一、Introduction
As a core consumable in the modern packaging industry, heat shrinkable film is widely used in food, daily chemicals, electronics, logistics and other industries. It boasts excellent properties such as moisture resistance, dust prevention, sealing and fixing, making it an indispensable product in the plastic packaging industrial chain. Fluctuations in international crude oil prices have always been a key external factor affecting the development of the heat shrinkable film industry. The recent continuous rise in crude oil prices has directly impacted the production, pricing and operation pattern of the entire heat shrinkable film industry.
二、 Industrial Chain Connection Between Crude Oil and Heat Shrinkable Film
The main raw materials of heat shrinkable film are polyolefin resins such as polyethylene and polypropylene, which are all downstream derivatives of crude oil refining. Crude oil is the source raw material of the entire heat shrinkable film production chain. The rise and fall of crude oil prices will be transmitted step by step along the petrochemical industry chain, first affecting the purchase prices of upstream raw materials such as polyethylene and polypropylene, and then directly acting on the production cost of heat shrinkable film, showing a strong positive correlation between the two.
三、Specific Impacts of Rising Crude Oil Prices on the Heat Shrinkable Film Industry
1. Sharp Rise in Production Costs and Squeezed Corporate Profit Margins
Raw material costs account for more than 70% of the production cost of heat shrinkable film, making it the core factor determining product costs. The rise in international crude oil prices will directly push up the market quotations of polyethylene and polypropylene. Upstream raw material manufacturers have raised ex-factory prices one after another, leading to a substantial increase in raw material procurement costs for heat shrinkable film producers. Against the backdrop of intensified industry competition and strong downstream bargaining power, it is difficult for enterprises to transfer all cost pressures to downstream customers in a timely manner, resulting in a decline in gross profit margins. The profit pressure on small and medium-sized producers is particularly prominent.
2. Passive Increase in Product Prices and Pressure on End Market Demand
With the continuous rise in raw material costs, heat shrinkable film manufacturers have to gradually increase ex-factory product prices to maintain normal operation and absorb part of the cost pressure. After the product price rises, the packaging costs of downstream industries such as food, daily chemicals and logistics increase accordingly. Some downstream customers will appropriately reduce procurement volume or look for alternative packaging materials with higher cost performance, leading to a slowdown in short-term market demand for heat shrinkable film and slight fluctuations in industry orders.
3. Accelerated Differentiation of Industry Pattern and Prominent Advantages of Leading Enterprises
The cost pressure brought by rising crude oil prices has significantly different impacts on enterprises of different scales in the industry. Large heat shrinkable film manufacturers have advantages such as large-scale procurement, strong financial strength and stable supply chains. They can dilute costs through centralized procurement, optimizing production processes and locking in long-term raw material orders, and have stronger ability to resist price fluctuations. However, small, medium and micro enterprises are limited by small procurement volume, insufficient funds and low production efficiency, and have weak ability to withstand cost pressures. Some enterprises even face the risk of production reduction and shutdown, further accelerating the survival of the fittest in the industry.
4. Weakened Competitiveness in Foreign Trade Markets and Impact on Export Orders
China is a major producer and exporter of heat shrinkable film, with products sold to many countries and regions overseas. Rising crude oil prices have pushed up domestic product costs, gradually reducing the price advantage of domestic heat shrinkable film and putting it at a disadvantage in competition with similar overseas products in the international market. At the same time, the general rise in global energy prices has also reduced the purchasing willingness of overseas downstream customers, thereby affecting the export order volume of heat shrinkable film and further increasing the operating pressure on foreign trade-oriented manufacturers.
四、 Industry Countermeasures
Faced with multiple pressures brought by rising crude oil prices, heat shrinkable film enterprises have taken countermeasures one after another. On the one hand, optimize raw material procurement strategies to control raw material costs through long-term price locking, centralized procurement and diversified procurement channels. On the other hand, upgrade production processes, improve production efficiency, reduce production losses, and optimize product structure at the same time, focusing on high value-added products to enhance product premium capacity. In addition, enterprises will also establish long-term cooperation with downstream customers, negotiate to share cost pressures and stabilize supply and demand cooperation.
五、 Conclusion
As the source raw material of heat shrinkable film, the price fluctuation of crude oil affects the industry in all aspects including production, pricing, supply and demand, and competition. In the short term, the high price of crude oil will continue to bring cost and operating pressures to the heat shrinkable film industry. In the long run, this cost fluctuation will also promote the accelerated transformation and upgrading of the industry, forcing enterprises to improve cost control capabilities, optimize product structure, and drive the entire industry to develop towards large-scale, refined and efficient operation.