Plastics Industry Rates Decrease as Supply Remains Healthy

As inflation percentages start to decrease for consumers, plastics producers are seeing a steady decrease in their industries by way so supply and demand.

The Plastics Industry Association recently published,"Inflationary Trends Subside while Plastics Manufacturing PPI Reflects Supply and Demand Dynamics," which examines inflation's impact on plastics manufacturing.

Much like the rest of the world, plastics production was heavily impacted by inflation increases on the Producer Price Index (PPI). As the Bureau of Labor Statistics (BLS) reported an increase of just 0.1% in June 2023 which is a notable drop from the 11.2% rate seen in June of 2022.

Continuing the trend, the PPI for plastics material and resin manufacturing continued its decline for another month, dropping 1.3% in June. In June of 2022, this rate sat at 10.8% but has been on a steady decline since August of the same year.

As for the plastic bottle manufacturing sector, the PPI saw a minor increase of 0.6% in June, right about the same level from May. But, when compared to the 2022 number, it is the first decrease since March 2021, falling 1.1%.

Plastics manufacturers should be aware that these decreasing rates in PPI are due to an increased supply of plastic materials and an overall decrease in demand. This is all thanks to the evening out of supply chains, as those issues seen over the last few years no longer pose a significant threat.