Sign Up
..... Australian Property Network. It's All About Property!
Categories

Posted: 2020-03-02 05:56:04

"We're very resilient, Aussies tend to find a way, but I would think definitely there would be some holes appearing in production of products if this is still the same in three weeks time."

Biscuit trays and other food packaging is predominantly made from Polyethylene terephthalate (PET). China accounts for about 30 per cent of global PET production, and the rest of Asia makes up a further 21 per cent.

If we had to go without a chocolate biscuit but we could get plenty of broccoli and carrots, life will still go on.

Ritchies chief executive Fred Harrison

Mr Harrison's comments come as some consumers stock up on non-perishable items such as pasta, oats and beans. Major supermarkets reported an increase in shoppers buying pantry items and images circulated online of bare shelves as a temporary increase in demand depleted supply.

Supermarket giants Woolworths and Coles confirmed demand had risen over the weekend but assured shoppers that distribution centres had high stock levels and they were working to replenish shelves as quickly as possible.

Supermarkets source their products from a number of countries, with a minority typically coming from China. Woolworths chief executive Brad Banducci said last week the company could comfortably look at other sources for food, including Australia, if shortages did occur.

However, Mr Banducci also flagged potential issues in packaging coming out of China, as did chief executive of Foodland Supermarkets Con Sciacca. His 90 supermarkets source a majority of Australian products but have been warned of packaging shortages.

Ritchies Supa IGA chief executive Fred Harrison.

Ritchies Supa IGA chief executive Fred Harrison.Credit:Simon Schluter

"We're very focused on supplying as much Australian product as we can, which to some degree provides a buffer, but even those suppliers rely on Chinese-supplied packaging," he said.

"Every supplier to some degree will be impacted by packaging imports for their products."

The Age and The Sydney Morning Herald is aware Detmold, a major producer of packaging for companies such as McDonald's and Subway, recently warned suppliers of potential shortages.

A spokesperson said the company was concerned about getting its manufacturing workforce back to work following the virus, which would have impacted the company's entire range of paper and board packaging.

"We have been successfully working with local authorities in China to have our staff return safely to work, and now we are back to full supply levels," the spokesperson said.

Pact Group, an ASX-listed company which supplies a significant amount of consumer packaging, referred The Age and The Herald to a statement from February 4 which said the company had not been notified of any supply related issues.

However, despite these potential issues, Mr Harrison thinks it's unlikely Australia will see any widespread food shortages to the extent stockpiling becomes necessary, as fresh food and other products will still be widely available.

"When it's all said and done if we had to go without a chocolate biscuit but we could get plenty of broccoli and carrots, life will still go on," he said.

A spokesperson for biscuit maker Arnott's said the company sources the majority of its packaging from Australia and there was "no current disruption to our supply", though it continued to monitor the situation closely.

View More
  • 0 Comment(s)
Captcha Challenge
Reload Image
Type in the verification code above