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In Europe, perfume and cosmetics makers are facing input shortages as Russia’s invasion of Ukraine adds further disruption to supply chains in an industry whose demand has been on the rise.
The European beauty industry uses alcohol derived from grains and organic beets to make perfumes, as well as sunflower seed oils to make cosmetics, all key crops in the two countries at war: Russia and Ukraine.
For this reason, the war has led to an unusual increase in costs for producers, who have been facing growing demand since the start of the Covid-19 pandemic.
Paper, glass, and some key oils and alcohols for the cosmetics industry have been affected, either by disruptions to supply chains, or by high electricity prices stemming from the conflict.
Inputs used to make not just cosmetics but luxury jars and rigid packaging are up 25 percent to 30 percent, according to consultancy Bain & Company.
“We face shortages and price increases every step of the way: from scents and alcohol to glass and paper, even for spray dispenser pumps and the plastic used for caps,” said Marco Vidal, managing director of the fragrance maker. Venetian Mavive.
The challenges are mounting as consumers continue to purchase higher-priced beauty products, including perfumes made with a higher concentration of oils and unusual raw ingredients.
Worldwide sales of beauty products are forecast to top $538 billion this year, up from $518 billion in 2021 and $458 billion in 2020, a McKinsey report showed.
with Reuters
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