US Gelatin Market Braces for Price Hike Amid Supply Chain Woes and Strong Demand

The prices of Gelatin are expected to remain elevated by the close of September in the USA, with a further upward trend anticipated in October. This projected increase is fueled by steady demand from end-user sectors, geopolitical tensions, and a constricted supply chain. As these dynamics unfold, sellers in the market are likely to adjust their pricing strategies upwards, contributing to a more optimistic market outlook.

The looming threat of dockworker strikes at major U.S. ports on the East and Gulf Coasts, including New York-New Jersey, Savannah, and Houston, could significantly contribute to the increase in Gelatin prices in the USA. Anticipating potential disruptions, businesses have been accelerating imports and redirecting cargo to avoid delays, creating a surge in demand for shipping services. Importers have even begun ordering seasonal goods, like Christmas items, months earlier than usual to ensure timely arrivals ahead of the strike deadline on October 1, when the labor contract between port terminal operators and the ILA (International Longshoremen’s Association) expires. This rush to secure goods before the potential strike has tightened supply chains and increased transportation costs, adding upward pressure on Gelatin prices.

Moreover, the diversion of shipments to West Coast ports, such as Long Beach and Los Angeles, due to the potential strikes on the East and Gulf Coasts, could also contribute to an increase in Gelatin prices in the USA. As these West Coast ports are already operating at peak capacity, handling container volumes comparable to the pandemic shipping boom of 2021-22, the influx of additional cargo threatens to overwhelm their operations. This congestion can lead to significant delays and increased freight costs as shippers face longer wait times and heightened competition for available space. The resulting spike in transportation expenses and the bottleneck in supply chains will push up overall logistics costs, directly impacting the pricing of imported goods, including Gelatin.

From an economic perspective, the surge in consumer sentiment in the USA to a four-month high in September, driven by improved perceptions of the economy and easing inflation concerns, is likely to contribute to rising Gelatin prices. Although optimism about the labor market has slightly dipped, the overall boost in consumer confidence is expected to stimulate higher demand for various goods, including Gelatin.

According to ChemAnalyst, Gelatin prices are expected to stay elevated in the latter months of the year, largely due to strong demand from the food, beverage, and pharmaceutical sectors. Gelatin’s extensive use in various food items, especially during peak festive periods such as Thanksgiving and Christmas, is likely to sustain high demand. As these holidays approach, consumer consumption typically rises, which in turn could drive Gelatin prices higher in the U.S. market.