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First, and most importantly, is that we are offering our prayers and support for the people of Ukraine and a swift end to the crisis. It's difficult to find the words to say in such a situation, but our hearts are with them and hope they may see peaceful times return soon. 

In less important terms, we have been asked about the exposure of Global-Pak and supply chain risk from the Ukrainian Crisis by a few customers and hope to give an adequate answer to all those who may be wondering how it may affect them. In an ever-changing world, this could require amending by the end of today, but here are our initial responses and feedback we have in answering the questions: 

Will FIBC bags still be made? 

We see no issues that could hinder manufacturing or the production and supply of resin from our sources. None of our manufacturers source raw materials from Russia, and most resins used by our suppliers are produced in India and the Middle East.

How will it affect shipping?

Shipping lanes that stop in Europe could potentially see some delays, as most shipping companies are not going to Russia. There could be some congestion as materials are off loaded in European Ports and routes are adjusted. If we experience any delays, we will communicate this immediately. Most of our delivery dates have some padding to account for potential delays, so unless we have significant or additional unusual circumstances this should not affect our shipments.

How will this affect the prices? 

Pricing will be the most significant risk if oil prices continue to rise and pushes the cost of resin up. It is assumed the rise would be temporary, with a return to normalcy within a few weeks. We have been told the European demand for bulk bags has dropped as they are being cautious with orders. If this holds, it will improve lead times for US Markets and reduce the pressure on resin demand that ultimately could stabilize resin. Ocean freight costs continue to be high, and some of the anticipated price relief a few were predicting will most likely be offset with fuel surcharges and other increases due to rerouting. Again, if there are any significant changes, we will keep you posted, but several freight forwarders we spoke with believe the ocean carriers will, at minimum, try to hold current freight rates until the crisis settles out.

IN SUMMARY

We believe our supply strategy is diverse enough both logistically and origin based that we will not see any issues unless there is major escalation. In summary, we have no direct risk of supply chain problems, we see potential shipping delays that we do not expect to be significant or widespread, and we see pricing as the biggest risk in the short term.