We are committed to keeping you informed about the latest industry changes that could affect your business operations. As we all continue to navigate the ongoing uncertainties surrounding US tariff investigations, it is important to understand the implications of the immediate and continued supply and demand imbalances and how the manufacturing industry must consider aligning capacity to the broader market. 

The Department of Commerce is set to announce its Anti-Dumping Preliminary Determination concerning imported glass wine bottles and similar containers (740ml-760ml) from China, Mexico, and Chile on July 29th. Following the Department’s May 29th Preliminary Determinations for Countervailing Duties against China, which necessitate cash deposits ranging from 21.14% to 202.70%, the outcome of these investigations could significantly influence market dynamics with immediate impacts to costs and longer-term implications on a rebalancing of manufacturing capacity and lead times.

In response to the supply and demand imbalances, Ardagh Group has publicly disclosed its decision to close its glass facility in Houston and idle furnaces in Seattle. These strategic moves reflect evolving market conditions and required operational adjustments within the sector.  It is unclear at this time if there will be further changes to domestic glass manufacturing capacity. Story here: Global bottle maker lays off hundreds in Seattle | The Seattle Times.

Peak beverage season is upon us for aluminum cans and is driving longer than usual lead times for sleeving and digital print options which are typically for smaller quantities and short lead time orders.

The packaging market continues to face inflationary pressure. Corrugated packaging price increases have been announced as increases in containerboard and kraft paper have impacted the market. Diesel fuel prices have risen by 1% since May, adding to operational costs across the supply chain. Equally concerning is the rapid increase in ocean freight rates from Asia, skyrocketing from $2,000 per container in January to nearly $7,000 in June. Red Sea piracy has compounded shipping challenges between Asia and Europe, driving up insurance rates and contributing to shipping congestion. As a result, there are reports of port delays in the Asian market due to congestion and logistical bottlenecks.

As these situations unfold, we remain vigilant in monitoring developments and their potential implications for your business. Stay tuned for further updates as we navigate through these dynamic times together.

In summary, this month will be critical for illuminating the bottling challenges and availability for the 2024 bottling season. If you are risk-averse or have limited sourcing options, you should be proactive in your procurement process in July.

As seen in Ciatti's July Market Report. 

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