INFLATION IMPACTS THE WORKWEAR AND EPI INDUSTRY
INFLATION IMPACTS THE WORKWEAR AND EPI INDUSTRY

The workwear and PPE industry is impacted by inflation and cost rises due to increases in raw materials, gas, and energy.

Factors for the increase in workwear and protective clothing prices are attributed to the crisis in container shipping, and the energy crisis in Europe due to the war in Ukraine.

Problems in the supply chains

For most of 2020 and 2021, the world came to a pause because of the COVID-19 health crisis. A domino effect of this crisis has been felt. Many companies had to reduce their staff or close down.
Even if at the end of 2021, the economic activity returned to normal, the impact of the pandemic has highlighted problems in many supply chains.
Today, supply chains are confronted with enormous challenges, including a global imbalance between supply and demand. The supply of workwear and PPE are also affected by this situation.

The reasons for the crisis

  • According to the latest Commodity Markets Outlook report published by the World Bank in April, energy prices are forecast to rise by more than 50 percent in 2022 before declining in 2023 and 2024.
  • Energy affects every part of the apparel supply chain, from production to transportation.
  • Demand exceeded the offer. Before the pandemic, the demand for cotton declined, so the producers naturally reduced their supply capacity. However, the high levels of PPE needs during the pandemic created a high level of demand for cotton textiles, which continues.

The war between Russia and Ukraine

The Russian invasion of Ukraine has unfortunately resulted in an unprecedented impact on global supply chains from wheat to grains, sunflower oil to fuel.

This war has also led to greater demand in the protective apparel and PPE industry for aramid fibers, which are used for military applications, including ballistic helmets and body armor.

The increased demand for these products and materials has impacted supply, resulting in higher prices.

The cotton price increase

Cotton is the most used natural fiber in the world for quality protective clothing. However, cotton prices have increased by 40% in 2022, and the price of raw cotton has increased by more than 78% in the last 12 months. It is obvious, that the cost of personal protective equipment (PPE) and branded workwear will also increase.

According to the report of the World Bank – Global Commodities Market Outlook – the price of cotton was 1.59 US dollars per kilo in 2020, and 3.10 US dollars per kilo in 2022. Prices have already increased, and cotton will soon reach its highest level in 11 years.

The workwear and safety garments manufacturers are already feeling the impact. With the rising cost of cotton, energy usage for processing, and fuel costs for transportation and shipping, the purchasing and distribution costs for businesses have significantly increased in 2022.

Solutions for PPE Manufacturers and Buyers

Today’s supply chain challenges require manufacturers and suppliers to adapt quickly. Therefore, it’s important to anticipate and find solutions.  This may include close collaboration between purchasers and manufacturers of workwear and PPE, who can forecast their stock projections and therefore source raw materials for full-year manufacturing. This can help to ensure more competitive prices!