In the coming weeks, the price of cardboard in Ecuador would adjust upwards, due to the increase in the cost of raw materials, paper and inputs at the international level. Faced with such a scenario, the national cardboard sector begins to calculate how much more or less this increase would represent, which caused a reaction from the main consumers of these products in the country, the agro-export and aquaculture sectors.

Paper, the raw material in the structure of a cardboard box, can represent between 75% and 80% in some cases, depending on the type of box, according to Andrés Roldán, representative of Cartorama. Although they are still conducting an analysis to measure the impact, Roldán believes that it will be significant and estimates that “it will not be less than 18%, 20% or 22%, speaking from the perspective of Cartorama. We will see how we can further refine the number to understand the context of the country and the export sector,” he said. He announced that the company will begin announcing the adjustment directly to its customers starting in February.

The USA and Europe are among the largest suppliers of paper to Ecuador, especially to that North American country, and the price of paper has already risen in these markets, says Rafael Simon, president of Cartopel. “In Europe, the price of paper has already increased, but in the US, which is closest to Ecuador, an increase in the price of cardboard boxes between 11 and 14 percent was announced, resulting from the price increase “This was supposed to take effect this month and (according to) specialized magazines is that the increase is taking shape and will last between the rest of January and the beginning of February,” he indicated.

In this regard, Simon said that paper producers are forced to raise prices due to the inflationary issue, and consequently it has an impact on the increase in the price of paper. “Ecuador is a native importer of paper to make cardboard boxes for the export of bananas, shrimp, etc.,” he said.

Shortages and unprecedented cost escalation, to more than 40%, are affecting the national cardboard sector

Roldán, for his part, added that the dependence on imports will continue because virgin fiber paper is produced abroad. He and Simon agree that it is not only the increase in the price of paper, but also other items, inputs that make up the cost of production that have also seen growth.

One of them is the bunker, which according to Roldán will grow by 80% from 2022 to 2023. “We don’t talk about it much, but it has a huge impact on us who produce paper and of course also important for us who produce cardboard,” he explained.

In addition, there is an increase in shipping costs as a result of some of the problems that exist abroad, which include not only the conflict issue such as the one between Russia and Ukraine, but also the climate effect that occurs in the Panama Canal. .it affects the transmission. Added to this is the internal situation, insecurity on domestic roads, as well as premium corrections for internal traffic insurance. “All this sets up a scenario that is harmful, but it definitely exists and it is the reality that the cardboard sector is facing,” said Roldán.

Simon confirmed that delays in the Panama Canal also complicate their inventory and therefore they have to make additional purchases in order to “have safety inventory given that there is uncertainty in the arrival time of raw materials, so it’s a set of situations that happen, which unfortunately ends up with us having the obligation to correct the price of the boxes”, he added.

Exports predict performance

In this context, José Antonio Camposano, president of the board of directors of the Corporación de Gremios Exportadores del Ecuador (Cordex), indicated that they have experienced an increase in the prices of cardboard boxes on different occasions, especially during the pandemic because the demand for boxes, and currently it can happen, but it affects sectors differently, us more than others. “The banana sector is more sensitive to the increase in packaging costs, we (aquaculture sector) are still less sensitive because we also use cardboard packaging,” he said, noting that he would ask what the size would be. increase.

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Meanwhile, José Antonio Hidalgo, executive director of the Association of Banana Exporters of Ecuador (AEBE), noted that this increase affects his union and consumption patterns. “Although our raw materials are growing, we will obviously have future effects in a global recession economy,” he said.

According to representatives of Cartorama, the cardboard sector is strategic and crucial for the country at least until there is a replacement for cardboard. “It’s about anticipating something that is already on the horizon, because that’s what the costs say and in a way based on the fact that our exporters trust that we work for them, so much so that when the price jumps. We automatically transferred the price so that things could be seen, but at this moment and for the sake of preserving the economic and financial health of the sector, in my opinion, the adjustment is inevitable, it will start to be published in the coming days, “he assured.