U.S.-made masks and gloves became a national priority during the Covid-19 pandemic. Now the manufacturers need a lifeline of their own. Domestic production of protective medical equipment that was in short supply during the pandemic is now collapsing as hospitals and other healthcare buyers return to foreign-based suppliers. About 70% of the 100 or so U.S. mask companies launched during the pandemic have closed, according to industry estimates. U.S. production of N95 and surgical masks fell by more than 90% in 2023 from 2021 levels after elimination of masking requirements knocked out consumer demand.

The net sales growth is primarily attributed to increased selling prices of $533 million due to the pass through of inflation, organic volume growth of 5%, and a $147 million favorable impact from foreign currency changes. These increases were partially offset by prior quarter divestiture sales of $62 million. The organic volume growth was primarily due to organic growth investments and continued recovery of certain markets that had previously been facing COVID-19 headwinds. The operating income decrease is primarily attributed to a $42 million unfavorable impact from price cost spread, and a $12 million increase in selling, general, and administrative expense, partially offset by a $24 million increase from the organic volume growth, and a $23 million favorable impact from foreign currency.

Sonoco announced it is increasing prices for all rigid paper containers and closures sold in North America by 5 percent, effective with shipments on, and after, January 15, 2021. According to Ernest Haynes, Division Vice President and General Manager, Rigid Paper and Closures, North America, this price increase is necessary to recover rapidly rising costs for raw materials used to produce rigid paper containers. “Due to the rising cost of both steel and recovered paper, we are experiencing input cost pressures that simply cannot be absorbed,” Haynes said. “Our operational cost increases have been compounded by the on-going COVID-19 pandemic as it impacts labor, the build-up of inventory and associated carrying costs, which is all connected to ensuring the continuity of supply for our customers. As an essential supplier during these challenging times, our primary focus entails doing everything we can to protect our customers from business related disruptions. We take the challenge seriously in that regard and have embraced extraordinary measures to maintain continuity of supply to meet our customers’ most critical needs.”