Raw materials are causing a ripple effect that starts with rubber, chemical suppliers is the headline from a recent article in Rubber & Plastics most recent issue. Here’s an excerpt:

“Recent rubber price increases generally have stuck because customers really don’t have any other choices, said Bill Hyde, director of C4 olefins and elastomers for Houston-based Chemical Marketing Associates Inc.

Producers have been able to push through some substantial increases, and no one rubber producer is exposed more than another because they’re all exposed to cost-push and feedstock limitation issues, he said.

While there is more natural rubber available compared to synthetic rubber—which is experiencing some record highs in pricing—NR prices are actually higher, Hyde said. With the tightness of supply in North America, importing SBR would seem to be a viable alternative, except that supply in regions like Asia is even tighter and the prices are higher.

In the case of highly engineered rubber products, where the specifications are tight, manufacturers really can’t move back and forth on materials, Hyde said.

“There’s a widespread shortage of synthetic rubber,” he said. “Polybutadiene and SBR producers have been allocating 50-90 percent of contract levels since February here in the U.S. In the short term, there aren’t a lot of other options.””