Bad reviews mean you lose potential clients to avail of your shipping services. Customer satisfaction is a top priority, especially for shipping companies.

Learning how to package the items properly helps in improving the shipping process of the company. It not only makes your customers happy, but it also allows them to continue availing themselves of your services.

What are the Types of Packaging Materials?

Before we discuss parcel packaging tips, it’s important that you know what types of packaging materials are used. Don’t worry, there are only two of them.

External Packaging

Corrugated packaging material is often used for heavy items such as appliances. On the other hand, lightweight items can be put in flyer bags. These bags can only carry products with 4kg of weight and below.

Internal Packaging

Internal packaging is materials that are used to cushion the items inside the box. They provide additional protection for shock absorption. These materials can include bubble wrap, cardboard, airbags, crumpled paper, styrofoam, and foam pellets.

Parcel Packaging: Tips for Couriers

A courier’s job is not only limited to distributing parcels to their respective buyers. Couriers are also expected to deliver the items undamaged and without delays. Because of this, the packaging of items is an essential part of making deliveries.

In order to prevent damages to the products you will deliver, you should consider these packaging tips. These tips also help you provide high-quality service to your customers.

Consider the Hazards of Delivering the Parcels

Before you wrap the items, you need to consider first the possible scenarios when the parcel is in transit. These hazards are unavoidable. This means that there’s nothing you can do to stop them from happening. What you can do, though, is to prepare for when they happen to prevent damage to the items.

There are numerous factors that can affect the parcels when they are out for delivery. First and foremost, you have to understand that the road is not always smooth. There will be bumps along the way. Because of this, packages tend to collide. And when this happens, punctures, abrasions, and shocks occur.

For this matter, you should make sure that the internal packaging of the parcels is enough to cushion the items.

Another risk is exposure to different temperatures. When the weather is too hot, remember to use shrink packaging material to combat the heat. This kind of packaging material can withstand 30 – 77 degrees Fahrenheit.

What it does is that when heat is applied to items with shrink packaging, the shrink wrap tightens around the item. This also protects the items from dust and moisture, and some even have UV protection features.

Be Aware of the Items You’re Shipping

It’s important that you are aware of the kind of item you are going to deliver. Some items such as fragile items require extra care to avoid mishandling them. When you’re packing an item for delivery, be sure to keep in mind the size, weight, and value of the product.

Weight

The weight of the product determines what type of packaging material will be used. You should use a stronger packaging material when you’re wrapping up heavy products. The strength of the box is usually found on the manufacturer’s stamp.

A double or triple-layered corrugated cardboard box can accommodate heavier items. A polyurethane bag, however, can be used to pack lighter products.

Size

77% of customers said in a 2020 survey that the size of boxes relative to the size of the product is important. This is because they wanted to reduce the impact of packaging on the environment. That’s why you should measure the exact size of the item before you put it in their respective box.

Value

You should know if the items you’re shipping are of high value. Usually, these products are identified as fragile. You can check in the special instructions if the client indicated the fragility of the items. Shipping high-value products can be tricky and require extra precaution.

When you’re packing fragile items, you can use two boxes for extra protection. One box would fit the item and another larger box that can fit the first box. Also, don’t forget about the internal packaging to cushion the item. This will prevent the items from shifting inside the box, reducing the risk of damaging the items.

Don’t Forget to Fill Empty Spaces Inside the Parcel

Fillers or internal packaging is an important aspect of parcel packaging. When you don’t have enough filler material in your packaging, your items will shift inside the box. This can cause damage to the items. While this is true, overfilling a box can cause it to burst in the middle of delivery.

Manage the right amount of fillers that you put inside the box. When choosing the size of the box to use for the items, don’t forget about the space for the fillers. You should allocate at least 2 inches (5 – 6 cm) of space for the fillers. The type of fillers you can use include:

-Bubble wrap

-Foams

-Cardboard

-Paper

-Airbags

-Packing peanuts, and

-Styrofoam

Separate the Items

Items should be packaged separately. When you put multiple items inside a single package, chances are they will bump into each other, damaging both items. That’s why separating them into multiple packages is the best way to prevent this.

Make Sure to Seal the Parcel Properly

Different types of items need different kinds of seals. For example, boxes can be sealed with 2-inch (5cm) tape. Whereas polyurethane bags have their own adhesive tape to seal light items such as T-shirts.

When you’re using a polyurethane bag, make sure that you have sealed it properly. Sometimes, the tape opens up in the middle of delivery. When this happens, any form of liquid can enter the package and damage the items inside.

On another note, you should avoid using straps and strings. These types of seals can cause compressions, which can damage the product inside the box.

One of the most common sealing methods is the three-strip sealing method or the H taping method. This type of sealing method keeps the flap on the boxes closed during delivery, which prevents goods from accidentally opening.

It is a fairly easy step that only requires applying enough strips of tape to the center and edge seams of the box. Don’t forget that heavier items require extra tape to keep their seams tight.

And, that’s it! The box is secure and ready for transit.

Conclusion

The pandemic may have increased online shoppers, but it also opened up new challenges for shipping companies. One of the challenges is to deliver the packages safely and unharmed. Appropriate packaging is an important part of a courier’s job and should not be taken for granted.

Shipping companies should take the extra mile to overcome these problems. Their main goal, still, is to continue being competitive in the shipping industry despite the recent pandemic.

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Easy Peel Film Packaging Demand Expands Across Food and Beverage Sector

June 9th, 2021 Global Market Insights Leave a comment

The easy peel film packaging market is witnessing significant growth due to persistent demand for easy-to-use, cost-effective durable, eco-friendly, and moisture & water-resistant packaging solutions in various end-use industries such as pharmaceutical, food & beverage, and others. In the food & beverage industry, easy peel film finds applications in the packaging of many processed or ready-made food products such as tofu, jellies, butter, yogurt, muffins, cakes, and others.

Growing consumer inclination towards packaged food products in developed, as well as developing countries, is expected to augment the demand for food-grade easy peel films. Seafood is a commonly consumed product across various nations, where the packaging can help deliver quality products to consumers.

As per the U.S. Department of Agriculture (USDA), consumers, businesses, and government entities in the United States had combined spent almost US$1.77 trillion on food & beverages in grocery and retailer shops in 2019. This expenditure on packaged food products is likely to increase further, owing to the rising health concerns amid the COVID-19 outbreak.

Easy peel film packaging solutions provide a robust barrier to dust, moisture, and other harmful impurities present in the environment and help in increasing product shelf life. Polyethylene (PE), polyethylene terephthalate (PET), cast polypropylene (CPP), and polyester & laminated material are the prominent easy peel film packaging materials. Polyethylene (PE) film offers high strength, gas permeability, easy acquisition, and low-cost benefits due to which the material is chiefly used in packaging solutions for fruits and vegetables.

The growing trade of fruits and vegetables mainly in developed regions should increase PE film demand to a large extent. According to Global Market Insights, Inc., the global easy peel film packaging market size is predicted to expand at a notable rate through 2027.

As per the Ministry of Foreign Affairs (CBI), the European imports of processed fruits and vegetables were recorded at 24 million tons in 2019.

The easy peel film packaging products with respect to transparency are categorized as transparent and opaque. Opaque films are becoming key packaging material for e-commerce businesses. Opaque films eliminate the utilization of bulky packages and other packaging materials such as fillers and tapes, which further helps in reducing shipping costs.

Growing R&D expenditure by prominent industry players could create lucrative growth opportunities for the easy peel film market and new product development. For instance, Berry Global Group, Inc. has recently announced an investment of over US$70 million to support ongoing developments in consumer packaging films primarily for food & beverage and e-commerce applications.

North America’s easy peel film packaging industry is predicted to witness substantial growth, owing to the high demand for packaged and processed food products among consumers. Significant rise in per capita income and increasing health awareness due to escalating viral infections such as coronavirus have urged Americans to adopt packaged food products for better hygiene, rather and outdoor dining. Moreover, increasing preference towards nutritional supplements and bakery & confectionery products is expected to complement the regional industry landscape.

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Rising Paper Packaging Demand to Mitigate Adverse Pandemic Impact on the Global Pulp Market

April 8th, 2021 IndexBox Leave a comment

Because of the pandemic-related shifts in downstream industries, pulp manufacturers are forced to adjust their market strategies towards the rapid increase in packaging paper use. In the medium term, value chain sustainability emerges as the most important factor due to the tightening of environmental regulation.

According to a new report by IndexBox, the global wood pulp market is estimated at $132.7B. Chemical wood pulp (148M tonnes) constituted the product with the highest consumption, accounting for 77% of the total volume. Moreover, chemical wood pulp exceeded the figures recorded for the second-largest type, mechanical wood pulp (24M tonnes), sixfold. Semi-chemical wood pulp (11M tonnes) ranked third, with a 5.9% share.

The COVID crisis became an ordeal for the paper industry. A decline in the demand for printing and writing paper due to the digital transformation has intensified further because exhibitions, conferences, advertising, and education migrated online during the pandemic.

Considering a significant part of the population started to work from home, and cloud technologies became a must-have tool, it leaves no chances for a considerable printing paper market growth even after overcoming the COVID crisis.

In contrast to the decline in the demand for paper supplies for offices, schools, and restaurants in 2020, the demand for paper for households’ needs – toilet paper, napkins – soared in 2020. During the pandemic, the surge in e-commerce has pushed plants producing corrugated boards and paper packaging to operate at full capacity. The lack of supply of cardboard packaging has led to higher prices for cardboard in 2020. Pulp producers are set to adjust their market strategies to the paper and paperboard mill industries’ shifts.

While Paper Packaging Segment Drives Market Growth, Supply Chain Sustainability Becomes Vital

The countries with the highest volumes of wood pulp consumption in 2019 were the U.S. (51M tonnes), China (39M tonnes), and Japan (10M tonnes), together accounting for 52% of global consumption. These countries were followed by Canada, Sweden, Russia, Finland, Brazil, Germany, India, Indonesia, Italy, and France, which accounted for a further 31%.

From 2012 to 2019, the most notable rate of growth in terms of wood pulp demand, amongst the leading consuming countries, was attained by India (with a CAGR of +6.2%), China (+6.1%), and Russia (+4.1%), while wood pulp consumption for the other global leaders experienced more modest or even slightly negative paces of growth.

In the medium term, the demand for paper packaging is expected to grow steadily worldwide, given that paper is an environmentally friendly, biodegradable, and recyclable material. This is facilitated by adopting new legislation in the EU and other countries, the US re-entering the Paris Agreement, and the intensification of international efforts to preserve the climate.

According to the EU packaging-related regulation, by 2030, at least 85% by weight of all paper and cardboard packaging waste must be recycled. In 2019, in the EU, the share of secondary raw materials in paper production was 49%, while the share of wood pulp was 41%. This makes the paper value chain‘s sustainability the key factor for the industry in the future, meaning the increased use of recycled raw materials and decreasing energy consumption.

China to Remain the Major Importer of Wood Pulp

Global wood pulp imports stood at 64M tonnes in 2019. In value terms, wood pulp imports reached $45.4B (IndexBox estimates) in 2019. In March 2020, the lockdown led to a sharp drop in global imports of wood pulp by 10% in physical terms compared to April 2020, which was 30% lower than in March 2019. By May 2020, it dropped deeper, amounting to only 60% against May 2019. Afterward, there was a recovery attempt, but during 2020 global pulp imports failed to regain 2019 levels, largely attributed to reduced global printing paper use.

In 2019, China (24M tonnes) represented the major importer of wood pulp, constituting 37% of total imports. From 2012 to 2019, the average annual growth rates concerning wood pulp imports into China stood at +5.9%. At the same time, India (+9.4%), Turkey (+6.5%), Poland (+6.3%), Spain (+3.4%), Indonesia (+1.7%), the Netherlands (+1.6%), the U.S. (+1.5%) and Italy (+1.3%) displayed positive paces of growth.

India emerged as the fastest-growing importer imported globally, with a CAGR of +9.4% from 2012-2019. Germany, Japan, and South Korea experienced a relatively flat trend pattern. By contrast, France (-2.0%) illustrated a downward trend over the same period. In 2020, China should maintain its leading position in terms of imports because rapid urbanization and income growth promote packaging and household paper use in the country.

In value terms, China ($18.8B) constitutes the largest market for imported wood pulp worldwide, comprising 41% of global imports. The second position in the ranking was occupied by the U.S. ($3.3B), with a 7.2% share of global imports. It was followed by Germany, with a 6.5% share.

Source: IndexBox AI Platform

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China’s Packaging Materials Market Is Slowing Down Due to Weak Demand

November 7th, 2019 IndexBox Leave a comment

IndexBox has just published a new report: ‘China – Packaging Materials – Market Analysis, Forecast, Size, Trends and Insights’. Here is a summary of the report’s key findings.

The revenue of the packaging materials market in China amounted to $69B in 2018, going down by -6.1% against the previous year. This figure reflects the total revenues of producers and importers (excluding logistics costs, retail marketing costs, and retailers’ margins, which will be included in the final consumer price). Over the period under review, the total market indicated buoyant growth from 2008 to 2018: its value increased at an average annual rate of +2.5% over the last decade. The trend pattern, however, indicated some noticeable fluctuations being recorded throughout the analyzed period.

Based on 2018 figures, packaging materials consumption increased by +17.4% against 2016 indices. The pace of growth appeared the most rapid in 2017 when the market value increased by 25% year-to-year. In that year, the packaging materials market reached its peak level of $73.5B, and then declined slightly in the following year.

Production in China

Packaging materials production in China totaled 63M tonnes in 2018, waning by -8.3% against the previous year. The total output volume increased at an average annual rate of +2.9% over the period from 2008 to 2018; however, the trend pattern indicated some noticeable fluctuations being recorded over the period under review. The pace of growth appeared the most rapid in 2009 with an increase of 9.3% against the previous year. Over the period under review, packaging materials production attained its maximum volume at 69M tonnes in 2017, and then declined slightly in the following year.

In value terms, packaging materials production stood at $73.1B in 2018 estimated in export prices. In general, the total output indicated a buoyant increase from 2008 to 2018: its value increased at an average annual rate of +2.9% over the last decade. The trend pattern, however, indicated some noticeable fluctuations being recorded throughout the analyzed period. Based on 2018 figures, packaging materials production increased by +24.2% against 2016 indices. The pace of growth was the most pronounced in 2017 when production volume increased by 32% year-to-year. In that year, packaging materials production reached its peak level of $77.5B, and then declined slightly in the following year.

Exports from China

In 2018, the exports of packaging materials from China stood at 2.9M tonnes, going up by 4.7% against the previous year. Overall, packaging materials exports continue to indicate a buoyant expansion. The pace of growth was the most pronounced in 2014 with an increase of 33% year-to-year. Over the period under review, packaging materials exports attained their maximum at 2.9M tonnes in 2016; however, from 2017 to 2018, exports remained at a lower figure.

In value terms, packaging materials exports stood at $3.1B (IndexBox estimates) in 2018. Overall, packaging materials exports continue to indicate a buoyant increase. The most prominent rate of growth was recorded in 2014 with an increase of 36% y-o-y. Exports peaked in 2018 and are likely to continue its growth in the immediate term.

Exports by Country

Viet Nam (183K tonnes), Iran (136K tonnes) and Bangladesh (127K tonnes) were the main destinations of packaging materials exports from China, together accounting for 16% of total exports.

From 2008 to 2018, the most notable rate of growth in terms of exports, amongst the main countries of destination, was attained by Bangladesh, while the other leaders experienced more modest paces of growth.

In value terms, Viet Nam ($223M), the U.S. ($158M) and Iran ($118M) appeared to be the largest markets for packaging materials exported from China worldwide, together accounting for 16% of total exports.

Among the main countries of destination, Viet Nam experienced the highest growth rate of exports, over the last decade, while the other leaders experienced more modest paces of growth.

Export Prices by Country

In 2018, the average packaging materials export price amounted to $1,073 per tonne, surging by 4.2% against the previous year. Over the period from 2008 to 2018, it increased at an average annual rate of +1.9%. The most prominent rate of growth was recorded in 2011 when the average export price increased by 11% against the previous year. The export price peaked at $1,145 per tonne in 2012; however, from 2013 to 2018, export prices remained at a lower figure.

There were significant differences in the average prices for the major foreign markets. In 2018, the country with the highest price was India ($1,471 per tonne), while the average price for exports to Bangladesh ($788 per tonne) was amongst the lowest.

From 2008 to 2018, the most notable rate of growth in terms of prices was recorded for supplies to India, while the prices for the other major destinations experienced more modest paces of growth.

Imports into China

Packaging materials imports into China totaled 2.3M tonnes in 2018, picking up by 3.4% against the previous year. Over the period under review, packaging materials imports continue to indicate a relatively flat trend pattern. The most prominent rate of growth was recorded in 2017 when imports increased by 13% against the previous year. Over the period under review, packaging materials imports reached their peak figure in 2018 and are expected to retain its growth in the immediate term.

In value terms, packaging materials imports amounted to $2.2B (IndexBox estimates) in 2018. The total import value increased at an average annual rate of +1.6% from 2008 to 2018; the trend pattern remained consistent, with somewhat noticeable fluctuations being recorded throughout the analyzed period. The pace of growth was the most pronounced in 2011 when imports increased by 15% y-o-y. In that year, packaging materials imports attained their peak of $2.3B. From 2012 to 2018, the growth of packaging materials imports remained at a lower figure.

Imports by Country

The U.S. (422K tonnes), Sweden (309K tonnes) and Taiwan, Chinese (168K tonnes) were the main suppliers of packaging materials imports to China, together comprising 39% of total imports. These countries were followed by Indonesia, Russia, Australia, Japan, Brazil, Finland, Canada, South Korea and New Zealand, which together accounted for a further 37%.

From 2008 to 2018, the most notable rate of growth in terms of imports, amongst the main suppliers, was attained by Canada, while the other leaders experienced more modest paces of growth.

In value terms, the largest packaging materials suppliers to China were the U.S. ($390M), Sweden ($293M) and Japan ($146M), together accounting for 37% of total imports. Taiwan, Chinese, Russia, Australia, Indonesia, Brazil, Finland, South Korea, Canada and New Zealand lagged somewhat behind, together comprising a further 33%.

In terms of the main suppliers, Canada experienced the highest rates of growth with regard to imports, over the last decade, while the other leaders experienced more modest paces of growth.

Import Prices by Country

The average packaging materials import price stood at $982 per tonne in 2018, remaining relatively unchanged against the previous year. Over the last decade, it increased at an average annual rate of +1.1%. The growth pace was the most rapid in 2010 an increase of 15% year-to-year. The import price peaked at $1,120 per tonne in 2014; however, from 2015 to 2018, import prices stood at a somewhat lower figure.

There were significant differences in the average prices amongst the major supplying countries. In 2018, the country with the highest price was Japan ($1,286 per tonne), while the price for Indonesia ($630 per tonne) was amongst the lowest.

From 2008 to 2018, the most notable rate of growth in terms of prices was attained by Australia, while the prices for the other major suppliers experieznced more modest paces of growth.