The Market for Resins is Disrupting FIBC Prices

The Market for Resins is Disrupting FIBC Prices

It’s no secret that global supply chains are currently facing unprecedented strain. It seems like every day we are seeing news about process increases or shortages of key products ranging from lumber and building materials to cars and trucks. The bulk bag industry has not escaped the current supply chain crisis unscathed. FIBC orders are facing significant delays, with lead times longer than any in recent memory. As stock becomes increasingly harder to come by, bulk bag prices have also seen a significant jump.

While the common factors impacting the supply chain, including increased fuel and shipping costs, have led to the rising costs of bulk bags, another surprising factor has impacted supplies – the increased demand for resin across multiple industries. How has the increased market for resin disrupted FIBC prices? Let’s explore the reasons behind this changing market trend.


Resin's Key Role as a Manufacturing Material

Resins are used in a surprisingly large number of manufacturing processes. In the FIBC bag industry, resins are added to woven polypropylene to bind the fibers together and create a lightweight strong material.

However, the same resins used in the bag manufacturing are also critical components in the manufacture of a wide range of other products and goods, including:

  • Electronics
  • Construction materials
  • Paints
  • Many types of plastics

Due to their flexibility and use in so many different applications, resins are always in high demand. However, recent events have led to a major shortage in available resin supply.


The Cause of Resin Shortages - COVID-19 and Southern Ice Storms

As with most industries, the pandemic hit the resin market hard, and continues to do so. Even today, factories dedicated to developing key chemicals used to manufacture resin products have yet to return to peak production. Many such businesses have yet to ramp up production enough to even address the back log of orders, much less create available stock.

The pandemic is not the only factor leading to the shortage of resin products. The recent ice storms across the southern United States crippled resin manufacturing operations in Texas, one of the biggest producers of resins in the country and across the globe.


Limiting the Impact of Increased FIBC Prices

While it’s certainly true that FIBCs have risen in cost due to the resin shortage, there are steps you can take to mitigate the impact of these additional expenses. To limit the impact of increased prices, be sure to:

  • Plan ahead: Giving yourself extra time to source your bags is critical during this trying time. Do your best to predict your FIBC needs well in advance and place your orders with vendors long before the units are needed. This will help to reduce the pressure resulting from long lead times.
  • Buy in bulk: Whenever possible, buy the largest quantity of bags that you can – within reason of course. Stockpiling your supply can help you avoid further increases in process, and eliminate delays related to backordered materials.
  • Explore alternatives: Depending upon your unique application, it may be possible to substitute a different bag than you normally might use. For example, using a generic stock bag in place of a custom bag may be less expensive and easier to do during the current supply chain challenges.
  • Talk to your distributor: Understanding the complexities of today’s market and the steps you can take to protect your business isn’t always easy. Take the time to talk to your distributor about the best strategies you can take to keep your operations running at full speed despite the resin shortage and rising FIBC costs.

National Bulk Bag is here to help you limit the impact of increased bulk bag prices. Call us today to speak to an expert about the best steps you can take to limit your costs and frustrations related to long lead times.



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June 14, 2021

Categories: Bulk Bags

About the Author: Janette Lais

Janette is the Director of sourcing for National Bulk bag. Janette is also a graduate of the University of Minnesota in Minneapolis. Janette has been in the packaging industry since 2004 and has held many roles such as Operations and purchasing manager, Purchasing management project manager. Before entering the packaging industry, Janette spends 19 years at a manufacturing facility where she held production scheduling, product manager, and purchasing manager position. Janette is an outdoor enthusiast and enjoys hiking and fishing in her free time. She also enjoys spending time with family and friends and her three dogs.

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