Spain: Shortage of raw materials boosts expenditure in cardboard for packaging
This year, Almeria's agricultural sector is facing the campaign with the knowledge that expenditure in cardboard will increase by between 10 and 15%. This is the material used to manufacture the containers intended for national and international shipments, but in many cases, and thanks to packaging improvements, it is also used to display the products on store shelves.
An Almeria-based fruit and vegetable trader marketing a volume of around 200 million kilos will spend about 10 million Euro in cardboard. Based on this estimate, this year, companies of this size in Almeria will spend between 1 and 1.5 million Euro more in cardboard this season.
This increase in costs entails that Almeria's fruit and vegetable sector will have to spend between 16 and 25 million Euro more as a whole to be able to distribute the production in cardboard packaging. This figure is based on data from the latest campaign registered by the province, when production amounted to 3,620 million kilos, according to the Council of Agriculture.
Traders in the agricultural sector are concerned about this increase in costs, as it means facing the campaign with a handicap already at the start. It is an additional cost that reduces the profitability margins at origin, which has an impact on the weakest link of the chain: the producer.
According to the sector, the reason given for this is that there is a shortage of raw material. The manufacturers claim that the paper market is under pressure because there is a shortage and that takes a toll on the agro-food sector, which is forced to use more expensive materials. Moreover, cardboard manufacturers seemed to have reached their peak, so this may be the general trend in the years to come.
Source: Diario de Almerķa
Publication date: 11/21/2017
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