Global unrest and severe supply chain issues have triggered an unprecedented surge in food packaging costs across Europe, sparking fears of a renewed spike in supermarket grocery inflation.
Figures from the Flexible Packaging Europe (FPE) Raw Material Price Index show that the second quarter of 2026 brought rapid price rises across every major packaging material.
The crisis, largely driven by shipping disruptions around the Strait of Hormuz, has heavily hit an industry reliant on plastics, foils and paper to keep everyday food products fresh.
The supply chain shock
This sudden market shift resulted from a clash of low European material stocks and disrupted Middle Eastern production. As global threats emerged, buyers abandoned cost negotiations in a panic to secure vital supplies.
This rush buying caused raw manufacturing materials to skyrocket within weeks:
- BOPP plastic film surged by 97% owing to severe European resin shortages.
- PET plastic film rose by 40%, driven by rising global oil prices.
- HDPE and LDPE packaging jumped 38% and 31% respectively, as buyers prioritised supply over cost.
Even materials less reliant on oil, such as aluminium foil, felt the squeeze due to soaring warehouse storage premiums and sustained high energy costs, with prices increasing by 12%.
Impact on supermarket aisles
While European suppliers have managed to maintain delivery volumes without major factory closures, the severe financial impact is now rippling down the supply chain.
Food and drink manufacturers cannot absorb these double-digit increases indefinitely. Consequently, industry bodies like the Food and Drink Federation (FDF) have revised their late-2026 UK food inflation forecasts to 9% or higher. The primary concern for brands is “shelf shock”, the risk that impending retail price hikes will severely hurt consumer spending.
For food producers aiming to navigate this market volatility, securing reliable, cost-effective packaging has become more critical than ever to protect their tightening profit margins.
Is the peak behind us?
There are early signs that the worst of these sudden price spikes may have plateaued. Late June data indicates that as buyers shift their focus back to affordability, more competitive offers from international markets are helping spot prices ease.
If supply chain bottlenecks continue to clear alongside the gradual reopening of the Strait of Hormuz, packaging prices should normalise towards the end of 2026. However, because baseline costs remain well above pre-crisis levels, the food industry must prepare for elevated overheads to persist well into the autumn.
