David Savastano, Editor04.02.20
As the world battles COVID-19, people are trying to find ways to make up for shortages in key items. Hand sanitizers are very difficult, if not virtually impossible, to find on shelves. This has led many people – my wife included – to make their own batches of hand sanitizers. There are formulations online.
However, getting the materials for this has also proven to be difficult. In the case of hand sanitizers, isopropyl alcohol is essential, and it is hard to get. As an example, Polymeric Group is making hand sanitizers on some of its ink manufacturing equipment, and it too is running into challenges in getting the necessary ingredients. Here is a graphic from SPG Global:
Source: SPG Globall
Turns out that the packaging ink industry is having a difficult time as well. This is particularly problematic as packaging inks are becoming more important, as people are staying home and buying the groceries they need to make meals. In the last 10 days, the following ink companies have announced price increase for solvent-based inks as of April 1, 2020:
• On March 26, 2020, Sun Chemical announced that it is implementing surcharges on solvent ink and varnishes in Europe. In particular, Sun Chemical cited ethanol as a serious concern.
“The current situation is causing considerable pressure on the supply chain of alcohols – in particular, ethanol,” the company stated. “With supply already limited in the second half of 2019 due to a bad crop of raw materials increasing the demand for fuel ethanol, the novel coronavirus (COVID-19) has caused further increased demand for pharmaceutical and sanitized products, with governments considering allocation measures.
“While availability is reducing globally, prices are increasing quickly,” Sun Chemical added. “To secure its supplies for the coming months, Sun Chemical has accepted higher prices to comply with current market conditions. The risk always exists that governments may seize the products for health emergency reasons – a situation that is beyond Sun Chemical’s control.”
“The pressure on the alcohol supply chain is causing an abrupt rise in raw material costs and unfortunately requires us to increase customer prices,” said Nicolas Bétin, director Product Strategy EMEA, Sun Chemical. “We will continue to work with our supply chain partners to manage and minimize the impact on our customers.”
• On March 27, 2020, the Doneck Network followed with solvent surcharges on solvent-based flexo and gravure inks. The compmay also noted that in order to secure its supply for the coming weeks, it had to accept price increases from solvent suppliers.
“Due to the coronavirus pandemic, there is a relevant shortage of solvents, especially ethanol and isopropyl alcohol, as the latter are used in pharmaceutical and disinfection products,” Doneck’s team reported.
• On March 30, 2020, Siegwerk implemented immediate surcharges on all solvent-based inks and varnishes in Europe, Middle East and Africa (EMEA).
“Certain raw materials, such as alcohol, have been impacted in terms of price and availability as a result of the novel coronavirus (COVID-19),” Siegwerk noted. “This is due to the increased need for products with disinfectant properties and the potential for government restrictions or allocation measures. Demand for these products, in particular ethanol, continues to outstrip supply, which has led to reduced global availability and rapid price increases.
“In addition, due to the industry shutdowns in China and India, disruptions to freight and logistics, and many other isolated supply disruptions, Siegwerk is not always able to avoid price increases without increased risk of supply disruption,” Siegwerk added. “Additionally, Siegwerk needs to be prepared in the event governments redirect products for medical purposes – a situation beyond the company’s control.”
• Also on March 30, 3020, Flint Group Packaging Inks Europe announced its own solvent surcharges on all solvent-based inks and coatings in Europe.
“The progressively worsening global economic situation caused by the coronavirus (COVID-19) pandemic is placing untenable pressure on the supply chain for packaging inks and coatings,” Flint Group announced. “Supply across a number of raw material categories, notably solvents, is tightening and costs are rising quickly as the market becomes more constrained. Additionally, freight constraints are resulting in higher costs across all transportation modes.”
Company officials noted that they are doing what they can. Flint Group, for example, noted that they have many employees who have been impacted by coronavirus.
“The worsening global situation caused by COVID-19 is having a significant impact on our business, yet our facilities continue to deliver consistent output despite major supply chain disruptions," said Kim Melander, VP and GM Packaging Inks Europe. "However, this output comes at a significant cost which to date we have borne alone. We remain optimistic that this surcharge is a temporary measure – we continue to monitor the situation closely and will stay in regular contact with our customers to discuss any further developments.”
Siegwerk emphasized the importance of the ink industry in our everyday lives.
“In order to ensure the continued supply of Siegwerk products, in every country in which we operate we have secured, or are in the process of securing, the official governmental confirmation of being part of the critical infrastructure industry as a key supplier to the food and pharma segments,” said Mike van Breugel, director global purchasing for Siegwerk. "Critical infrastructure industries have a special responsibility to maintain normal operations to deliver specific products associated with the safe distribution of food and medical products."
While Sun Chemical, Flint Group and Siegwerk noted that these price increases are being put in place for Europe, It would be surprising if they did not extend into the rest of the world eventually. It should also be noted that many other companies are undoubtedly raising their prices, but aren’t announcing the price increases. Tragically, the pandemic is continuing, and once we are finally clear, there will still be many challenges ahead.
However, getting the materials for this has also proven to be difficult. In the case of hand sanitizers, isopropyl alcohol is essential, and it is hard to get. As an example, Polymeric Group is making hand sanitizers on some of its ink manufacturing equipment, and it too is running into challenges in getting the necessary ingredients. Here is a graphic from SPG Global:
Source: SPG Globall
Turns out that the packaging ink industry is having a difficult time as well. This is particularly problematic as packaging inks are becoming more important, as people are staying home and buying the groceries they need to make meals. In the last 10 days, the following ink companies have announced price increase for solvent-based inks as of April 1, 2020:
• On March 26, 2020, Sun Chemical announced that it is implementing surcharges on solvent ink and varnishes in Europe. In particular, Sun Chemical cited ethanol as a serious concern.
“The current situation is causing considerable pressure on the supply chain of alcohols – in particular, ethanol,” the company stated. “With supply already limited in the second half of 2019 due to a bad crop of raw materials increasing the demand for fuel ethanol, the novel coronavirus (COVID-19) has caused further increased demand for pharmaceutical and sanitized products, with governments considering allocation measures.
“While availability is reducing globally, prices are increasing quickly,” Sun Chemical added. “To secure its supplies for the coming months, Sun Chemical has accepted higher prices to comply with current market conditions. The risk always exists that governments may seize the products for health emergency reasons – a situation that is beyond Sun Chemical’s control.”
“The pressure on the alcohol supply chain is causing an abrupt rise in raw material costs and unfortunately requires us to increase customer prices,” said Nicolas Bétin, director Product Strategy EMEA, Sun Chemical. “We will continue to work with our supply chain partners to manage and minimize the impact on our customers.”
• On March 27, 2020, the Doneck Network followed with solvent surcharges on solvent-based flexo and gravure inks. The compmay also noted that in order to secure its supply for the coming weeks, it had to accept price increases from solvent suppliers.
“Due to the coronavirus pandemic, there is a relevant shortage of solvents, especially ethanol and isopropyl alcohol, as the latter are used in pharmaceutical and disinfection products,” Doneck’s team reported.
• On March 30, 2020, Siegwerk implemented immediate surcharges on all solvent-based inks and varnishes in Europe, Middle East and Africa (EMEA).
“Certain raw materials, such as alcohol, have been impacted in terms of price and availability as a result of the novel coronavirus (COVID-19),” Siegwerk noted. “This is due to the increased need for products with disinfectant properties and the potential for government restrictions or allocation measures. Demand for these products, in particular ethanol, continues to outstrip supply, which has led to reduced global availability and rapid price increases.
“In addition, due to the industry shutdowns in China and India, disruptions to freight and logistics, and many other isolated supply disruptions, Siegwerk is not always able to avoid price increases without increased risk of supply disruption,” Siegwerk added. “Additionally, Siegwerk needs to be prepared in the event governments redirect products for medical purposes – a situation beyond the company’s control.”
• Also on March 30, 3020, Flint Group Packaging Inks Europe announced its own solvent surcharges on all solvent-based inks and coatings in Europe.
“The progressively worsening global economic situation caused by the coronavirus (COVID-19) pandemic is placing untenable pressure on the supply chain for packaging inks and coatings,” Flint Group announced. “Supply across a number of raw material categories, notably solvents, is tightening and costs are rising quickly as the market becomes more constrained. Additionally, freight constraints are resulting in higher costs across all transportation modes.”
Company officials noted that they are doing what they can. Flint Group, for example, noted that they have many employees who have been impacted by coronavirus.
“The worsening global situation caused by COVID-19 is having a significant impact on our business, yet our facilities continue to deliver consistent output despite major supply chain disruptions," said Kim Melander, VP and GM Packaging Inks Europe. "However, this output comes at a significant cost which to date we have borne alone. We remain optimistic that this surcharge is a temporary measure – we continue to monitor the situation closely and will stay in regular contact with our customers to discuss any further developments.”
Siegwerk emphasized the importance of the ink industry in our everyday lives.
“In order to ensure the continued supply of Siegwerk products, in every country in which we operate we have secured, or are in the process of securing, the official governmental confirmation of being part of the critical infrastructure industry as a key supplier to the food and pharma segments,” said Mike van Breugel, director global purchasing for Siegwerk. "Critical infrastructure industries have a special responsibility to maintain normal operations to deliver specific products associated with the safe distribution of food and medical products."
While Sun Chemical, Flint Group and Siegwerk noted that these price increases are being put in place for Europe, It would be surprising if they did not extend into the rest of the world eventually. It should also be noted that many other companies are undoubtedly raising their prices, but aren’t announcing the price increases. Tragically, the pandemic is continuing, and once we are finally clear, there will still be many challenges ahead.
