Converters begin passing on higher costs to customers

Edited by Natalie Hasselbacher -- Converting Magazine, 7/30/2008 9:48:00 AM

Hit by a steady stream of raw-material price hikes, converters are starting to pass along their rising costs to packaged-goods customers. DuPont Liqui-Box and Amcor Flexibles are among the first major converters to resort to this move.

Flexible-packaging converter DuPont Liqui-Box Corp. announced July 30 that it plans to increase US prices for all of its pre-made dairy, beverage and bulk-food bags. Taking effect Aug. 1, the increases will range from 10 to 25 percent, depending on the product and application. 

According to Roszann Graham, global business director of DuPont Liqui-Box, the company has made substantial improvements in both quality and productivity by means of restructuring and investing in its manufacturing capabilities. “At this time, double-digit cost escalation in raw materials derived from oil as well as rapid increases in energy, transportation and logistics, affecting companies throughout the value chain, are forcing us to make a structural change to our product pricing,” says Graham. “The magnitude of these sustained increases in the cost of petroleum-based raw materials and energy leave us no option but to pass along some of these costs.” 

DuPont Liqui-Box Corp. supplies flex-pack solutions to the food, dairy and beverage industries. The DuPont subsidiary has US facilities located in Worthington, Upper Sandusky and Ashland, OH, and Sacramento, CA.

Amcor Flexibles also said it must raise its prices Aug. 1. Specific percentages were not disclosed. "This follows several months of relentless cost increases from raw-material suppliers based on their climbing feedstock, transportation and energy costs," the converter says in a press release. "While Amcor Flexibles understands how difficult this inflationary environment is for its customers, these extraordinary rises in costs have outstripped the company's ability to keep pace and must be reflected in a product price increase."

Amcor Flexibles has manufacturing operations in 22 countries across Europe and the Americas.