The “perfect storm” of logistics and raw materials also overwhelms fruit and vegetables. The boom in the costs of the main commodities , the difficulties and higher costs associated with transport – by sea but not only -, the imbalance between an inadequate supply to demand are putting a strain on the protagonists of the segments involved and the entire chain of fresh products. . Italiafruit News has heard some of the main operators for an investigation that will continue in the coming days. In the meantime, here is a first, full-bodied “taste”.
Plastic packaging: the effort to contain the increases
“I had never seen, in so many years in this sector, a situation of such sudden, important and generalized increases for all products, from cardboard to plastic, from greenhouse iron to wood: the price of all materials has literally exploded” , the comment of Fabio Zoboli, commercial director of the Infia group . “Added to this is the large increase in the cost of transport, especially by sea, for which for months there has been the problem of the lack of ships and containers , so much so that on many routes the costs have taken off:
in California or South America costs the double over last year, while reaching theMiddle East with containers weighs 40-50% more in economic terms. And we fear that in the second half of the year the costs for overseas traffic may further increase “.
” Furthermore, as an effect of Brexit – adds Zoboli – we are encountering great difficulties in finding trucks to return to Great Britain. In fact, it seems that the same has greatly reduced exports to the European Union”. For some months now, a strong imbalance between supply and demand has been created on plastics , with consequent increases:
“The increases in our price lists were on average between 15% and 25% compared to last year , percentages that have only partially compensated for this difficult situation ”comments Zoboli. “On the other hand, the data speak for themselves: since June 2020 the price list of polypropylene granules has risen by 90% , that of recycled Pet by over 40% . At the moment, all the signs confirm that this trend will continue for several more months ”.
“As for the different materials, supermarkets have become aware that non-transparent packaging reduces sales ; the consumer, by buying a” live “product, wants to see what he or she buys and plastic remains the best answer to this need. . There is an increasing demand from consumers and, consequently, from large-scale distribution to use recycled and recyclable packaging , and Pet is the only material that can be recycled back into contact with food “, emphasizes Zoboli.
“By now there is the awareness that primary packaging is essential, as well as to sell fruit, to avoid waste. And in order to minimize the environmental impact, an approach directed towards a circular economy is, at the moment, the only possible answer “.
” Many large-scale distribution chains – concludes the Infia manager – are already beginning to push in this direction: we ask to use a recycled raw material that can be further recycled and re-used to produce the same packaging. In this way, natural resources are not consumed and, above all, a virtuous circle is created, creating an economic value for the recovered waste. Paradoxically, at this moment, due to the great demand for recycled raw material, we find ourselves in a situation where recycled Pet costs more than virgin : in short, it is good from an environmental point of view, less from an economic point of view … “.
The leap of paper and the fallout on corrugated cardboard
From September 2020 to today, the cost of paper has increased on average by 50%, with much higher peaks for certain types of products such as cover papers for making quality prints. Significant increases that, as explained to Italiafruit News by Claudio Dall’Agata, director of Bestack (Consortium of producers of corrugated cardboard packaging for fruit and vegetables), “puts our sector in great difficulty, in contact with a supply chain, such as fruit and vegetables, which struggles to reverse the increases in raw materials on the market. The price of the raw material today accounts for more than half of the total cost of the box “.
Corrugated cardboard packaging is made up of different types of paper: two covers, functional for printing; two waves, aimed at guaranteeing resistance; and a tense placed between the waves. For fruit and vegetable goods, mostly virgin papers are used (99.8% of Bestack papers are certified with forest certification).
“In Italy there are no cellulose conifer plantations and, therefore, the corrugated cardboard sector for fruit and vegetables is profoundly dependent on foreign paper. We import it mainly from the Scandinavian Peninsula and the United States and, in part, from Poland and Austria. the problem is not only the significant increase in costs, but also the lack of availability: the raw material is hard to find, so much so that today there are companies waiting for the reels in the yards. “In anticipation, according to Dall’Agata, the costs paper will increase again until September; then the world economic picture could change profoundly and at that point we will know more.
Wood, the woodworm of rising prices favors local producers
The increase in the cost of raw materials also affects wood and all its derivatives, primarily the pallet. The latter represents the main element of world logistic traffic and is essential for all sectors, including fruit and vegetables. “A year ago a cubic meter of imported wood cost 180 euros , today 420 euros. For this reason, since the beginning of 2021 we have reduced imports and favored the Trentino and Veneto sawmills, which now have a huge margin of remuneration and a unique opportunity to compete on the market “: so Primo Barzoni, CEO of Palm Spa , commented the market situation to Italiafruit News.
The raw material wood is therefore at a standstill: purchases from abroad inevitably drop and this could prove to be a good lever to favor local economies. “The great production cycles of the past are no longer carried out – continues Barzoni – which are ‘broken up’ and decrease in volume. All orders have been rationalized and the supply chain is almost blocked. Before delivering, we reason with customers on how to compensate for over-packaging and cope with the shortage of raw materials ”.
Beyond the current problem, the CEO of Palm invites us to reflect on what has become a “structural situation”, in which the demand for raw materials exceeds the capacity to produce them. “Not only resilient but anti-fragile and socially responsible economies must be created – concludes Barzoni – in which all the actors work in transparency, returning to enhance local supply chains”.
The (big) producer point of view: we are the weak link
For the operational director of Apofruit Italia, Claudio Magnani, “production is the part of the supply chain that risks paying the highest price due to the increase in raw materials: our products are subjected daily to market risk linked to the variability of the price lists. “.
“What has arisen is a situation that has never been seen in many years, ” he adds. “The pandemic year has changed the paradigms, it has certainly influenced the flare-up of prices , even if the reasons are difficult to understand. The fact remains that between the end of last year and the beginning of 2021 there was the start of a process that generated a strong increase in raw materials, costs related to packaging, logistics, not to mention energy. electricity and fuel . And some products, such as wood, are difficult to find: we experience maximum uncertainty in delivery times “.
But how will the situation evolve? “Forecasts are difficult to make, it is a bit like trying to get the trend of the stock exchange right”, concludes the operations director of Apofruit. “We manage the price lists in the short term, hoping that the conditions will change as soon as possible for an improvement”.