Corrugated boxes are the latest product in short supply, according to the UK’s largest manufacturer.
Most parcels in the UK are delivered in corrugated board and paper packages and demand has surged during lockdowns as more people have stayed home and increased their e-commerce orders.
“A lot of products go in boxes because that provides the best protection for the products and so we've really been benefiting from that, but it's been a very challenging environment in terms of production," said Miles Roberts, chief executive of DS Smith PLC (LSE:SMDS).
The news comes as the Boxing Day sale approaches, with online shopping expected to increase its share of the total spend, which re-emphasises the excess demand for cardboard and corrugated boxes.
Last year, there were 5bn parcel shipments in the UK, which is 74 boxes per person and represents a 33% rise on 2019, said the Pitney Bowes Parcel Shipping Index.
However, despite total waste from UK households rising by 1.8% to 22.6mln tonnes or 399kg per person in 2020, recycling rates have dropped 1.2% to below 10mln tonnes.
"What's happened during this pandemic is that the amount of material that we're able to collect, boxes and used newspapers, has reduced and that has caused some challenges in terms of that supply of the recycled material that we need to make our boxes,” Roberts added.
The fall in recycling rates coupled with increased demand has driven prices higher.
Although, they aren’t the only causes of the issues…
"There have been other challenges, it could be in the availability of trucks and delivery, we've seen the cost of energy rise, we're a heavy user of energy, and inevitably it has led to price increases," commented Roberts.