Cost Flux Got You Perplexed?

The What, Why and What’s Next of Fluctuating Material Costs

Nobody likes surprises, especially when it comes to costs.

Businesses across Canada have spent the last few years navigating supply chain disruptions, inflation, transportation volatility, and shifting trade policies. According to Statistics Canada, the Raw Materials Price Index was 18.1% higher year over year in July 2026, reflecting the rising cost of many of the materials used to manufacture products across Canada.

For packaging materials, price increases are linked to factors that exist beyond the warehouse floor. Tariffs, freight costs, fuel prices, and raw material availability all affect the cost to manufacture, source, and deliver products.

Why are costs increasing?

1. Materials now cost more to make.

Packaging products such as stretch wrap, shrink film, poly bags, and protective packaging are manufactured using resin and other petroleum-based materials. When energy markets fluctuate and fossil fuel prices rise, the cost of producing those materials rises with them.

Manufacturers also face increasing costs for utilities, labour, and processing, all of which contribute to the final cost of the products businesses rely on every day.

2. Goods now cost more to transport.

Getting products from the manufacturer to your facility is a major part of the overall cost equation. Fuel prices, freight rates, driver availability, and transportation demand all influence what it costs to move goods across Canada.

According to the Canadian General Freight Index, fuel surcharges represented 34.01% of base freight costs in June 2026, compared to 22.76% the previous year.

At the same time, transportation providers continue to face labour shortages. Canada’s truck transportation sector reported a 4.7% job vacancy rate in Q1 of 2026, above the national average of 2.7% across other industries.

3. Tariffs and trade policies continue to shape pricing.

Tariffs applied to imported products or raw materials and changes in global trade agreements create additional costs neither manufacturers nor customers can avoid.

The impact can be significant. Recent tariff reviews identified more than 500 Canadian and 700 American products potentially affected by tariff-related cost increases.

In 2025, Canada’s countermeasures applied 25% tariffs on approximately $29.8 billion worth of U.S. imports, including several packaging-related categories: corrugated packaging, paperboard cartons, boxes, bags, lids, and closures.

How do you manage costs?

Markets change, costs fluctuate, and some increases are unavoidable. But that doesn’t mean you’re out of options. Some of the biggest opportunities to manage costs come from looking at how materials are being used in the first place.

For example, using a film gauge that’s heavier than required, over-packaging products, or applying more material than necessary can increase costs over time without improving protection or performance.

Questions worth asking include:

• Are you using the right packaging for the application?
• Could a different material reduce waste without sacrificing performance?
• Is your packaging equipment operating as efficiently as possible?
• Are products being over-packaged or over-specified?
• Could a packaging line adjustment reduce material consumption?

Many businesses are responding by:

• Re-evaluating packaging specifications to eliminate unnecessary material usage
• Switching to alternative materials that deliver comparable performance
• Right-sizing packaging to reduce waste and shipping costs
• Standardizing packaging across facilities to improve purchasing efficiency
• Reviewing sourcing strategies to reduce exposure to market fluctuations

Focus on What You Can Control

Raw material costs will continue to fluctuate. Freight rates will rise and fall. Tariffs and trade policies will evolve. Those factors are outside everyone’s control.

Fortunately, you don’t have to navigate these challenges alone. Our packaging and equipment experts will assess your packaging lines, equipment performance, material usage, and packaging design to uncover inefficiencies. And with access to a global supplier network, we will identify comparable alternatives that deliver the performance you need while managing costs.

Browse our product selection or contact us to have an expert help you package better, smarter and faster.