Resin Shortage Could Increase Cost of Household Products by 15%

Resins are used worldwide in everyday household plastic products such as diapers, trash bags, beverage bottles, containers for personal care products and detergents, as well as plumbing pipes, medical devices and toys.

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The resin shortage is projected to increase the cost of household goods by 15%, according to a report from AlixPartners. Resins are used worldwide in everyday household plastic products such as diapers, trash bags, beverage bottles, containers for personal care products and detergents, as well as plumbing pipes, medical devices and toys.

“U.S. consumers are already feeling the pinch in their household budgets, and it is likely to get worse before it gets better,” says Marc Iampieri, managing director in the operations and transportation and logistics practices at AlixPartners. “Frankly, this has potential to become a hidden version of the semiconductor crisis for many of the same reasons. Rising demand for plastic products combined with recent supply disruptions has led to complications around quality, cost, and timeliness of delivery. Because these products often have low profit margins, those in the industry have no choice but to pass the higher costs onto consumers. The top priority for companies right now is to mitigate the risk and impact of supply chain disruption, which include building more flexibility into production, rebalancing the supply chain and rethinking delivery and distribution.”

From AlixPartners:

  • Resin processors indicate they will need to downsize operations and minimize future investment. On net, supply is expected to be constrained at elevated prices for the foreseeable future.
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