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SUPPLY CHAIN DELAYS EXPECTED DUE TO WINTER STORMS IN THE GULF REGIONMatthew Bodoff on 3/1/21 In an article on February 24th, Clay Boswell wrote for Chemical Week, winter storms in the gulf region have caused shutdowns to most petrochemical plants in the US. In addition, those plants which were shutdown in rapid response to the storm, may have suffered increased damages and take longer to be back up and running. US propylene capacity was already low prior to the storm and with an estimated 60-65% production shutdown, the outlook is even worse. In addition, almost 80% of the nation’s polyethylene supply is offline. This will most definitely impact the current quartz supply stream. As was shared at last week’s ISFA Mixer networking event by Matthew Bodoff, “The delays and damage to this industry affect the entire chemical supply chain including manufacturers of polyester resins like INEOS and others. This means material shortages and price increases can have a ripple effect on domestic quartz and solid surface producers. UPR resin prices have increased 15-20% since the Fall. And since quartz slab costs are so heavily influenced by the resin cost, there is a likely chance these raw material increases will trickle down and affect the price of quartz slabs in the market."
Fabricators have shared that they are already facing challenges with inventory for many products, due to shipping delays. In fact, in an article by Greg Miller in FreightWaves, container ships are backed up off the Coast of California currently. As of late last week, 25 container ships were at birth with another 32 waiting anchored at LA and Long Beach. Ships had been waiting on average a week since the end of January. However, some have recently seen this increase to 11-12 days. As the backup continues, this timeframe will no doubt also increase. These delays have also forced ocean carriers to cancel sailings due to the lack of ships. Add to all of this, COVID infections among dockworkers hit over 800 in January, affecting the available workforce once these ships do port. These factors add up to what could be an unprecedented increase in material prices and lead times, specifically for both quartz and solid surface categories. ISFA is keeping a pulse on these supply-chain challenges and will continue to update our members. To learn more, full articles and related links here:
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