At a very high price, the second wave of the Covid-19 pandemic has knocked a little bit of sense into the heads of the Indian packaging industry. The Indian packaging industry was lucky in the first wave of the pandemic. Declaring itself as a supplier to the essentials goods supply chain, it quickly overcame the bureaucracy of permits, set up some safety protocols, and churned out packaging for food and pharma. Some factories didn’t even close for a day.
There was an unprecedented demand for sanitizers, and the container, pouch, and label segments got busy. The need for hygienic food and food commodities kept flexible packaging strong. The demand for vaccine vials, medical equipment, and other pharma products kept the glass container and carton industry in good shape. The requirements of home delivery and eCommerce kept the corrugated sector buzzing. However, it complained about the high price of liner inputs, some of which were exported to meet China’s insatiable demand.
However, even last year, not everything was hunky-dory, although it was considered impolite to say so. The closure of shops, airports, train stations, restaurants, malls, schools, colleges, and postal services was disastrous for commercial printing and publication printing. The crisis of an adjacent industry that shares much of the same technology and materials has helped increase the price of raw materials for packaging, for instance, paper, inks, coatings, and solvents. It has also lead to many commercial printers necessarily entering board packaging, which will keep carton pricing hyper-competitive for several years.
Many of our friends turned economists remained confident of a quick recovery for the economy after the pandemic year. Of course, budding industrial economists had nothing intelligent to say about labor migration or a union budget spending little on health and education.
It was natural even for more calibrated optimists to look for renewal in the new financial year from April 2021. Although there was plenty of evidence, few anticipated that China’s rapid economic recovery or growth in the past year would be so comprehensive and that it would dominate exports, raw material supply chains, and logistics. Chinese manufacturing became more dominant to the extent that not only are most raw materials in short supply, but one cannot even get a container to bring in purchased goods – in time, without excellent planning.
The second wave of the pandemic has unfortunately extracted a far higher price. One label press manufacturer aptly described it as a Tsunami. It brought death and disaster into our factories and homes – often, the scramble for oxygen or a hospital bed or a vial of medicine made us question our existence, tolerance, and priorities. The lesson that emerged is that it is better to shut down production or work minimally or not all than to risk a single life, even if it is not your own.
Another learning, at least for the label industry, was that short-run labels and multiple changeovers are not only endemic in the pandemic but a fact of life in the future. “If you didn’t learn the importance of having a digital label press in this pandemic – there is little chance . . . .”
Speaking to another industry supplier in this terrible month of May, one learns that the packaging industry is not as buoyant as in the previous year. The self-reliance and deep resources of the population have been worn thin by the idleness of many industries. The packaging industry may have to learn that food, pharma, and hygiene can only take you so far.
Nevertheless, the overall interest and investment by the packaging industry in modernizing and high technology remain intact. A surprising number of packaging equipment and machines are awaiting installation once the second wave subsides.
The packaging industry was lucky the first time. While not so fortunate in the second wave, it will have to – like every industry – acknowledge that it is only a part of a more significant paradigm. In the long term, it cannot survive without paying attention to human welfare, society, and the economy as a whole.
Packaging also has the good fortune of having a great opportunity of demonstrating its value beyond the integrity of consumer products and hygiene. It can demonstrate its overall contribution to society by producing proportionately less and finally by cleaning up. By making itself recyclable and using renewable energy – these are no longer futuristic ideas.
This is the editorial republished from the Packaging South Asia May 2021 issue.