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Saxco Update - May 2025: Tariff Relief Offers Short-Term Breather; Long-Term Uncertainty Remains
In recent years, US trade policy developments – including broad tariffs and anti-dumping/countervailing duties – have disrupted global supply chains and increased costs across multiple industries. The wine and spirits sector, in particular, continues to experience the ripple effects of trade tensions involving key packaging sources such as China, Mexico, and Canada, along with ongoing tariffs on aluminum and steel.
On April 2, 2025, President Trump invoked emergency trade powers under the International Emergency Economic Powers Act (IEEPA), imposing a 10% “baseline” IEEPA tariff on most imported products from most countries, effective April 5. Higher tariff rates on imports from 57 countries were temporarily suspended for all but China, providing a 90-day reprieve. Meanwhile, China was subjected to 125% IEEPA reciprocal tariffs plus 20% IEEPA “fentanyl” tariffs, as well as any other applicable tariffs, such as the 25% China Section 301 tariffs initially imposed during President Trump’s first term.
On May 12, the US and China agreed to a 90-day reduction in tariffs, effective May 14. This will reportedly result in a reduction to U.S. IEEPA reciprocal tariffs on Chinese goods from 125% to 10% but not affect the 20% IEEPA fentanyl tariffs or other applicable duties. China's tariffs on US imports will reportedly fall from 125% to 10%, also effective for 90 days.
Despite this short-term tariff relief, significant US trade restrictions remain in effect, including alternative 25% duties on steel, aluminum, and automobiles, as well as alternative 25% tariffs on Canadian and Mexican products that do not meet the origin requirements under the US-Mexico-Canada Agreement, or USMCA.
While financial markets responded positively to the immediate easing of tariffs – with major indices seeing temporary gains – long-term business confidence remains fragile amid ongoing uncertainty. Federal Reserve Chair Jerome Powell has cautioned about potential stagflation should trade instability persist. Additionally, JP Morgan estimates sustained tariffs could negatively impact global GDP by up to 1%.
Tariff implications for the wine industry
Given this persistent volatility, the wine and spirits industry remains cautious, proactively recalibrating supply strategies. Businesses are encouraged to carefully evaluate their exposure to supply disruptions – especially from China, Mexico, and Canada – and implement measures such as securing long-term contracts, maintaining safety stock, and identifying alternative supply channels in collaboration with their packaging partners.
The monthly changes across key channels are still fairly stable; however fuel costs are slightly down with US diesel lower from $3.585 in March to $3.567 in April. We anticipate increases starting in May as we approach the summer months and on the heels of some refinery closures and maintenance. We also see some port availability and lower transportation costs as a result of lowered imports from China.
Bottled Tidbits – For most of history, glass was a fragile instrument we drank from or looked through – whether it be a window, a set of reading glasses, or a television. It always needed some level of durability but did not require the everyday strength of clumsy humans using it for almost five hours a day. Then came the smartphone, and everything changed.
The moment we started putting glass in our pockets – expecting it to survive keys, curbs, and concrete – scientists had to rethink everything they knew about strength, flexibility, and resilience. And so began one of the most remarkable chapters in material science.
Enter Gorilla Glass, a sleek, nearly invisible armor forged by Corning. Designed to resist drops and scratches, its toughness is due not just to science but also to a stunning manufacturing process. Using a technique called fusion draw, molten glass flows like honey and forms whisper-thin sheets as it cools mid-air – a breathtaking balance of heat, gravity, and precision.
But then the glass plunges into a molten salt bath, heated to around 400°C to make the magic happen. This isn’t spa treatment – it’s ion exchange, where tiny sodium ions inside the glass are pushed out and replaced with bigger, brawnier potassium ions. The result? A layer of internal tension that gives the glass its almost supernatural strength.
And when you think the story can’t get more sci-fi, along comes AM-III – the world’s hardest glass. Scientists created it by crushing carbon fullerenes, then applying intense heat and pressure – 1,200°C and 25 gigapascals, to be exact – for twelve hours straight. Then they let it cool. The result? A clear, durable glass that can scratch a diamond.
This isn’t just about better phone screens – these breakthroughs open doors in solar energy, aerospace, and protective tech. What started with a cracked phone screen has turned into a quiet revolution – one in which everyday glass is becoming smarter, stronger, and almost indestructible. It also is almost as efficient as silicon to conduct electricity. So the next time you tap your screen or glance through a window, remember: you’re looking at centuries of invention – and a future that’s still being shaped, one atom at a time.
April 2025 Saxco Update -"Significant Disruptions": Tariffs Impacting Supplies
The word that will dominate supply chain conversations in 2025 (and possibly the next four to eight years) will be “tariffs”. It is no longer a market-by-market theme. Instead, due to the US administration’s “Liberation Day” on April 2 – intended to remedy trade deficiencies, increase US manufacturing advantages, and tighten down on weaknesses in trade policies from the country’s top trading partners – the world is upended as it relates to global commerce.
Liberation Day saw the unveiling of 10% universal global tariffs and reciprocal tariffs for specific countries ranging from 11% to 50%. The US has not imposed tariffs to this degree in over 75 years, and the proposed increases emulated the protectionist policies of 1922 and 1930, which had a dramatic effect on the US economy.
Effective April 10, those countries which had received country-specific rates greater than 10% – such as the EU (20%), Vietnam (46%) and South Africa (30%) – were given a 90-day reprieve. Absent a specific exclusion, imports from these countries will be subject to a 10% tariff from April 10 through July 8. Unless the US administration takes further action, the 10% rate for these countries will expire, and the higher country-specific rates will apply, effective 12:01am EDT July 9.
Meanwhile, the US and China have become embroiled in a tariff war. The US rate for reciprocal tariffs on China has increased to 125%, effective April 10. This 125% rate has no expiration date, so it will continue to apply unless and until the US administration takes further action.
Significant disruption
The tariffs are causing significant supply chain disruptions, affecting everything from fuel to aluminum and packaging materials like boxes and bottles. In fact, various packaging components like corrugated cardboard will experience hikes in costs and shortages as a result. The tariff policies and resulting uncertainty are driving up costs and risk causing inflation.
Additionally, exporting wine and spirits to key markets like Canada has become increasingly difficult, forcing more products into the US market. This surplus drives prices down as companies compete for placements and strive to increase depletions. Together, the rising costs and declining prices could pose a severe threat to the industry.
We continue to see this uncertainty play out with the six key indicators we measure monthly. In March, the US diesel cost per gallon dropped to $3.585 from $3.675 in February. Similarly, the ocean freight from Asia to the US on the West and East Coast has decreased significantly since last month. As mentioned above, the costs of individual packaging components, like corrugated cardboard, are experiencing meaningful increases. Glass is becoming more and more of a concern, especially from China and Mexico, and we are watching the cost of aluminum closely due to Canadian tariffs. Whether with Saxco or other vendors, securing contracts to guarantee supply quantity and prices is smart regardless of whether your vendor or brands may pay product premiums due to tariffs or sourcing changes.
As we enter the second quarter of 2025, the future seems more opaque than ever. We empathize with the challenging times and know that a stable supply chain is a crucial part of doing sustainable business in the longer term.
Bottled Tidbits – Because bottles have been around so long and all over the world, exploring stories about wine is a forever journey through history. This month, while exploring the history of the punt, we stumbled on a downloadable copy of the 1906 Illinois Glass Company bottle catalog. It’s a fantastic lens into the past and how much change has occurred while things have still remained the same.
One of the most interesting things is the quantity of bottle choices Illinois Glass presented, considering the first industrial glass production device – the Owens Glass Machine – had only been invented three years prior to the publication of this catalog. With a production of 240 bottles per minute, the machine was not only instrumental in changing the economics of glass manufacturing, it became one of the lesser-known inventions to change society forever. By improving the speed and cost of bottle availability, it greatly enhanced the distribution of medicine, dairy, beer, wine, spirits, chemicals, and more - and, as an accidental consequence, the increase in use of glass to catalyze so many other scientific advancements.
Saxco Update: "Cascading Implications": Tariffs Impact Alc-Bev Packaging
Each month, the packaging and materials part of the market becomes increasingly challenging to predict due to the erratic implementation of tariffs and ensuing trade wars. That being said, both the threat and actual application of tariffs have cascading implications for wine and spirits sales of finished goods and all the components.
The US government enforced 25% tariffs on imports from Canada and Mexico, effective March 4, 2025. The administration rowed back somewhat on March 6, postponing until April 2 tariffs on all products imported from Canada and Mexico covered by the USMCA. However, a 10% duty on Canadian energy will likely remain in place. Additionally, the administration pressed ahead with 25% tariffs on all steel and aluminum imported into the US, effective March 12, arguing it will help level the playing field for US manufacturing. Unfortunately, this will likely have profound implications for the cost of goods of many products including – most pertinently for our industry – canned alc-bev products.
In parallel, the US administration has imposed an incremental 10% tariff on Chinese imports. The total incremental tariff for Chinese imports in 2025 is 20% (10% on February 4 and 10% on March 4). Increased tariffs will apply upward pressure on domestic pricing as domestic demand increases in a constrained capacity market. Unless there is tariff relief by the beginning of summer, wineries that have not secured guaranteed bottle contracts at stable prices may face significant cost increases and potential shortages.
This is a very fluid situation, and the terms can change at any moment. We will work with the Ciatti team to update you as additional information becomes available.
In other news, the International Longshoremen’s Association (ILA) has ratified a new six-year contract covering East and Gulf Coast ports. This deal provides labor stability until 2030.
In tandem, we are seeing fuel prices continue to increase. The US Diesel $/Gal monthly price increased in February to $3.675 versus January’s price of $3.634. With Canadian energy tariffs in effect, US fuel prices are expected to continue rising due to the large volume of Canadian gasoline, heating oil, and diesel traded by the US.
In better news, ocean freight from Asia to the West and East coasts has decreased since last month. Additionally, tariffs on Chinese goods place downward pressure on Asia's import volume and ocean freight pricing.
Hopefully, our next update will be able to report a stabilization of the market so wineries can adequately plan for the 2025 bottling.
Bottled Tidbits—There are two key components to making glass. The first is Silica (Silicon Dioxide or SiO₂), most commonly found in nature as quartz. According to 2021 statistics, China was the leading producer of Silica, with an output of approximately 6 million tons, followed by Russia at 580,000 tons, Brazil at 390,000 tons, Norway at 350,000 tons, and the US at 310,000 tons.
The other key component is Soda Ash (sodium carbonate or Na2CO3), often contained within mineral trona from lake brines or mineral deposits. Interestingly, Wyoming's Green River region holds the world's largest deposits. In 2025, China produced approximately 20 million metric tons of soda ash, the US produced around 11 million metric tons, and Turkey contributed about 4 million metric tons.
Also worth noting, Saxco’s own Stephanie Ramczyk published an article about our philosophy of “RightWeighting” bottles versus the incorrect myopic focus on “Lightweighting”. To learn more, you can read Stephanie’s piece here.
While this diagram represents a measurement of heavier bottles from Mexico, the concept of RightWeighting goes beyond just measuring bottle weight to assess a wine package’s carbon footprint. RightWeighting involves evaluating various factors – including the source of materials, production processes, and distribution footprint – to determine each product's most environmentally friendly packaging options.
Nicolas Quillé, MW, of Crimson Wine Group (not a Saxco customer), has developed the gold-standard framework, set out here. This initiative is designed to reduce carbon emissions effectively by adjusting bottle weights for their most widely distributed products, while also using lighter yet trustworthy packaging for their smaller production and premium wines. This approach balances the goal of minimizing environmental impact with maintaining consumer confidence in the quality of their packaging.
Rightweighting: A Smarter Approach to Sustainable Wine Bottles
The beauty of the wine business is that wineries have the potential to draw a direct line from growing the grapes to selling the finished bottles of wine. The ability to trace wine production through every step is a valued asset in a food and beverage marketplace where transparency has become more important to consumers.
Today’s marketplace has placed an imperative on attracting younger generations rather than simply relying on established consumers. The industry has expended significant time, energy and effort to understand what appeals to these consumers and how to reach them. Some core lessons learned: sustainability and authenticity matter to these consumers; moderation is trending; and theirs is an on-the-go, experiential lifestyle. With these new trends in younger consumers, wineries are adjusting everything from how they grow grapes to their messaging to share their sustainability journey.
One of these transitions is in how wine is bottled, and it is driven by cost savings as much as a changing customer base. During the past decade, the use of more environmentally friendly, lighter-weight bottles has increased, often accompanied by beneficial sustainability claims in marketing campaigns. This shift is a plus for these young customers, but wineries may worry that changing to a lighter bottle will affect the brand’s reputation with their loyal consumers.
Rightweighting instead of just lightweighting
"Many of our customers in Napa, Sonoma, and Mendocino are using 900-gram bottles and have built their brand around that particular presence,” explains Stephanie Ramczyk, Senior Director of Product and Business Development for Wine at Saxco, a leading value-added supplier of packaging solutions for the food and beverage industry. “Switching to a 400-gram bottle would be a significant and bold change that could alter their branding and market identity. This shift might negatively influence how people perceive their wines.”
She also points out that a 400-gram bottle might not be the best choice for the winery. “Although many wineries use super lightweight bottles, they are not always the most efficient from a manufacturing standpoint. Thinner glass used in these bottles demand more precise production techniques, which can drive up costs compared to a 500-gram bottle.”
To help customers make the best bottle choices for their brands, “We talk to customers about ‘rightweighting’ their products instead of simply lightweighting them.”
The rightweight concept is an outgrowth of Saxco’s history of focusing on building rapport with its customers to help them succeed. Ramczyk holds sustainability consultations with Saxco customers who request them.
“It helps us understand who they are,” she says. “We go through their entire packaging lineup to assess current use. The sustainability consultation is also an efficiency consultation. We ask wineries, ‘What’s important to you? What does your brand need to stand out on the shelf and achieve your goals?’ From there, we explore opportunities to reduce costs across the board.”
Ramczyk provides an example: “We can move a brand from a 900-gram bottle to an 800-gram or 700-gram bottle to gain potential cost savings and sustainability upsides while maintaining the brand’s identity.”
Sustainability metrics
During the consultation, Ramczyk uses a sustainability calculator to assess the environmental impact. She inputs the number of bottles needed, their gram weight, and the transportation logistics to calculate the CO2 emissions.
“For a 600-gram bottle produced in Tracy, California, and delivered to Napa,” she explains, “we calculate the CO2 emissions for the trip and compare it to that for a 900-gram bottle produced in Mexico.” Having the estimated CO2 emissions of these two options side by side makes the impact on sustainability crystal-clear for a customer.
Ramczyk smiles, adding, “Our calculator presents the results in real-life terms. For instance, the CO2 emissions saved might be comparable to planting 1800 trees, recycling 4500 bags of trash, or saving 180,000 miles worth of fuel.” She also covers other packaging materials during the consultation since Saxco provides wineries, breweries and distilleries with bottles, aluminum cans, closures and more. They also offer completely custom bottles, closures and labels to help brands stand out on the shelf.
A wine’s sustainability can be a deciding factor in whether consumers, particularly younger generations, will end up putting a wine bottle in their cart—whether shopping online or in-store. Ramczyk’s goal is to apply the company’s years of experience to help customers select the best materials for their brands, including the eco-friendly options of rightweighted glass and recycled materials. Reach out to request a sustainability consultation here.
February 2025 Update - Tariffs to Cause Glass Shortage and Price Rises
Over the past month, the wine industry has been caught in a whirlwind of shifting signals from the new US administration regarding tariffs. The rapid pace of change has left many wondering whether these moves are strategic negotiation tactics or actual policy changes that will directly impact pricing for wine-related goods and materials.
The Trump administration initially imposed tariffs on imports from Mexico (25%), Canada (25%), and China (10%) – the White House Fact Sheet is here. While a temporary 30-day pause has been placed on tariffs for Canada and Mexico, concerns about retaliatory measures remain high. Canada, for example, had already announced 25% counter-tariffs on US goods, including alcoholic beverages – a move that could significantly impact California wineries and other US producers exporting to our northern neighbor.
But it's not just the challenges with finished goods that we are concerned about; it is how tariffs will affect the packaging components like boxes, bottles, capsules, and more. With our heavy dependence on glass from China and Mexico, the tariffs will cause a surge in demand for US glass, creating a shortage and upward price pressure. If producers cannot access US glass, they will be forced to buy inflated glass prices from countries with tariffs that increase the cost of goods from 10% to 35% across multiple packaging components.
There are also hints of potential tariffs on the EU. Some companies stockpile finished goods and raw materials to mitigate potential tariffs and avoid increased prices or shortages. Simone Luchetti, president of Banville Wine Merchants, has said: "A 20% tariff increase at the importer level doesn't just stop there – it compounds through the supply chain. By the time it reaches the consumer, that 20% can turn into a 35% or more increase, which is significant."
This compounds the wine industry's rising costs. Wine is already the most expensive cost-per-ounce product in the Alcoholic Beverage category, and cost-of-goods inflation will only exacerbate the margin compression for producers as they cannot pass along those costs to consumers.
American Association of Wine EconomistsMost of the key drivers remain steady, but fuel prices increased from December’s $3.494 to $3.634 a gallon. There are concerns about increased fuel prices due to winter demand and Canadian energy tariffs (both direct and retaliatory).
Ocean freight from Asia to the US West and East coasts has decreased since last month, but there is still upward pressure on pricing coming out of the Chinese New Year, compounded by the anticipated increase in ocean freight activity from US producers stockpiling Chinese goods to avoid future tariffs.
Packaging Designed to Achieve Sustainability Goals
Stop by and say hello to Saxco’s team at Booth #500 at the Unified Wine & Grape Symposium. Play our “Spin to Win” wheel for exciting giveaways and donations toward planting trees in areas devastated by wildfires in California. While you’re there, chat with our product experts about packaging options designed to help you reduce your carbon footprint and achieve your sustainability goals. Let’s raise a glass to a greener future—don’t miss the chance to connect with us and make an impact!
Saxco
Unified Symposium Booth: 500
Saxco is a full-service packaging solutions supplier. We have served the distiller, wine, and craft beverage community for more than 90 years, combining our expertise, passion, and commitment to your success with modern packaging technologies. We are uniquely positioned as your single source supplier, offering standard glass bottles and cans to fully proprietary packaging solutions, and in-house services ranging from artwork management, can sleeving, fully automated pack-outs, and more. We leverage a world-class global network of manufacturers to give you the surety of supply you can depend on. And with inventory planning and management, and flexible contract and credit terms, we make it easy to scale your business. Contact us today to receive a FREE consultation from a dedicated packaging expert.
Prospect of Tariffs Increasing Domestic Glass Demand
The Saxco family hopes you had a fantastic holiday filled with laughter, excellent food, and wine that continues through the end of the year. May Santa Claus bring you everything on your list and more.
The whole industry is tentatively hopeful for solid holiday sales, yet there is a shadow of concern due to the potential imposition of tariffs in 2025. This looming threat could affect imported wines and essential materials such as bottles and boxes and possibly prompt retaliatory tariffs. For wine packaging, the threat of 25% tariffs on Mexico and Canada, as well as the potential 10% China tariff increase, could result in substantial increases in goods costs and demand for US glass manufacturing. We are already seeing an increase in the tightening of demand for domestic glass, increasing its lead time. We recommend you speak with your partners and know where they source your packaging goods in anticipation for any future changes in duties.
While most things are stable, gas prices have decreased ever so slightly from October's $3.585/gallon to November's $3.522, and ocean freight from Asia to the West Coast has also dropped; there has been a slight increase from Asia to the East Coast in ocean freight costs. Ardagh has filed an appeal on the unanimous CVD decision.
Bottled Tidbits - In the Historical Museum of the Palatinate in Germany sits the oldest wine bottle ever discovered - the famous Speyer Wine bottle. A team of archaeologists unearthed this sealed bottle buried in a 4th-century AD Roman tomb in 1867 near the ancient city of Speyer. This sealed glass bottle contains what was once considered the world's oldest known liquid wine, dating back to around AD 325. Sadly, in 2021, the title was usurped by a 1st-century AD bottle of wine found in Carmona, Spain, which became the new "oldest surviving wine in the world”.
The Speyer bottle, affectionately referred to as Römerwein, or "Roman wine," is a stunning piece of ancient craftsmanship. This 1.5-liter vessel, characterized by its yellow-green glass and whimsical dolphin-shaped handles, showcases ancient Rome's advanced glassmaking and wine preservation techniques. The bottle's contents, intended as a provision for the afterlife, offer a tantalizing glimpse into historical practices surrounding death and the afterlife. Some of us at Saxco have requested a bottle of wine to travel with into the afterlife.
The Speyer wine bottle serves as a delightful detour into history, showing how we can see into the past using the universal language of wine. Amazingly, an age-old vessel can be a tool to remind us of civilized cultures' relationship with our magic beverage over the millennia and how it continues to captivate and inspire humanity across time and space.
November’s Update on Market Dynamics in Beverage Packaging
With a challenging harvest, ongoing industry headwinds, and the recent resolution of the US election, the world is still adjusting to what has become a continuously evolving “new normal” since COVID-19. The supply chain now braces for potential uncertainties surrounding a new administration.
Concerns about rising fuel expenses are becoming more pronounced, with diesel prices experiencing a modest increase of approximately three cents on average across the US, as reported by the EIA. This uptick is causing anxiety among businesses that rely heavily on transportation to maintain their supply chains. On a more positive note, there is significant relief in international shipping. The cost of ocean freight from Asia to the US has seen a remarkable decline, with container shipping fees plummeting by $1,000 to $2,000.
The International Longshoremen’s Association recently conducted a brief but impactful three-day strike at ports along the East and Gulf Coasts. This work stoppage concluded with a tentative wage agreement, extending the existing contract until January 15th. Jonathan Gold, Vice President for Supply Chain and Customs Policy at the National Retail Federation (NRF), warns that although this strike was resolved quickly, the potential for a more prolonged strike looms if a new labor contract is not secured by January. In anticipation of possible future disruptions, companies are taking pre-emptive measures. Many are expediting their shipments and redirecting cargo to West Coast ports as a strategic move to avoid expected congestion and delays that could arise from ongoing labor negotiations. These proactive steps reflect the ongoing uncertainty in the supply chain landscape.
A persistent issue is the ongoing closure of glass furnaces. O-I has shuttered its Illinois plant and R&D center, adding pressure on glass supply. However, there is some good news: Arglass has opened a new facility with a beer bottle-focused furnace in Valdosta, Georgia. With significant leadership changes among major glass manufacturers, it is yet to be seen if these new executives will bring fresh strategies or continue with the status quo.
While the election’s impact on tariffs remains unclear, it’s essential for anyone sourcing international glass to consider alternative US suppliers or secure guaranteed imports, especially given the uncertain trade landscape with key countries like China and Mexico.
Bottled Tidbits - Meet Sir Kenelm Digby, a true historical maverick. Haunted by the memory of his father, executed as a co-conspirator with Guy Fawkes, Digby carried what he called a “stain on his soul.” But his life was anything but ordinary. As a licensed privateer (a pirate with a royal seal of approval), he escaped a forced marriage to a French princess and poured his energy into an eclectic array of pursuits. A natural-born polymath, Digby wrote a book of bizarre remedies, including a plague “cure” mixing sherry with sheep stomach contents and a headache remedy – “Viper Wine” with real venom – which tragically proved fatal for his wife.
Digby’s curiosity only grew, leading him to co-found the Royal Society. Teaming up with Admiral Sir John Mansell, a scheming MP and coal magnate, the two orchestrated a crafty plan. Mansell passed a law that banned wood-fired furnaces to “save trees for the Royal Navy,” conveniently driving the glass industry to rely on his coal. Digby developed a new glass formula to meet the coal's higher heat, resulting in far sturdier bottles.
Meanwhile, fellow Royal Society member Christopher Merret was experimenting with wines, discovering that adding sugar and molasses made wine sparkle. With Digby’s durable bottles, Merret’s sparkling wine idea became feasible, setting the stage for the world’s first sparkling wine. Together, Digby and Merret’s innovations reshaped wine forever, creating a legacy that still sparkles today.
Check out Ciatti's November California report here: https://ciatticompany.substack.com/p/ciatti-california-report-november.
Saxco October Update: Port Strikes and Manufacturing Constraints
The wine industry continues to reflect the geo-political uncertainty of the world. While Cabernet has been testing the mettle of growers and winemakers, with a heat spike to make things even more challenging, the themes of logistical efficiency, manufacturing constraint and growing demand also continue to the forefront.
Freight costs from Asia to the US have shown some relief, with a 4% decrease for the West Coast and a 3% dip for the East Coast, which could slightly reduce import expenses. Canadian rail operations remain stable for now, but potential disruptions loom as labor negotiations continue. Similarly, there is potential for a West Coast port strike. The US barely avoided a prolonged East Coast port strike commencing October 1st, 2024; the strike was suspended on October 3rd. If it had proceeded for longer, it would have created significant bottlenecks in supply chains, affecting shipments between Maine and Texas.
Trade and Duty Updates
In a major development, the US International Trade Commission (ITC) issued a negative final injury determination on September 20th, 2024, in the countervailing duty (CVD) investigation concerning glass wine bottles from China. This ruling means that no CVD duties will be imposed, and any preliminary cash deposits for these duties will eventually be refunded, though the process may take several months.
The parallel anti-dumping (AD) investigations for glass bottles from China, Mexico, and Chile are still underway, with final determinations expected by the end of the year. While we can’t predict the outcome, the ITC’s recent negative ruling in the CVD case may indicate a similar outcome for the AD investigations.
Looking Ahead
Port Strike: Although the East and Gulf Coast port strikes ended fairly quickly, it will take time to work through the backlog of cargo. It will likely take several weeks before cargo can begin to flow at a normal rate.
Manufacturing Constraints: Reduced furnace capacity among glass manufacturers could lead to higher prices or shortages.
AD Investigation Timeline: Key dates include December 16th, 2024, for the Commerce final determination and January 30th, 2025, for the ITC’s final ruling.
Bottled Tidbits - Glass is amazing! It’s infinitely recyclable, and just one recycled bottle saves enough energy to power your computer for 30 minutes. Even better, that bottle could be back on store shelves in as little as 30 days. In places with top-notch recycling systems, about 80% of collected glass is turned into new bottles and jars, cutting down the need for raw materials like sand, soda ash, and limestone. So, every time you recycle, you’re helping save energy and resources!
Saxco September Update: Logistical Efficiencies, Manufacturing Constraints, and Increasing Demand
Welcome to September’s update from Saxco on market dynamics in beverage packaging. This update first appeared in August’s Ciatti California Report, which you can find on Substack here.
It is harvest season in wine country, beginning with white wines like Sauvignon Blanc. This period is not only one of the most picturesque but also the most hectic in our industry. The urgency of harvest time, which waits for no one, triggers a rush of last-minute requests for wine bottles and packaging, driven by new strategies, increased yields, or fresh plans. All of this activity in the vineyards reverberates throughout the supply chain, reflecting the season’s dynamic pace.
Logistical efficiencies, manufacturing constraints, and increasing demand due to harvest were the theme for August. Ocean freight costs from Asia to the US have recently decreased, with a 4% drop for the West Coast and a 3% reduction for the East Coast, potentially lowering import costs. Meanwhile, Canadian Rail operations are stable, although ongoing Union negotiations could impact future service reliability. However, there is escalating concern over potential disruptions from a projected East Coast Port strike slated for October 1st, 2024, which could hinder port operations and affect supply chains.
On the manufacturing side, major glass manufacturers continue to reduce furnace capacity, which still has the potential to create downward pressure on supply, and could possibly lead to shortages or increased prices in the wine glass market.
About
Saxco is a full-service packaging solutions supplier. We have served the distiller, wine, and craft beverage community for more than 90 years, combining our expertise, passion, and commitment to your success with modern packaging technologies. We are uniquely positioned as your single source supplier, offering standard glass bottles and cans to fully proprietary packaging solutions, and in-house services ranging from artwork management, can sleeving, fully automated pack-outs, and more.
We leverage a world-class global network of manufacturers to give you the surety of supply you can depend on. And with inventory planning and management, and flexible contract and credit terms, we make it easy to scale your business. Contact us today to receive a FREE consultation from a dedicated packaging expert.
Contact
Contact List
| Title | Name | Phone | Extension | |
|---|---|---|---|---|
| Stephanie Ramczyk | sramczyk@saxco.com |
Location List
| Locations | Address | State | Country | Zip Code |
|---|---|---|---|---|
| Saxco | 2975 Cordelia Rd, Fairfield | CA | United States of America | 94534 |
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