What Factors Will Influence Glass Bottle Availability in 2024?

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Update time : 2024-03-05 09:56:20

Government Duties Threaten Supply Chains

The United States International Trade Commission is likely to add duties to imports from overseas, particularly from Mexico, Chile, and China. This move is anticipated to disrupt supplies and inevitably escalate costs. The potential for increased duties adds an additional layer of complexity to an already intricate global supply chain.

Skyrocketing Freight Costs from Asia

It’s only February, and the freight costs from Asia have already doubled and European prices are beginning to follow suit. The surge is a consequence of a competitive rush to ship stocks to the United States. The heightened demand for imports, coupled with existing supply chain challenges, has led to a significant spike in transportation costs.

Domestic Glass Factories Attempt to Reduce Competition

Duties are a result of a few domestic glass factories suing the US commerce and trade commissions that import pricing is unfair. This is occurring while pricing is increasing on a frequent basis from the domestic suppliers. Not a good visual for an open market economy. In their quest to reduce competition, there will again be a glass shortage as we saw in 2021 and 2022 due to this harsh approach, exacerbating an already turbulent situation.

Understanding the Roots of the Crisis: A Look Back at 2020

In 2021, Global Package President and CEO, Erica Harrop, provided insights into similar challenges faced by the industry. The global labor shortage induced prior duties set in place in mid 2020 along with the pandemic, combined with disruptions in shipping, created a web of bottlenecks affecting every stage of the supply chain. 

The duties introduced in 2020 were over 40%, which combined with the 25% tariffs imposed the year prior caused a significant commotion for glass suppliers.

The demand for consumer goods surged, exacerbating the existing challenges. Rates soared as a result of container shortages, impacting freight costs and delivery timelines. While the 2020 duties were rescinded after a year, the 25% tariffs are still in place today. 

Harrop highlighted the importance of strategic planning and transparent communication during challenging times. “Our financial strength and established long-term relationships with suppliers in China, Europe, and here in the U.S. are enabling us to negotiate these many bottlenecks”. By working closely with reliable suppliers across China and Europe, Global Package initiated alternatives to improve production capacity and mitigate supply chain disruptions.

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