Reichhold Announces Price Increases for Coating Resins

Rising costs for raw materials prompt hike for products sold in U.S., Canadian markets

Rising costs for raw materials prompt hike for products sold in U.S., Canadian markets

Research Triangle Park, NC — November 12, 2004 — Resins company Reichhold this week announced price increases across all coating resin product lines sold in the U.S. and Canadian markets as high demand for raw materials continues to drive up costs in this market sector.

Specific increases at Reichhold include $0.05 per pound on all solvent-based coating resins as well as emulsion and dispersion chemistries, with the exception of epoxy resins and curing agents, which will increase by $0.08 - $0.10 per pound. Polyester powder coating resins are also included and will increase by $0.10 per pound, while GMA acrylic powders are not affected, according to the resins company.

These increases are being applied to both list and off-list prices and are effective for all U.S. and Canadian orders shipped on or after December 15, Reichhold said.

"As industrial demand for coatings-related monomers continues to outstrip supply, especially in the area of acrylates, we are continually being hit with increases on these materials which are key in the production of our resins," explained Tony Rende, Reichhold's product director for global coatings.

"This is only compounded by price hikes that we're seeing across other primary raw materials such as phthalic anhydride, xylene, TDI and linseed oil to name a few," continued Rende. "With crude oil and natural gas pricing hovering around record levels, it's evident that there is no immediate relief in sight for raw material or energy costs."

Rende said that while Reichhold is sensitive to the fact that it has had to announce more price increases this year than in the past, the company is simply responding to the burden that's being placed on it by current market conditions, "and, like anyone else in the supply chain, we have to maintain a profit to stay in business."

Founded in 1927, Reichhold, with its world headquarters and technology center in Research Triangle Park, N.C., is, together with its parent, Japan's Dainippon Ink & Chemicals, the world's largest manufacturer of unsaturated polyester resins and a leading supplier of coating resins for the industrial, transportation, building and construction, and other markets.

Rising supply costs have hit steel, paper, plastics and other markets, and many companies are facing the Hobson's choice of paying the higher prices or going without supply. For a look at how some companies are confronting this challenge, read the article "The Blowback of Reverse Auctions," the Final Thoughts column in the October/November 2004 issue of Supply & Demand Chain Executive.