We’ve been tracking the costs of China raw materials since early 2021 in order for importers to have a clearer idea of the market in China and allow you to plan ahead if prices for your essential materials seem to be on the up (for instance, you may decide to buy up some inventory in advance to insulate yourself from further rises).
Here’s the up-to-date material cost data from China for you as of late July 2022:
As we mentioned in the last instalment of this series, raw material prices might start to rebound if manufacturing activities and customer demand increase.
As you can see, costs have stayed around the same or even fallen slightly since late May. In fact, only Zinc alloy and PVC have risen slightly while the other materials have actually fallen for the most part.
- Epoxy resin, -2.72% – Poor market demand, inventory pressure, and weak purchasing enthusiasm result in the decrease.
- ABS, -1.18% – Slow downstream digestion, manufacturers continue to accumulate inventory.
- Silicone, -1.65% – The market is weak and price shock falls, there is an imbalance between supply and demand.
- Zinc Alloy, +1.38% – The current overall market demand is weak.
- AL Alloy, -1.19% – Market pessimism has eased slightly.
- PVC, +0.45% – The PVC market atmosphere is still acceptable, futures shock slightly up, and spot transactions improved.
- Paper for color boxes, 0.0% – no change.
- Paper for cartons, -2.05% – Market demand is also poor, inventory pressure continues to be high.
- Stainless Steel, -2.11% – The market still maintains a cautious atmosphere, traders continue to be positive, and the overall trading is normal.
- Battery (Lithium Cobalt Oxides), 0.0% – no change.
Overall we seem to have entered a period of relative stability on costs, albeit at a higher general level than a year or so ago. Nonetheless, you can still use this information as general guidance to double-check that the price your supplier is giving you is reasonable (especially if they raise prices unexpectedly).
How to combat the rising costs?
Explore cost-reducing tips in this post: Rising Raw Material Prices: What Strategy To Follow? (6 Approaches).
What to do if your Chinese supplier suddenly tells you that material costs have risen: How To Cooperate With Your Chinese Supplier, Part 16: Bad News from China, Raw Material Prices Just Increased!
If your supplier just isn’t working out, maybe sourcing a new supplier will help you find one who can offer you better prices and more? If so, there’s no need to fear switching from your current supplier to a new one if you’re prepared: How To Switch To A Newer, Better Chinese Manufacturer? [eBook].
We hope this is helpful. Our mission at Sofeast is to help importers have transparency in their supply chain and to give them more control. And this information is critical to have some visibility into your manufacturer’s costing.
By the way, you can always contact us if you have any questions about whether a manufacturer’s quote is reasonable.