The increase in oil prices will raise the costs of the ice bag industry in five major areas: raw materials, auxiliary materials, energy, logistics, and production. Among these, petrochemical raw materials and logistics are the most directly and significantly affected.
Ⅰ. Core raw material cost
(accounting for 65% - 75% of the total cost, the most sensitive factor)
PE/PP plastic film (outer bag base material)
Polyethylene (PE) and polypropylene (PP) are direct derivatives of petroleum. As oil prices rise, the prices of PE/PP pellets increase, which in turn raises the cost of the outer bag (accounting for approximately 25% of the total cost).
High-molecular-weight water-absorbing resin (SAP, inner core gel)
The raw materials are acrylic acid and acrylate, both derived from petrochemicals. As oil prices rise, SAP prices increase (accounting for approximately 30%-40% of the total cost).
Non-woven fabric/Denim fabric (bag cover/outer layer)
The raw materials for polyester and polypropylene non-woven fabrics are PTA and polypropylene, both of which are downstream products of petroleum; as oil prices rise, the prices of chemical fibers yarns/fabrics increase (accounting for 10%-15% of the total cost).
II. Auxiliary Materials and Packaging Costs
Hot melt adhesive/composite adhesive
The raw materials, butadiene and vinyl monomers, come from petroleum. As oil prices rise, the cost of the adhesive also increases.
Inks/solvents
Printing inks and composite solvents are mostly petroleum derivatives. They have also experienced price increases simultaneously.
Plastic trays/paper boxes/tape
All are petrochemical products, and their costs have risen.
III. Energy and Production Manufacturing Costs
Electricity/Steam
Power generation and boiler fuel are heavily dependent on oil/gas. As oil prices rise, the energy costs of factories increase.
Equipment Energy Consumption
The power/air consumption of equipment such as film blowing, printing, compounding, and bag-making has increased.
Production Losses
After raw material prices rise, enterprises are more strictly controlling losses, but the overall unit cost still rises.
IV. Logistics transportation costs
(accounting for 10% - 15%)
Raw material procurement freight
Freight for transporting crude oil/petrochemical products, and freight for transporting raw materials to the factory have increased (due to the rise in prices of diesel/gasoline).
Finished product shipping freight
Fuel costs for national/cross-border logistics have risen, especially for small and medium-sized factories.
Cold chain logistics
Ice packs are often included in the cold chain, bearing the dual burden of refrigeration and transportation.
V. Indirect Conduction Costs
- Premium for imported raw materials: High-end SAP and special PE rely on imports. The combined effects of shipping, exchange rate, and oil prices have driven up the prices.
- Supply chain premium: Upstream petrochemical plants limit production or raise prices, causing the purchase prices of downstream enterprises to be passively increased.
- Financing costs: The pressure of stockpiling raw materials and financing orders has intensified, leading to an increase in financial expenses.
Impact ranking (from largest to smallest)
1. PE/PP outer bag > SAP core material > Fiber cloth cover (raw material end, the most core part)
2. Logistics transportation (full chain transmission)
3. Hot melt adhesive/ink/packaging (auxiliary materials)
4. Energy/manufacturing (production end)
