Why is the price of plastic packaging going up?
1. Plastic packaging with less than 30% recycled content will now include a tax that the UK Government has introduced to incentivise an increase in the amount of plastic that is recycled and reduce the amount of plastic that goes to landfill. This has increased the price for the consumer through the tax for products that do not include the minimum recycled content.
2. The Plastic Packaging Tax has driven massive, increased demand for recycled raw material, creating shortages and inflationary price pressure on reprocessed raw material.
3. The geopolitical situation has meant that the price of oil has increased significantly. Virgin plastic is made from oil, so if the price of oil is increasing, that makes plastic itself more expensive to manufacture, no matter which type of polymer it gets made into.
These 3 inflationary pressures have combined to create a perfect storm to increase the costs of wrapping and securing pallets.