HARTSVILLE, SC - Nailed wooden reels will cost more, says Sonoco (NYSE: SON), which announced an 8.6 percent surcharge, effective July 1.
The upcharge is necessary to offset a steady increase in lumber costs over the past two years. Sonoco Reels are in great demand by wire and cable industries. Sonoco makes reels in nailed wood, plywood, poly-fibers, molded plastic and steel.
Greg Powell, Sonoco Reels general manager, says a surcharge is used rather than a price increase. "We feel lumber costs should soften later this year," said Powel. "Our plan will be to adjust the surcharge to reflect any future decline in lumber pricing."
However if lumber prices go the other way, Powell says, Sonoco Reels will raise the surcharge.
Sonoco says it also recycles wood reels, collecting 2 billion pounds of reels over five years, which it says saved end users more than $36 million in disposal costs, and 300,000 trees.