Flexible packaging raw material prices increased significantly during the second quarter of 2026, with geopolitical tensions, supply disruption and higher energy costs driving sharp rises across key materials.
According to the latest Flexible Packaging Europe (FPE) Raw Material Price Index, quarterly minimum prices increased across all substrates monitored compared with the previous quarter.
The largest increase was recorded for BOPP film (20 micron), where prices almost doubled, rising by 97 per cent compared with Q1 2026. PET film (12 micron) increased by around 40 per cent, while
biaxially-oriented polyamide (BOPA) film (15 micron) rose by 21 per cent. Aluminium foil (7 micron) became approximately 12 per cent more expensive, while one-side coated paper (60gsm) increased by just under 5 per cent.
PE markets also experienced strong price increases, with average HDPE prices rising by around 38 per cent and LDPE by around 31 per cent compared with the previous quarter. All materials monitored were trading above their levels from Q2 2025.
Higher oil prices
Alexander Tkachenko, research analyst at Wood Mackenzie, attributed the rise in BOPET prices, which increased by an average of €0.55/kg ($0.62) during the quarter, to higher oil prices and concerns over potential purified terephthalic acid and mono-ethylene glycol supply shortages.
“BOPP prices have nearly doubled over the same period, primarily due to a very tight PP resin supply in Europe, as inventories were already low before the onset of the conflict,” Tkachenko said.
BOPA film prices also increased significantly due to higher costs for PA6, PA66 and caprolactam, while aluminium foil prices rose by €0.62/kg [$0.71] during the quarter because of higher London Metal Exchange prices and substantially increased warehouse premiums.
“Paper prices rose by €0.06/kg [$0.068]; while paper is less directly affected by petrochemical market dynamics, sustained high oil and energy prices through the winter could lead to delayed cost increases driven by higher energy costs,” Tkachenko added.
The European PE market was also significantly affected by geopolitical developments during Q2 2026.
‘Significant volatility’
Kaushik Mitra, executive director of Europe plastics and polymers at Chemical Market Analytics by Opis, a Dow Jones Company, said the market experienced significant volatility because of the Iran crisis and the prospect of a supply shock in a market already characterised by low inventory levels.
“After remaining at relatively low levels from the second half of 2025 until February 2026, PE prices in Europe rose sharply in March,” Mitra said.
The increase continued through April and May as buyers prioritised securing material. Supply remained tight due to the displacement of production from the Middle East, while other international suppliers needed time to adjust their trade flows.
“Although European production gradually increased, incoming orders continued to exceed available supply,” Mitra said.
Prices plateaued in May as buyers shifted their focus from material availability to affordability following restocking. Increasingly competitive offers, particularly from China, strengthened buyers’ negotiating position.
“Although spot prices continued to decline during June, they remained above pre-crisis levels,” Mitra said.
The prospect of a potential peace agreement between the US and Iran was already affecting crude oil and feedstock prices, while reopening the Strait of Hormuz could help ease supply chain bottlenecks and contribute to a normalisation of supply in Europe.
Geopolitical events
FPE said developments during Q2 2026 highlighted the continued influence of geopolitical events and global trade flows on European raw material and packaging markets. However, recent declines in PE prices and expectations of improving supply conditions could indicate early signs of market stabilisation during the second half of the year.
Guido Aufdemkamp, executive director of FPE, said: “The second quarter of 2026 was characterised by exceptional price increases across almost all key packaging substrates.”
The increases were driven by geopolitical supply risks, rising energy and raw material costs, and uncertainty across global supply chains. However, European suppliers of flexible packaging were generally able to deliver all requested volumes.
“Overall, the volume market outlook is cautiously optimistic for the rest of the year assuming stabilisation of the geopolitical situation,” Aufdemkamp said.
He added that the industry remained concerned about the impact of food inflation on private consumption.
