Special to Global Toy News from Wai Or, Managing Director of Longshore Limited,a Hong Kong based OEM manufacturer and sourcing agency,
The big electronics giant Foxconn (who produced many Apple products) had a rash of suicides and the factory increased its wage level which had an overall impact on most factories in the Pearl River Delta area, as Foxconn employed over 400,000 staff in total. We expect the labor cost to continue rising in the near future.
On the raw material side, the Thailand political unrest (Red Shirt Movement) caused significant supply interruption on IPRC/TPI plastics (including ABS #850). Then, recently a fire accident broke out at a major Taiwanese petrochemical plant and this may soon have an effect on the supply of Taiwanese plastics such as ABS #15A1 and #757. These factors combined and created a (hopefully temporary) shortage in the market over the recent weeks, and at the same time we observed a spike the ABS price.