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Supply chain disruptions drive up prices of European flexible packaging materials in first quarter of 2024

Shipping disruptions in the Red Sea have had a significant impact on supply chains, leading to increased prices of European flexible packaging materials in the first quarter of the year.

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Prices of flexible packaging materials in Europe steady on high levels in Q4 2023

Although destocking ends in Q4 2023 demand is stabilising in 2024. The final three
months of 2023 saw a mixed set of results in prices for the basket of flexible packaging
materials used to assess markets across Europe.

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European Parliament improves rules on packaging recyclability but takes a risky bet on recycled plastic content

Today, the European Parliament adopted its negotiating position on the Commission proposal for a Regulation on Packaging and Packaging Waste (PPWR). “This represents an important and long-awaited step forward in the legislative process which gets us closer to finalizing a text that will change the future of the way we package products for decades to come” states Guido Aufdemkamp, Executive Director of Flexible Packaging Europe.

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Prices for Flexible Packaging materials have passed their peak but remain above their long-term trends

Having peaked midway through 2022 the basket of flexible packaging materials used to measure price levels have continued to decline in Q3 2023, following the trend seen in the first half of the year. While they are all still above the benchmark price set in Q4 2020 (100%) most have dropped by about 10% to 20% since the previous quarter, according to figures recently released by Flexible Packaging Europe (FPE).

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Whilst Flexible packaging material prices ease from recent highs, they remain well above 2020 levels

Following the first signs of cooling prices for flexible packaging materials seen at the end of 2022, the first quarter of 2023 saw a drop across the basket of materials, with only aluminium foil ticking up further (from 179% to 187% v Q4 2020)* due to higher conversion costs.

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Last quarter of 2022 sees only slight relief in prices for flexible packaging materials

The last three months of 2022 saw declines in the price of some flexible packaging materials, as demand stabilised amid continued uncertainty about the global economic outlook and energy costs. After the peaks mid of 2022, most substrate prices registered single digit declines, according to figures released recently by Flexible Packaging Europe (FPE).

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