Packaging firm warns of rising prices if pound continues to fall
As the pound continues to weaken following the UK’s decision to leave the EU, fears are spreading that the price of packaging could rise significantly.
South African paper packaging giant Mondi has indicated that many of its UK contracts, on products such as Twinings Tea, contained clauses that meant they could be recalculated in light of currency fluctuations. The result could see the price of packaging continue to rise as the pound continues to decrease in value.
Mondi’s chief executive David Hathorn said: “We export many of our products from Europe to the UK and most these contracts have currency agreements in place, so they have been repriced to take in the currency movements.”
The company, which has a presence North and South of the border in Ireland, expects prices for its products to improve worldwide after tougher trading conditions this year.
If sterling continues to devalue, then the expectation is that these higher packaging costs may be passed onto the customer.
