Bulk Bag Costs Explained

We’re often asked by our customers to explain the wide variability in pricing from one bag to the next. Unfortunately, there is no one-size-fits-all answer.

The following cost information is intended to assist purchasers in identifying, comparing, and choosing a flexible intermediate bulk container (FIBC) that offers the desired level of value. Continue reading as we break down key industry terms to simplify your bulk bag purchasing process. 

Basic Bulk Bag Cost Components 

Direct Materials

The largest cost component of a bulk bag is resin. Raw materials including fabric, webbing, and sewing thread are derivatives of petroleum-based resins. Consequently, the price of raw materials fluctuates with oil and gas prices. 

Direct Labor

Bag production is a labor-intensive process requiring a high level of skill and experience. While resin extrusion and fabric weaving are fully automated, bag stitching remains a manual process. In a typical production line, 10 to 20 workers will handle cutting, stitching, quality control, and packing. Large plants can employ hundreds to thousands of workers. 

That said, labor rates vary greatly from country to country. The competitive labor advantage has driven the bulk of bag production overseas to India, China, and Turkey. Direct labor costs are the least expensive in those countries, with Mexico and the U.S. respectively seeing climbing labor costs.

Still, disproportionately low wages allow the direct labor cost component of a bulk bag to remain marginal.     

Manufacturing Overhead

Overhead manufacturing costs can include equipment, buildings, utilities, and factory management salaries. Indirect costs to convert raw materials — including extrusion, weaving, and sewing machines — are dependent on the current cost of natural gas and electricity.

Not all plants are created equal. For example, state-of-the-art production facilities with Safe Quality Food (SQF) cleanliness standards may incur significantly higher overhead costs than basic industrial bag facilities. 

Understanding the quality and production capabilities of the plants that produce your bag is critical when sourcing the right bag for your business. 

Plant Profit

This is the money remaining after all manufacturing and administrative costs are incurred. 

Import Tariffs

FIBCs are subject to import tariffs (under HTS Code 6305.32.0010) when imported from certain overseas countries. In general, the import tariff on bulk bags is equal to 8.4% of the commercial value of the bags. Additional surcharges and fees apply, bringing the average total tariff to approximately 9%.

Recently, additional tariffs were imposed on Chinese-manufactured FIBCs. This raised the total tariff to over 23.4%. Trade relations between China and the United States continue to evolve, and duties will likely be reduced at some point in the future. Nevertheless, tariffs are a material cost component of an imported bag.

Foreign Exchange (FOREX)

The value of the dollar versus foreign currencies can impact the cost of an imported bag. A strong dollar equals cheaper overseas bulk bags. 

Ocean Freight

Imported bulk bags are shipped from the manufacturing plant to the United States in 20’ and 40’ sea containers. Ocean freight is a significant cost component of a bulk bag. Freight from India and China to the United States can range from $3,000 to $5,000 per container. 

Port and Broker Fees

Imported bulk bags are handled by freight and customs brokers to gain entry into the United States. Charges for these services generally are generally nominal.

Over-the-Road Freight

Once the sea container arrives at the U.S. port, it must be transported over the road to the distributor or end-user’s location. Major ports of entry include Houston, Long Beach, New Orleans, and Savannah. Oftentimes, the container may be shipped via rail to the nearest customer rail ramp, then offloaded and delivered via truck.
 

Warehousing

In many cases, customers elect to leverage a distributor’s warehouse to store bags for an extended period. This eliminates the typical 12- to 16-week lead time for normal bag production. 

Distributors factor expenses such as rent, utilities, forklifts, taxes, and personnel wages into the warehousing cost component of the bag price. Warehousing costs typically add 4% to 8% to the price of a bag.

Distributor Profit

Profit margins are determined by the volume of product needed, the difficulty in manufacturing the required product, and the customer’s creditworthiness.

Raw Material and Design Cost Drivers for Bulk Bags

There are 14 major parameters of a bulk bag that determine the overall cost. 

1. Bag Type

Four main bag types play a role in the overall bulk bag cost. When selecting a bag type, Circular is the cheapest option followed by U-Panel, 4-Panel, and Baffled in that order.

The graph below showcases the different bag types.  

2. Bag Size

Bag size is a more obvious cost factor. The bigger the bag, the bigger the cost. Smaller bags will be cheaper due to the amount of material being spared. 

3. Fabric Weight

Another FIBC cost factor is fabric weight. The heavier the fabric used, the more expensive the bulk bag may be. Heavier fabrics are recommended for certain products. Contact our sales team to help determine which fabric weight is right for you and your business. 

4. Fabric Type

Fabric type classifications help customers choose the appropriate bulk bag for specific materials and environments based on their electrostatic properties and safety requirements.

• Type A bags are made from non-conductive materials and offer no protection against static electricity.
  
  
• Type B bags are constructed from non-conductive materials but have a breakdown voltage of less than 6 kV, making them suitable for use in environments where flammable gases or dust are present.
  
  
• Type C bags are made from non-conductive materials but incorporate interconnected and static-conductive threads to dissipate static electricity, reducing the risk of sparks.
  
  
• Type D bags are constructed using static-dissipative fabrics, providing enhanced safety by preventing the occurrence of incendiary discharges in environments where flammable materials are present.

5. Fabric Lamination 

Some bulk bags feature coatings or laminations to enhance specific properties such as water resistance, UV protection, or static dissipation. These coatings add an extra layer of cost to the fabric.

Coated fabrics are more expensive than their non-coated counterparts, as the coating materials contribute to both the functionality and durability of the bag.

6. Safe Working Load/Safety Factor Requirements 

Safe Working Load (SWL) is a function of fabric weight. As SWL increases, the fabric weight required to support the load must increase, resulting in a more expensive bag. For example, a bag with a safety factor (SF) of 6:1 is more costly than a bag with a 5:1 SF.

7. Top Style and Size 

Duffle tops tend to make for more expensive bulk bags, followed by spout tops and then open tops as the least costly. For spout tops, the price is determined based on the size of the spout requested. Learn more about FIBC top styles here.

8. Bottom Style and Size

Similar to top style and size, flat bottoms incur the least cost. Spout discharge bottoms are slightly more expensive, and full-open dump bags are one of the priciest bottom styles. For spout discharges, the price is determined based on the size of the spout requested.

9. Seams

The following seam types are ordered from least to most expensive:

• Standard
• Sift Proof
• Double Sift Proof
• Triple Sift Proof (Felt)
  
  
  

10. Lift Loops/Stevedore Straps

For lift loops, the price is determined based on the size and amount of webbing required. Stevedore straps are an additional cost if required.

11. Liner

Several liner characteristics impact cost. Both the liner’s thickness in millimeters and its color affect the total price of the FIBC.

Material also plays a role; polyethylene (PE) liners, followed by polypropylene (PP) and then foil, represent the least expensive to the most expensive liner type. Additionally, whether the liner is loosely inserted, tabbed in, sewn in, or glued in dictates its cost. Loosely inserted liners are typically the least expensive, while glued-in liners tend to be the priciest.

12. Document Pouches

When it comes to document pouches, cost is determined primarily by the quantity and whether it features a standard open or a zip lock, with zip locks being the more expensive option.

13. Clean Level

Costs relating to clean level are highest for pharmaceutical-grade bags. Industrial grade is the least expensive, and food grade is in the middle.

14. Country of Origin

Bags from India tend to be the most economical, followed by China, Mexico, and the U.S.

Choose an FIBC That's Right for Your Business

Understanding the diverse components that contribute to bulk bag costs is essential for businesses seeking efficient and cost-effective packaging solutions. By recognizing how each factor impacts the overall cost, customers can make informed decisions when selecting bulk bags that align with their specific needs and industry requirements.

We went into detail about the different bulk bag cost components and drivers — now what? Connect with our team of bulk bag specialists today to find the right FIBC for your business.