Global paper shortage cannot stop Fudy from growing.

The outbreak of Covid-19 at the beginning of 2020 has had an enormous impact on people’s livelihoods, politics, and finances. The pandemic has caused many people to work from home. However, the packaging industry relies heavily on manual human labor from upstream to downstream, and it is challenging to complete operations remotely. As a result, production capacity has dramatically reduced. The severe global shortage of paper has greatly impacted the packaging of products. paper shortage

Shortage of paper pulp and falling recycling rate of paper.

Most of the raw materials used in making pulp come from natural trees which need to be felled manually. However, due to the pandemic, all wood-producing countries have been short of labor, and as the result of this, the output of wood has been dramatically reduced.

A labor shortage in the logging industry causes a lack of paper pulp. Industrial paper, which uses waste paper as its primary raw material, is also facing a material shortage crisis due to the difficulty of recycling waste paper in the pandemic era.

Whether it is virgin paper or recycled paper, the shortage of materials comes from a lack of labor. If there is no worker, there will be no pulp and no paper. If the labor shortage cannot be solved, the challenge of paper scarcity will be difficult to alleviate.

Global shortage of paper has led to the rapid surge in paper prices.

At the beginning of 2020, before the pandemic broke out, the international waste paper price was US$100 per ton. After the pandemic, the price has been soaring, and it has now reached US$230 per ton.

The cost of pulp has also continued to rise. At the beginning of 2020, the price of North American needle bleached kraft pulp was about US$1,130 per ton. In March 2021 however, the price per ton had reached US$1,420. Bleached hardwood kraft pulp has also risen from US$900 to US$1140 per ton.

Insufficient supply leads to rising paper prices. Under the principle of supply and demand, paper prices are expected to remain high until market demand is met.

The lack of containers further worsens the shortage of paper.

Moreover, the pandemic has caused a surge in global demand while there is a severe shortage of containers with soaring freight rates. Now that each container is so much more valuable, paper is sometimes inevitably excluded. Under these bad conditions (lack of labor, raw materials, and containers) the delivery time of packaged products is greatly challenged.

Fudy’s shipments grow despite the global paper shortage trend

While the overall environment has been hit hard by multiple unfavorable conditions, Fudy’s 2020 shipments have grown by more than 20% compared to 2019. Fudy has been able to supply packaging stably at various locations around the world. How did Fudy achieve this?

Grasp market trends, detect the paper shortage crisis in advance, and respond rapidly.

In the early stages of the Covid-19 outbreak, Taiwan (the base of Fudy Group) was celebrating the Lunar New Year. Fudy’s chairman, Lian-Feng Huang, realized that the pandemic was very likely to get out of control. Thus, he closely monitored the pandemic situation and stayed in close contact with the management team during the New Year holiday. After the vacation, he explicitly instructed all the department heads globally to become well-equipped and well-prepared to handle the COVID-19 outbreak. Fudy pre-ordered paper and raw materials to get ahead of the curve. They also maintained a good supply chain and continuous production lines to safely tide over the first wave of the material shortage crisis.

Multiple channels to disperse the risk of the paper shortage effectively.

Even though Fudy predicted the industrial trends, the scope and duration of the damage and impact caused by Covid-19 have far exceeded everyone’s expectations. In order to be able to provide a stable and continuous supply while living up to the trust customers place in them, Fudy drew up and executed a plan to prepare the materials.

Depending on different local situations, each country has different inventory status of paper materials. Fudy has established bases in Taiwan, Mexico, the United States, Vietnam, Thailand, and China. Therefore, Fudy has multiple channels to get the paper materials prepared, and each factory in each countries is able to support others to disperse the risk of the paper shortage effectively.

Observant, flexible, Fudy doesn’t let the lack of paper affect the delivery times.

In 2021, the situation in the packaging industry is changing rapidly due to the pandemic, and plans often fail to keep up with those changes. So in countries where the situation was well controlled last month, the situation may become uncontrollable next month and as a result factories or cities may face a strict coronavirus lockdown, and people may need to stay at home.

Although Fudy is fully prepared, facing an unpredictable pandemic, they still inevitably encounter emergencies. For instance, at the end of June and the beginning of July, Taiwan was still under the Level 3 alert, but a client unexpectedly transferred their orders to Taiwan. The sudden change resulted in a lack of materials combined with an urgent delivery deadline.

Once she received the news, Business Vice President Huiming Wu immediately tried to mobilize resources to get the materials required. After a day’s hard work, it was still not possible to fix the shortage of one important type of paper. As a result, Wu made a prompt decision and proposed an alternative plan that exceeded the specifications of the approval sheet. With the client’s approval, the delivery perfectly met the deadline.

Professional experiences are the answers to the problem of paper shortage.

Why can Fudy come up with an alternative plan in a short period of time? It relies on the following three factors:

1. Knowing the market inventory very well
2. Familiarity with paper characteristics
3. Deep understanding of the packaging structure

In other words, you must have many years of professional experience under your belt to get ahead of the game and figure out an excellent alternative that wins client’s hearts while taking the costs into account.

Mutual trust helps us to manage the paper shortage crisis.

In order to deliver on time, it is vital to earn the clients’ trusts. By earning their clients’ complete trusts, Fudy is able to go above and beyond for them. This mutual trust can help people to work through the traumatic situation of the pandemic and usher in a better tomorrow.

Lack of paper? Do not worry! Fudy is here to help you solve any packaging problem. Power for the possible!