The pandemic has caused a global shortage and supply volatility for raw materials throughout the world, most notably, solvents and alcohols.
The supply, which had been previously limited due to an increased demand for ethanol fuel, continues to narrow as the coronavirus causes a further uptick in demand for pharmaceutical and sanitized products. Global availability is decreasing, resulting in increased prices.
Due to these market conditions, Sun Chemical has accepted higher prices to secure its supply for the coming months. There is always a risk that governments may seize the materials to accommodate a health emergency, which would be out of Sun Chemical’s control.
Sun Chemical is working diligently to mitigate rising costs by reviewing and updating internal improvement programs and by maintaining very close communication with its suppliers and industry associations to ensure it is fully aligned to the latest procurement situation. Also, Sun Chemical is evaluating alternative solutions for suppliers and materials and is working with its technical team to provide unparalleled support for customers. The surcharges will last until the situation normalizes.
“As raw materials see greater demand and the supply chain experiences increasing costs, we, unfortunately, have to pass along part of these price increases to our solvent-based inks and varnishes,” said Fernando Tavara, president, Sun Chemical Latin America. “However, we continue to work closely with our partners throughout the supply chain to manage materials and limit the effect on our customers within the coming months.”
This follows surcharges affecting its solvent liquid inks in Europe, effective April 1, 2020.
Additionally, Sun Chemical will dollarize all ink product lines offered in Latin America, including solvent- and water-based inks.