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March 21, 2022 08:30 AM

Kickstart: A reshoring uptick for smaller plastics firms?

Steve Toloken
Assistant Managing Editor
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    Greg Layson, Automotive News
    A reshoring uptick for smaller plastics firms?

    Could international uncertainty — including the war in Ukraine, new COVID-19 lockdowns in China and the Canadian border truck blockade — have a silver lining for smaller U.S. plastics firms?

    The answer may be yes, at least based on what a few of them have suggested in recent days.

    These are admittedly unscientific sample sizes but some executives have talked about how they see opportunities for their small firms as large global companies look to shrink their supply chains.

    Longtime plastics executive and trade association leader Ben Harp said he and a partner who just purchased a small shop outside Buffalo, N.Y., PM Plastics Inc., believe world events like Ukraine and challenges in Asia are reinforcing to companies that they should look for component suppliers closer to home.

    "It has OEMs concerned about how to protect their supply chains and we see that giving us additional opportunities," he said.

    PM's not alone. Westec Plastics in California told us it's seeing requests for more medical manufacturing in the U.S. and is making some investments.

    Looking at it from the other side, of businesses worried about losing access to U.S. customers, there's Canadian mold making shop Cavalier Tool & Manufacturing Inc. and the Canadian Association of Moldmakers.

    They told us in a story last month they worried that the border blockade by some Canadian truckers, on top of COVID challenges, could be another mark against Canadian suppliers from U.S. customers looking to reduce their risk.

     

     

    Royal Interpack N.A. Inc.
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    From opportunities to risks in supply chains

    Keeping with our supply chain theme, here's the flip side of the opportunities that some are looking for: the risks in getting what you need from your supply chain.

    The New York Times had this story last week on the difficulties faced by a small plastics packaging maker in California, Royal Interpack N.A. Inc.

    It reads like they shadowed the operations manager, Mosharraf Khalid, as he navigated series of shocks in recent months, from plastic pellets stuck on container ships for weeks off the Port of Long Beach to the U.S. government's decision to ban imports of Russian oil.

    It adds up to a very plastics-centric look at inflationary pressures through the supply chain.

    At one point, it says, Khalid was bartering with another plastic packaging maker, sending his extra cardboard tubes in return for supplies of silicone needed to keep Royal Interpack's plastic sheeting from sticking together.

     

     

     

    Rebecca Kanthor
    And, two years into COVID-19, Chinaplas postpones again

    I think I have a pretty good track record for attending the Chinaplas trade fair. Between 2005 and 2019, I was at all but one of the annual shows.

    So when the pandemic started two years ago, I can't say I had the foresight or imagination to think that two years on, it would still be tough to get back to what is the world's largest annual plastics show (and next to Germany's K Fair, probably the second most important one on the industry's global show calendar).

    Chinaplas organizers announced March 18 that this year's show, originally scheduled for late April in Shanghai, is being postponed with new dates to be announced later.

    On one hand, it's a surprise when you consider that events and shows elsewhere in the world are going ahead, like Mexico's Plastimagen earlier this month.

    But when you look at the "zero COVID" strategy adopted by China and how different that is from much of North America and Europe is thinking about the disease, it's not a complete surprise.

    With the exception of Hong Kong, China's case numbers and deaths being reported right now are tiny compared to the 1,000-plus deaths a day we're still seeing in the U.S.

    But different countries have different ideas of what they can accept, as well as varying levels of vaccination and varying capacities in their health care systems to handle surges. Add the more transmissible omicron variant and it's stressing some countries more than others.

    Chinaplas organizers, citing the public health restrictions like near lockdowns in some major Chinese cities, have decided it's not practical to hold the show as scheduled now.

    Here's hoping it can be rescheduled soon.

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