Supply Chain Update- Middle East Conflict: 
Global Industry Impact & Raw Materials

Over recent months, as a direct result of the ongoing Middle East conflict and wider global supply chain disruption, the cost landscape for raw materials, packaging, freight and manufacturing inputs has shifted significantly. Whilst nitrile and latex rubber have been at the centre of many market discussions, the reality is that a much broader range of petrochemical and operational inputs have also escalated sharply, affecting different product categories in different ways

The Global Picture - From Crude Oil to Our Products

The conflict has severely disrupted the flow of crude oil and natural gas from the Middle East, a region that sits at the very beginning of the global petrochemical supply chain. To understand why this matters so directly to many of our products, it helps to follow the chain from source to shelf:

Crude Oil → Refining → Naphtha → Petrochemical Monomers → Nitrile Rubber / PVC / Polyethylene / Synthetic Fibres → Our Products

Crude oil prices remain significantly elevated compared with pre-conflict levels, creating ongoing instability across global petrochemical markets. The most critical downstream impact, however, continues to be on naphtha. Naphtha is the key intermediate product refined from crude oil and is the essential feedstock used throughout global petrochemical manufacturing.

A significant proportion of the naphtha supplying Asian petrochemical production is sourced from, or routed through, the Middle East. Continued disruption to this supply chain has resulted in sustained volatility across petrochemical feedstocks including nitrile, PVC, polyethylene, polyester and nylon.

The consequences across the global industry have been substantial:

• Major Asian chemical producers continue to operate under reduced capacity due to feedstock shortages and energy cost pressures
• Suppliers across the petrochemical chain are increasingly moving to short-term or spot-buying arrangements following force majeure declarations and contract disruption
• Freight, insurance and logistics costs remain elevated due to regional instability and shipping disruption
• Energy markets continue to experience volatility, impacting manufacturing costs globally
• Suppliers are shortening price-validity windows due to rapid raw material movement and uncertainty

These upstream pressures continue to flow directly into the materials used across disposable gloves, industrial gloves, polythene products and PPE.

How Our Product Categories are being Affected

Nitrile Disposable Gloves

Nitrile disposable gloves remain one of the product categories most exposed to disruption within the petrochemical supply chain. Nitrile rubber is produced from petrochemical monomers that sit directly downstream of naphtha. Continued disruption to crude oil, naphtha and petrochemical feedstocks has created ongoing volatility across nitrile rubber supply and pricing.

Key cost drivers impacting industrial gloves:

• Elevated nitrile butadiene rubber (NBR) costs
• Feedstock shortages and constrained raw material availability
• Reduced operating flexibility across the manufacturing base
• Rising energy and operational costs
• Increased freight, insurance and logistics costs
• Shortened supplier price-validity periods due to raw material volatility

The disposable glove market remains highly reactive, with suppliers frequently adjusting pricing in response to rapid upstream petrochemical changes.

Vinyl Disposable Gloves

Vinyl gloves depend on PVC, which is produced using ethylene and other petrochemical feedstocks directly affected by naphtha supply disruption.  The Middle East accounts for a significant proportion of global ethylene production capacity and ongoing disruption has tightened availability across the PVC chain. Production constraints at vinyl manufacturing facilities have added further supply pressure on top of increasing raw material and operational costs.

Key cost drivers impacting industrial gloves:

• Elevated ethylene and petrochemical feedstock pricing
• Reduced operating capacity at selected manufacturers
• Higher energy and transportation costs
• Increased packaging and logistics costs
• Ongoing supply chain instability impacting material availability and lead times

Natural Rubber Latex Gloves

Natural rubber latex is sourced from agricultural plantations in Southeast Asia and is not directly linked to the oil supply chain, which provided some initial insulation to cost increases and disruption. However, as demand shifts towards natural rubber to compensate for tightening synthetic rubber availability, pricing is reacting and availability tightening.

Industrial Gloves

Industrial gloves are impacted differently depending on construction type and coating composition. Whilst nitrile and latex-coated products continue to experience pressure from rubber-related cost inflation, a significant proportion of the cost impact across industrial gloves is being driven by increases in oil-derived yarns, synthetic fibres and manufacturing chemicals.

Key cost drivers impacting industrial gloves:

• Polyester costs have risen significantly due to petrochemical feedstock volatility
• Nylon costs continue to increase as a direct consequence of higher oil-derived raw material pricing
• DMF, used in polyurethane glove production and transportation processes, remains under substantial pricing pressure
• Energy and operational overheads remain elevated across manufacturing regions
• Packing materials continue to increase due to rising paper, board and plastic costs
• Freight rates, insurance premiums and transit times remain unstable due to ongoing regional disruption
• Chemical producers globally continue to face force majeure risks, production curtailments and feedstock shortages

Manufacturers across the industry continue to operate under reduced flexibility, with many suppliers only able to hold pricing for very short periods.

Polythene Bags

Polythene products continue to experience significant cost inflation due to ongoing volatility in virgin polyethylene markets.  Products containing higher virgin content, or sourced from regions more dependent on Middle Eastern feedstocks, are seeing the greatest levels of inflation.

Key cost drivers impacting polythene products:

• Virgin polyethylene costs remain significantly elevated due to crude oil and naphtha disruption
• Recycled polythene costs have also increased due to stronger market demand as some manufacturers move away from virgin material
• Packaging costs continue to rise across cardboard, film and consumables
• Energy and transportation costs remain elevated due to higher fuel pricing
• Masterbatch and colour additives have increased in line with wider polymer pricing inflation
• Freight disruption and extended transit times continue to add operational cost pressure

The market remains highly reactive, with suppliers frequently revising pricing in response to feedstock and energy fluctuations.

Paper Products

Whilst paper itself is not petrochemical-based, paper production remains highly energy-intensive and exposed to wider global supply chain pressures.  European energy markets continue to operate at elevated levels compared with historic norms, directly impacting paper mill operating costs and manufacturing economics.

Key cost drivers impacting paper products:

• Broad-based inflation across pulp, energy, packaging and transportation
• Continued volatility in fibre and pulp supply
• Increased chemical processing and manufacturing consumable costs
• Elevated electricity and gas pricing across European production markets
• Ongoing geopolitical instability continuing to impact freight and logistics networks

These combined pressures continue to drive higher production and transportation costs across paper grades.

Pulp

Whilst pulp products are not directly petrochemical-based, they remain highly exposed to rising energy, manufacturing and transportation costs.  The production process for moulded fibre and pulp-based products is energy intensive, particularly during drying and forming stages, meaning sustained increases in electricity and gas pricing continue to place significant pressure on manufacturing costs.

Key cost drivers impacting pulp products:

• Elevated electricity and gas costs across manufacturing regions
• Increased transportation and freight costs linked to fuel price inflation
• Rising packaging and consumable costs used throughout production
• Higher labour and operational overheads across manufacturing facilities
• Continued global supply chain disruption impacting raw materials and lead times
• Increased demand for fibre-based alternatives adding pressure to parts of the supply chain

As with other categories, suppliers are continuing to review pricing regularly in response to ongoing volatility in energy and operational markets.

PPE

Our wider PPE supply base is also experiencing sustained cost inflation across raw materials, packaging, freight and manufacturing inputs.  As a significant proportion of PPE products contain petrochemical-based components, suppliers are seeing varying levels of cost increase depending on product composition, labour intensity and manufacturing complexity.

Key cost drivers impacting PPE:

• Continued volatility across global petrochemical markets
• Ongoing disruption within international logistics and shipping networks
• Rising energy and manufacturing costs
• Shortened supplier price-validity periods due to raw material volatility
• Rapid changes in upstream feedstock pricing impacting production planning
• Increased freight, insurance and compliance-related costs

In some cases, supplier pricing is being revised within days, reflecting the speed and unpredictability of current market conditions.

In Summary

The current market environment remains exceptionally volatile and continues to be driven by a combination of geopolitical disruption, petrochemical feedstock instability, energy inflation and global logistics pressure.  Whilst the intensity of impact varies by product category, nearly all areas of manufacturing and supply are being affected either directly or indirectly through raw material, packaging, energy or transportation costs. 

Price adjustments implemented across product categories are intended to ensure continuity of supply, product quality and service reliability during this period of ongoing market instability. Market conditions continue to be monitored closely and further updates will be communicated as necessary.

Supply Chain Update- Middle East Conflict:
Global Industry Impact, Raw Materials and Pricing

The ongoing conflict in the Middle East continues to escalate and is now having a profound and widening impact on global supply chains. We want to give you as clear and honest a picture as possible of what is happening, how it affects the products we supply to you and how we are managing the situation.

The Global Picture - From Crude Oil to Our Products

The conflict has severely disrupted the flow of crude oil and natural gas from the Middle East, a region that sits at the very beginning of the global petrochemical supply chain. To understand why this matters so directly to our products, it helps to follow the chain from source to shelf.

Crude Oil  →  Refining  →  Naphtha  →  Petrochemical Monomers  →  Nitrile Rubber / PVC / Polyethylene  →  Our Products

Crude oil prices have surged by approximately 100% since the conflict began on 28 February 2026, with Brent reaching nearly $120 per barrel at its peak on 9 March and trading at around $112 per barrel as of 23 March 2026. Crude oil pricing was consistently $60- $70 per barrel in the period prior to the war.

The most critical and immediate downstream impact, however, is on naphtha. Naphtha is the key intermediate product refined from crude oil and it is the essential feedstock for the entire global petrochemical manufacturing industry, including the production of the rubbers, plastics and polymers that our products are made from. A significant proportion (approximately 60%) of the naphtha that feeds Asian petrochemical manufacturing is sourced from or routed through the Middle East. With that supply now severely disrupted, naphtha prices rose by approximately 74% in just two weeks following the conflict’s outbreak. This single price movement ripples immediately and powerfully through every downstream material in our supply chain.

The consequences across the global industry have been swift and significant. Polymer prices across key petrochemical materials rose by 41- 42% in the weeks following the conflict outbreak. Multiple major Asian producers have declared force majeure or significantly cut operating rates due to raw material shortages, 31 force majeure or supply allocation announcements for chemicals were recorded across Asia and the Middle East alone by mid-March 2026. The Middle East accounts for approximately 17- 20% of the world’s ethylene capacity and close to 25% of global polyethylene and polypropylene exports, the loss of that supply cannot be quickly or easily replaced.

How Our Products Have Been Affected

Nitrile Rubber - Nitrile Disposable & Coated Industrial Gloves

Nitrile rubber is produced from petrochemical monomers that sit directly downstream of naphtha. As feedstock availability has collapsed, nitrile rubber raw material costs have doubled since the conflict began. Supply across the global market is running approximately 30-60% below normal production capacity, as manufacturers of varying size and buying power find themselves unable to secure sufficient feedstock to maintain full output. Significant price increases have been confirmed on April deliveries, with further increases expected for at least May and June.

PVC - Vinyl Disposable Gloves

Vinyl gloves depend on PVC, which is produced from ethylene, a petrochemical feedstock directly affected by the naphtha supply disruption. As noted above, the Middle East accounts for a significant share of global ethylene capacity and the sudden withdrawal of that supply has caused a sharp tightening across the PVC chain. Production capacity at Asian vinyl facilities has also been impacted, adding supply pressure on top of rising input costs.

Polyethylene - Polythene Products

Polythene products are manufactured from polyethylene, which is equally exposed to the naphtha price shock. Approximately 15% of global polyethylene production is located in the Middle East and 84% of Middle Eastern polyethylene exports pass through the Strait of Hormuz, the closure of this route has significantly reduced global supply. In addition, the sharp rise in natural gas prices, itself a direct consequence of the conflict, is adding a further layer of cost pressure on polythene, as gas is both a feedstock and a primary energy source for polythene manufacturing. UK polymer suppliers have confirmed that polythene is facing both price escalation and tightening availability, with supply delays anticipated across the market. 

Natural Rubber - Latex Products

Natural rubber latex is sourced from agricultural plantations in Southeast Asia and is not directly linked to the oil supply chain, providing some initial insulation from the current shock. However, as demand shifts towards natural rubber to compensate for tightening synthetic rubber availability, pricing is beginning to react and availability may tighten further over time.

Polypropylene - Non-Woven Workwear

A large proportion of our non-woven workwear products, including coveralls, disposable overshoes and protective garments are manufactured from polypropylene (PP), a polymer derived from propylene, which in turn is produced from naphtha via steam cracking. PP is therefore directly exposed to the same upstream disruption affecting all our other petrochemical-derived products. 

Other Product Categories

It is important to note that the raw material shortages and cost pressures described above are not limited to gloves, polythene and polypropylene. The same upstream disruption to naphtha, petrochemical feedstocks, energy and freight will increasingly affect a wider range of product categories across our portfolio. 

We expect further product lines to come under supply and pricing pressure as the situation develops and we will communicate these impacts to you as they arise.

Payment Terms - Additional Upstream Pressure

In addition, payment terms across the supply chain have tightened, with many suppliers and logistics partners now requiring upfront payments. While this reflects increased financial pressure across the industry, we are actively managing the impact to ensure continuity of supply and minimise disruption.

Transport and Freight Cost Increases

The impact of the conflict is not limited to raw materials. Transport and freight costs are also rising significantly and this is adding further pressure to the overall cost base.

At the international level, Emergency Fuel Surcharges (EFS) have already been implemented by major carriers, driven by war-risk insurance premiums, route diversions, operational delays and the suspension of traffic through key maritime corridors. 

The rise in petroleum prices is simultaneously increasing the cost of road transport, both in the countries where our products are manufactured and across UK and European distribution networks. We are also seeing UK transport activities and temporary energy and capacity surcharges implemented with immediate effect. 

This is affecting the movement of raw materials to factories, the transport of finished goods to port and onward delivery to our customers. 

We expect freight and transport cost to remain elevated for as long as the conflict and its associated disruptions continue.

Energy Price Increases

The conflict has driven a sharp increase in both oil and natural gas prices globally. Natural gas prices in particular have risen steeply, as the Middle East is a major source of liquefied natural gas (LNG) for European and Asian markets.

Rising energy costs affect our supply chain in multiple ways. For manufacturing, energy is a significant input cost in the production of gloves, polythene, and related products, higher energy prices therefore feed directly into production costs, compounding the raw material increases described above. For polythene in particular, gas is both a feedstock and a fuel source, meaning it faces a dual impact from the current energy price environment.

Beyond our current product range, sustained increases in energy prices will increasingly affect a broader range of product categories across our portfolio. We are monitoring these developments and will advise you of any further impacts as they emerge.

Impact on Your Pricing

To understand how pricing is being affected, it is important to explain that we use a weighted average of available inventory, in-transit goods and new purchase orders to calculate our pricing. However, continued uncertainty in raw material supply have prompted some suppliers to move to spot purchasing, leading to significantly increased costs. Due to this upward pricing pressure, please note that:

• Price increases will be implemented from the 1st of April 2026. 
• Pricing beyond this point will be reviewed and adjusted as the situation develops, but increased cost pressure is expected for May and June.

We want to be transparent about the challenge of pricing notification in the current environment. We are receiving multiple updates daily from our suppliers, manufacturers, and logistics partners regarding cost changes. This volume and pace of change makes it very difficult to price accurately and provide the notice we would ordinarily wish to give. We are working hard to assess the current situation as responsibly as possible and to balance that against the need to keep you informed.

Looking Ahead

The situation in the Middle East continues to evolve and we are monitoring developments closely. At present, we do not have a clear timeline for when supply chain conditions will stabilise.

It is also important to understand that even in the event of an immediate resolution to the conflict, the disruption already caused will not simply stop. Supply chains operate with a significant lag. Feedstock that was never produced cannot be recovered overnight; manufacturing plants that cut capacity will take time to return to full output; and freight and logistics networks will remain strained until volume and confidence return to normal levels. In our assessment, the industry should anticipate at least six months of continued disruption and elevated costs from this point, regardless of how the geopolitical situation develops.

We will continue to provide you with honest, timely updates as the picture develops. Our commitment is to keep you as informed as we possibly can, as early as we can.

How We Are Supporting You

• We are not currently onboarding new customers, in order to safeguard the supply and service levels of our existing, loyal customers
• To further protect our valued customer partnerships, we have restricted stock requests on impacted product lines
• We are monitoring developments daily and maintaining close contact with our manufacturing and logistics partners across multiple geographies, leveraging relationships to ensure continuity of supply
• As a business that actively multi-sources across a number of supplier partners rather than relying on a single source, we are in a strong position to secure as much available supply as possible and to flex between partners as availability changes, this is a significant advantage in the current market
• Keeping you informed with regular updates as the situation develops, we will not leave you without information

We value your partnership deeply and everything we are doing is aimed at protecting your business alongside ours. Please do not hesitate to contact us if you have any questions about specific products, current orders, pricing, or stock availability.

Thank you for your continued understanding and trust.

 

References:

1. Al Jazeera — “Could oil hit $200 a barrel?”, 19 March 2026 — aljazeera.com — Brent peaked at nearly $120 on 9 March; has not dropped below $100 since 13 March.

2. FinancialContent / MarketMinute, 23 March 2026 — markets.financialcontent.com — Brent at $112.40 on 23 March 2026.

3. PolymerUpdate.com, 17 March 2026 — polymerupdate.com — Naphtha up 74% in two weeks; polymer prices up 41–42% since 28 February; 84% of Middle Eastern PE exports routed via Strait of Hormuz.

4. Syntex America / ICIS data, 20 March 2026 — syntexamerica.com — 31 force majeure / sales allocation announcements for chemicals in Asia and Middle East as of mid-March 2026.

5. ResourceWise, March 2026 — resourcewise.com — Middle East accounts for approximately 17–20% of global ethylene capacity; European PVC producers announcing price increases for March.

6. S&P Global / Platts, 13 March 2026 — spglobal.com — Middle East accounts for close to 25% of global PE and polypropylene exports.

7. Plastribution UK Polymer Market Update, 12 March 2026 — Polythene facing rapid price escalation and tightening availability.

8. IEA Oil Market Report, March 2026 — iea.org — Brent crude rose approximately 50% from pre-conflict levels; naphtha and polymer supply shock data.

 

Business Update

Due to ongoing geopolitical tensions in the Middle East, significant disruptions have occurred across the petrochemical supply chain. Several products in our range are derived from petrochemicals and are therefore exposed to the same upstream pressures:

• Nitrile disposable gloves and nitrile-coated industrial gloves rely on Nitrile Butadiene Rubber (NBR) latex, produced from butadiene, a key petrochemical derivative
• Vinyl gloves are manufactured from PVC (polyvinyl chloride), which is also dependent on petrochemical feedstocks
• Polythene products are derived from polyethylene, another petrochemical-based material subject to the same supply chain pressures

Several major upstream petrochemical producers have declared force majeure as a result of these developments. Compounding this, global oil prices (Brent and WTI) have risen by more than 50% since January 2026 and natural gas prices are increasing sharply across global markets. Together, these energy price increases are directly tightening the availability and costs of raw materials across multiple product categories.

While we are working closely with our manufacturing partners to secure supply and maintain continuity as best we can, we want to be transparent that these conditions will affect pricing, availability and lead times in the coming weeks and months.

We are monitoring the situation closely and will keep you updated as developments unfold. Please don't hesitate to contact your Sales representative if you have any questions or would like to discuss your specific requirements.

Thank you for your understanding and continued partnership.

Christmas Opening Times & Delivery Schedule

 With Christmas fast approaching, we want to help you with your festive forecasts. Please note these key dates to assist with your Christmas planning.

EASTER OPENING TIMES & DELIVERY SCHEDULE

 

Need your order before Easter?

Business Newsletter

Current market:

Product Cost Increases

After a turbulent 2022, where it became the norm for suppliers to submit price increases every few months, we have seen the market settle a little, with the frequency of which we are seeing price increases from suppliers decreasing.

Further good news is that in some product categories, such as disposable gloves, we are experiencing small decreases in pricing, as global freight costs decrease.

We are however, still expecting to see price increases throughout 2023 on many product categories, but these are mainly inflationary level increases, which were the norm pre-pandemic. As a business, we will continue to mitigate against this as far as possible.

 

Freight

Supply chain issues have more or less stabilised as a result of increased availability of sea freight capacity, giving us strong stock levels and fluid supply.

 

Government free PPE scheme

The Government’s free PPE scheme via ppe-portal.NHS.uk has been extended and is advertised to end in March 2024, however we have just had confirmation that disposable gloves stock will be depleted by March 2023 and free gloves will no longer be available, other PPE is still obtainable from the portal. Please see the estimated stock-out dates on this link

We can offer you the same high quality, disposable nitrile gloves, an extensive range of aprons, disposable masks, sterile and surgical gloves, pulp and numerous domestic and cleaning gloves that we already supply and are contracted to supply the NHS. You don’t have to compromise on quality. Click here to view all our available products that are NHS listed

 

Internal Matters:

Leadership Changes

Our parent company, Polyco Healthline Ltd has also experienced some change with Neil Wilson, our previous MD moving into a new role as Corporate Finance & Strategic Projects Executive Director. We now have a new CEO, Jason Prichard and Deputy CEO Jack Prichard. These changes prepare us for future growth and development; investing in new innovative products and exciting business projects, whilst nurturing our core business.

 

Deliveries into Europe

Polyco Healthline has expanded pallet deliveries into Northern Ireland and the Republic of Ireland (and all EU countries) via Polyco Healthline Europe Ltd. This is an extremely positive expansion that allows deliveries to flow more efficiently and reduces costs for our customers.

 

Thank you for your continued support.

 

The Brosch Direct Team

Market Challenges September 2022

As I write this, the rise in energy costs and cost-of-living crisis headline across all news stations, by all accounts the UK is in for a rough winter.  Our market is still thwart with many challenges however, there is some good news to report back on too.

 

Demand and Supply

The very good news: product supply has normalised with key categories experiencing supply meeting demand. This has led to reduced lead times and improved order fulfilment.

 

Cost Increases

Whilst as a business, we have done as much as possible to absorb cost increases by improving ordering and storage efficiencies, the situation continues to be unsustainable and we are likely to see further price increases.

 

Raw Materials & Packaging 

Energy has been incredibly volatile over the previous 12 months and forecasts suggest that the cost per therm will now continue to rise through the winter for Q4 2022 and Q1 2023, this will undoubtedly lead to further increases from energy dependant manufacturers such as paper and pulp providers.

Raw materials have continued to see price increases, for example over the last 6 months Sorted Office Waste (SOW) has seen increases of 27% and wood pulp 29% respectively, therefore we would expect to see further increases on paper and pulp products. Coreboard costs are also up 11% in the last 6 months which will impact businesses using board to package their products.

 

Pulp

Due to the continuing reduction in availability of Over Issue Newsprint (OIN), which is the fundamental raw material in the production of our pulp healthcare products, the decision has been made to move to 100% kraft in the production of these items. This is a more readily available material ensuring continuity of supply for these crucial products. Performance of the product will be unaffected, and the only visible difference will be a colour change of grey to brown due to the new material being used.

 

Transport & Freight 

We have seen a slight decrease in sea freight costs in recent months, this is predominantly due to vessels having excess capacity available as global demand for shipping has been in decline.

Whilst consumers are starting to see fuel decreases at the pump, diesel prices are still significantly higher than they were at the start of 2022 and domestic haulage rates have yet to reflect any reduction in costs.  As fuel charges continue to fluctuate and there is poor availability of drivers, we expect to see transportation and logistics costs remain very high.

 

New Product Development (NPD)

At Brosch Direct new product development is always high on the agenda, we are eager to bring new innovations to our catalogue.

Our latest exciting addition is our Compostable Eco Disposable Gloves- Manufactured from PLA (Poly Lactic Acid) which is a biodegradable starch-based polymer. Manufactured in accordance with Personal Protective Equipment (PPE) by the European PPE Regulation (EU) 2016/425 and product Food Approved to EC1935/2004. For more information click here.

 

Sustainability program

#phAMBITION is Polyco Healthline's new sustainability program. At Brosch Direct, we are dedicated to playing our part in this ambitious plan set in motion by our parent company, Polyco Healthline.

We have considered the United Nations Sustainable Development Goals (SDGs) against our value chain to better understand risks and opportunities and drive positive change.  For further information, please view our new sustainability web page.

 

Thank you for your continued support.

 

The Brosch Direct Team

Payments via Cheque

We have been informed by our bankers, Lloyds Bank, that they will be closing their branch in Bourne in November 2022.  

As a result of this closure and our ongoing commitment to reducing our carbon footprint it has been decided that with effect from 31 October 2022, we will no longer be accepting cheque payments.  We therefore request that all future payments be made directly into our Lloyds Bank account.

Please could all remittances be emailed to [email protected]

Should you wish to pay your account by card then please contact the Credit Control team on 01733 230 230.

It is important to remember that we will never ask you to amend our bank details without written communication and it is always advisable to contact your supplier to confirm their new bank details before making payment.  Should you wish to confirm our details please contact Credit Control department on 01733 230 230.

Please do not hesitate to contact us should you require any further information.

Market Challenges May 2022

Unfortunately, the UK market continues to see more of the same disruptions that it has faced over the last 12 months. Demand is still outstripping supply in certain product categories, it has been particularly prevalent in the paper industry. Labour and  transportation costs remain at a peak; however, we have seen a glimmer of hope in the shipping industry. 

Raw Materials 

Whilst not as sharp an increase, raw material costs are still increasing, for example domestic recycled paper prices have risen a minimum of 5% from February to March. If we see similar increases through May, undoubtedly in turn, we will see further increases from paper suppliers. 

Plastic Packaging Tax 

The new plastic packaging tax came into effect in the UK in April. This is a new tax that will apply to plastic packaging manufactured in, or imported into the UK, that does not contain at least 30% recycled plastic. 

Most of our range is already manufactured from recycled material or does not contain plastic packaging, and we endeavour to improve on this as it is one of our key sustainability objectives: to reduce the use of plastic packaging and increase the use of recyclable material. 

Manufacturers that do not currently use at least 30% recycled plastic in their packaging, may decide to pass the tax cost to customers. However, as a business we are doing our utmost to limit these increases being passed to our customers and rather work with manufacturers to ultimately reduce the use of plastic. 

For more information on the new tax please click here 

Transport & Freight 

Further good news: although freight costs rates remain high, they have decreased from the peak we saw in the height of the pandemic and currently remain stable. Delays in shipments have also improved, however isolated incidents continue to impact some arrivals. 

Paper Industry 

As mentioned above the paper industry has been particularly impacted by supply challenges and price increases. Unfortunately, price increases from paper suppliers continue to flow through at an alarming rate, often with no forewarning. Following from discussions with our suppliers, we don’t expect to see this pressure ease up anytime soon. 

Some source data is provided below: 

• Recycled Fibre – Over a 30% increase in the last 12 months.
• Pure Virgin Pulp – This has increased by over 45% since Jan 2021.
• Packaging – Core Board – 28% increase in the last 8 months.
• Packaging – LDPE – 38% increase in the last 8 months.
• Labour - The warehouse sector continues to struggle to replace European staff who work in warehouses and distribution centres. Members have reported increases in pay of between 20% and 30% to secure workers for entry level jobs.
• Transport – This is mostly being attributed to the cost of fuel which has increased by over 25% in the last 12 months.
• Energy cost – These have risen 436% since Jan 2021, 127% since August 2021. 

The factors outlined above continue to result in extended lead times and price pressures which unfortunately need to be passed onto our customers. We recognise that the market situation continues to cause complications and inconvenience for all, however as a business we are doing our utmost to limit the impact to our customers, and we will continue to do so. 

Any changes in these circumstances will be communicated to you as soon as we are able to, we will however share a further review in a few months’ time. 

Thank you for your continued support and understanding. 

Market Challenges February 2022

Following from our previous newsletter regarding supply chain challenges and inflationary price increases in the UK and globally, we invite you to read our latest update.

Unfortunately, we haven’t seen many market improvements and we are still experiencing ongoing disruption to our supply chains and cost increases from our suppliers due to the persistent challenges and backlogs that COVID-19 presents.

Energy & Raw Materials
As global industry starts to return to pre-Covid levels of production we are seeing raw material costs increase further, with demand often exceeding supply.

Oil prices have risen to a three-year high and this impacts our entire supply chain. Products that require higher energy consumption to produce are worst affected, thus paper and pulp producers for example have been severely impacted. Increased energy and raw material costs result in products costing more to produce.

Labour
Industries within the UK are competing for a far smaller pool of workers. We see workers in vital sectors such as manufacturing, warehousing and logistics move to those sectors that can provide higher wages. This has resulted in a labour shortage which is impacting production and delivery, whilst also resulting in employers having to increase wages by up to 20% to retain and recruit staff. This in turn increases production costs and lead times.

Transport & Freight
Globally, ocean freight costs remain at an all-time high. Shipping costs have increased by up to 500% in the last 18 months, this coupled with their extended lead times has caused shortages in containers and capacity into the UK. This has a direct impact on the cost of products arriving in the UK and delays in receiving deliveries.

Within the UK, we have seen an increase in demand of UK manufactured products. Unfortunately, the local demand of raw materials often outstrips supply, and the delays to get it to the UK combined with the shortage of HGV drivers in the UK results in longer lead times from UK suppliers.

The factors outlined above have resulted in extended lead times and price pressures which unfortunately need to be passed onto our customers. We recognise that the current market situation is causing complications and inconvenience for all, however as a business we are doing our utmost to limit the impact to our customers, and we will continue to do so.

Any changes in these circumstances will be communicated to you as soon as we are able to, we will however share a further review in April 2022.

Thank you for your continued support and understanding.

Market Challenges November 2021

As a business, like many others, we are experiencing disruption to our supply chains and cost increases from our suppliers due to the challenges that COVID-19 continues to present globally. We acknowledge that these are difficult times, and we want to ensure that we keep you, our valued customer up to date with the challenges that we and our suppliers are currently facing.

Energy
Rising energy costs impact our entire supply chain to varying degrees, depending on the product. Products that require higher energy consumption to produce are worst affected, thus paper producers for example have been severely impacted. Increased energy costs result in products costing more to produce.

Raw Materials
Demand and supply of raw materials globally have fluctuated considerably over the last 12 months. As global industry starts to recover following the pandemic, we are seeing raw material costs increase, with demand outstripping supply

Labour
Industries within the UK are now competing for a far smaller pool of workers. We continue to see workers in vital sectors such as manufacturing, warehousing and logistics move to those sectors that can provide higher wages. This has resulted in a labour shortage which is impacting production and delivery, whilst also resulting in employers having to increase wages by up to 20% to retain and recruit staff. This in turn increases production costs and lead times.

Transport & Freight
Globally, ocean freight costs are at an all-time high. Haulers have reduced the speed of their ships causing increased shipping times and shortages in containers and capacity into the UK. Freight costs have increased by up to 500% in the last 12 months. This has a direct impact on the cost of products arriving in the UK and is creating delays in receiving deliveries, which we envisage will continue up to Christmas.

Within the UK, all industries are being affected by the shortage of HGV drivers, which has been widely reported in the press. Actions are being taken by companies to address this, such as increasing wages and offering signing on bonuses. Despite these measures, we are still seeing longer lead times from UK suppliers.

All of this is resulting in longer delivery lead times and cost increases, which we unfortunately have to pass onto our customers. As a business we are doing our utmost to limit the impact to our customers, and we will continue to do so. Any changes in these circumstances will be communicated to you as soon as we are able to.

We would like to take this opportunity to thank you for your continued support and understanding.

Coronavirus Update

To ensure that vital supplies reach those who need them we have placed temporary purchasing restriction on the website.

Global PPE supplies are still strained, therefore we continue to use product restrictions on a few products.

We would like to thank our customers for your continued support during this difficult time, especially as we continue to experience issues with the supply of disposable gloves and PPE products.

Unfortunately, the consistent increased demand in glove (and PPE) products endures. There are many factors contributing to this, but essentially there is still not enough production output to meet the increased global demand and therefore the supply (and cost) of gloves, and other PPE products remains a global challenge.

Please see below the answers to your frequently asked questions.

Can I Order Disposable Gloves & PPE?
Due to low stock levels and ongoing supply issues, some of our Disposable Gloves and PPE products are classified as ‘Restricted Products’, meaning that we are currently only able to supply these to our current Care and Front Line Healthcare customers. We are constantly reviewing our stock levels and as soon as our stock position improves, products will be taken off restrictions and will made be available to our wider customer base. We have already removed some restrictions on several of our products.

What are restricted products and why are they restricted?
We are temporarily restricting certain products so they can be reserved for our Current Care and Front-Line Healthcare customers. These are products where our stock levels are low, and they are vital in the Healthcare and Care sectors. As these products are in short supply, we feel we have the moral duty to ensure that they reach the sectors most in need of them. We are constantly reviewing our stock levels and so rest assured that as soon as our stock position improves on the lines affected, these products will be taken off restriction and will be available to our wider customer base.

 

• Care / Nursing Homes / Domiciliary & Home Care Agencies / Hospices
  
• Hospitals & GP Surgeries
• Funeral Directors 

Why are some products being rationed?
Due to limited stocks and supply delays on certain product lines, we have had to implement a rationing system thus limiting quantities customers can purchase, this is to preserve stock and to be fair to all of our customers at a time of limited supply. If customers attempt to order over the rationed amount, an alert will pop up advising what maximum order quantity is and you will be unable to add the item to your basket until your order quantity has been decreased to below rationed amount. As our stock situation improves or worsens, affected product lines will be removed or added to the rationing system.

Are your delivery lead times longer than normal?
For the vast majority of our customers delivery times have returned to normal, “next day delivery if you order by 3pm”. On the odd occasion there may be small delays and we apologise for any inconvenience caused.

Why are prices increasing?
Eight months after the Coronavirus pandemic’s unwanted arrival it continues to generate an unprecedented demand for medical consumables and associated products worldwide. Unfortunately, this consistent increased demand, coupled with a shortage of raw materials and limited production capacity is causing manufacturers to increase their prices. Our focus is securing a consistent supply of stock for our customers, and therefore having to accept these increased prices.

We know that price increases are never welcome and cause disruption to our customers, so we only request them when completely necessary. Rest assured that as soon as prices start coming down, we will pass these decreases onto our customers. We have already reduced pricing with hand sanitisers, masks and aprons for example, where supply has improved, and costs decreased.