Pharma Industry
The Pharma Industry Facing A Massive Letdown Due To Aluminum Shortage
Pharma Industry
The pharma industry may have to suffer a massive letdown. Aluminum is the leading material used for manufacturing foils used for pharmaceutical drugs packaging. But of late, there has been a significant shortage of aluminum foil that has affected the supply chain big times. Procurement subcontractors, even with their experience, fail to negotiate on the pricing of the aluminum for foil production purposes. The price escalation has been primarily due to a shortage of material availability. And what's worse? Well, the production of many essential medical drugs has taken a halt.
THE SCENARIO OF PHARMACEUTICAL INDUSTRIES IN THE LAST COUPLE OF MONTHS In the last 5-6 months, there has been a rapid aluminum shortage. Pharmaceutical manufacturers are worried about the outcome of this shortage. Without the availability of aluminum in bulk for foil prediction, the pharma industry is going to face rapid level loss. Aluminum foil packaging is used for pharmaceutical drugs. Now, if suddenly there is a scarcity in package production, it will affect the pharma manufacturing sector. A loss in rapid production value is bound to take place. The price of drugs has increased because of this scenario. It is the consumers suffering badly due to such a scenario.
THE RAPID PRICE HIKE IN ALUMINUM FOILS The price escalation was noticeable within the last three to four months. There was a hike by 30% in pricing for the aluminum foils. So naturally, a lot of medical drug manufacturing processes stopped. How would they manage the cost? Then again, how much hike is possible for drug production even with a minimum profit margin? The scenario looks difficult and hence, many medical drugs were stopped from being produced. Pharma Industry
WHAT DO PROCUREMENT EXPERTS HAVE TO SAY? According to top-level procurement subcontractors, the major cause of the dispute is China where the production of aluminum foils hit hard. It was because of the shortage of power along with the implementation of several measures to reduce carbon footprint. All these areas are of major concern and we don’t know yet when things will normalize. With domestic producers eyeing exports, things have become even more complicated. Suddenly, there seems to be a shortage in raw aluminum required for the manufacturing of packaging foils.
WHAT’S IN STORE?
With October coming to an end, the supply of aluminum has yet to reach the required rate compared to the domestic demands. Even after consulting eminent procurement freelancer UK, sound strategic solutions cannot be sorted out. At present, the supply of aluminum material for foil manufacturing is no more than 50% of the total demand in the market. The scenario was similar in the last couple of months, and it’s expected that the year will end similarly. Only time will tell when the market will rise and witness some improvements.