Welcome to September’s update from Saxco on market dynamics in beverage packaging. This update first appeared in August’s Ciatti California Report, which you can find on Substack here. 

It is harvest season in wine country, beginning with white wines like Sauvignon Blanc. This period is not only one of the most picturesque but also the most hectic in our industry. The urgency of harvest time, which waits for no one, triggers a rush of last-minute requests for wine bottles and packaging, driven by new strategies, increased yields, or fresh plans. All of this activity in the vineyards reverberates throughout the supply chain, reflecting the season’s dynamic pace. 

Logistical efficiencies, manufacturing constraints, and increasing demand due to harvest were the theme for August. Ocean freight costs from Asia to the US have recently decreased, with a 4% drop for the West Coast and a 3% reduction for the East Coast, potentially lowering import costs. Meanwhile, Canadian Rail operations are stable, although ongoing Union negotiations could impact future service reliability. However, there is escalating concern over potential disruptions from a projected East Coast Port strike slated for October 1st, 2024, which could hinder port operations and affect supply chains.

On the manufacturing side, major glass manufacturers continue to reduce furnace capacity, which still has the potential to create downward pressure on supply, and could possibly lead to shortages or increased prices in the wine glass market.