Beverage Industry Can’t Get Enough Plastic Bottles, Says Packaging CEO
(Bloomberg) -- Plastics makers simply can’t keep up with demand for beverage bottles, said Ron Delia, chief executive officer of packaging maker Amcor Plc.
While Amcor is adding production capacity, its efforts are being complicated by high demand and low supply. Sales of beverages packaged in rigid plastic bottles are expected to rise 3.5% this year, according to data from Euromonitor. That’s down from last year’s torrid pace, but still higher than pre-pandemic levels -- and enough to outstrip the industry’s ability to meet orders.
“Everybody is short, the industry is out of capacity, it is sold out,” Delia said in an interview. Amcor is a major bottle supplier for the beverage industry in North America, but it depends on plastics producers for the raw material.
Delia said the factories that make plastic components are still suffering from the lingering effects of the winter storms in the Gulf.
In an email, Darrel Collier, executive director of the National Association for PET Container Resources, said he wasn’t aware of widespread shortages, but the industry “is still catching up with increased demand, and learning the ‘new normal.’” Some “isolated or situational demand issues” could be the result of high demand and logistical constraints, he said.
Companies in North America and beyond have been hit with higher freight costs and logistical bottlenecks this year as a lack of truck drivers, port shutdowns and other pandemic-related delays slow the pace of shipping.
Amcor shares have gained about 5% since Aug. 17, when the company reported quarterly earnings. The company said it has been able to manage “steep raw material cost increases and supply constraints.”
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