The recent increase in Covid-19 cases in Southeast Asia has choked ports and locked down plantations, pushing for extended disruptions of raw materials such as palm, coffee, and tin.
- Restrictions in Malaysia have prevented migrant laborers from traveling to plantations, raising prices of the ubiquitous edible oil used to make candy bars, shampoo, and biofuel.
- Lockdowns in Vietnam have delayed the processing and export of coffee beans, adding to production concerns caused by poor weather in Brazil.
- The global tin supply has been affected by Covid-19-related interruptions at a smelter in Malaysia, contributing to higher prices for the industrial metal, which is used to connect computer chips to circuit boards in electronics.
- Prices for each of the commodities have increased to multi-year highs in recent months, adding costs that are being passed on to consumers.
Businesses including Unilever PLC and J.M. Smucker Co., which includes Folgers coffee, have stated that increasing prices of raw materials are contributing to cost pressures.
ULVR up +0.038%, SJM down -0.01%Source: WSJ.