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Pain at the diesel pump creeps into paper and packaging pricing

Plan for “prolonged pain” from diesel prices for at least a year, says an S&P Global Energy analyst.

Geopolitical shocks can take time to work their way through supply chains. That’s currently visible in the paper and packaging industries as companies add fuel surcharges to orders because of skyrocketing diesel costs, largely attributed to fallout from ongoing global conflicts.

Paper and packaging companies have turned to adding fuel and freight surcharges to customers’ bills. Sylvamo issued a news release in late September announcing a $1 per hundredweight fuel surcharge to take effect on shipments as of Oct. 1. The news release said Sylvamo expects “other mills to follow given the run up of diesel costs.”

And they have. Billerud and Sustana have imposed fuel surcharges, and those companies chose to go by tonnage instead of hundredweight. The announced increases are $25 per ton of paper and paperboard as of Nov. 1 for Billerud and $20 per ton on all grades starting Oct. 12 for Sustana.

Pain at the diesel pump creeps into paper and packaging pricing | Packaging Dive

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