SMC / BMC
Prices continue to increase / Dramatic shortage of glass fibres
According to the leader in the German market for SMC/BMC, Duroform J. Fritz GmbH & Co KG (D-56357 Miehlen), supply to customers is continuing to be a problem. Many producers simply do not have enough glass fibres to manufacture their products punctually or to deliver the total quantity. Duroform: "Since the major West European glass fibre suppliers are unable to deliver sufficient material at the moment, many SMC/BMC manufacturers are buying exotic products." According to marketing manager S. Schmidt, "some firms are even willing to pay excessive prices for materials which they would not have even tested six months ago."
Under these market conditions, securing the basic amount required is extraordinarily difficult. In the event that the tight market situation continues into April, Schmidt expects SMC customers to be put on allocation. Already, delivery dates of 8 to 12 weeks are being quoted. It is no surprise that in such a market situation, prices are increasing significantly. Following the first price rises in December and January, Schmidt is forecasting a further increase in April on the order of 7 to 10%. A third price increase cannot be ruled out in summer; a great deal will depend on the availability of raw materials. Duroform suggests that this is not the time to grumble, but that customers should get long term commitments from their SMC/BMC suppliers in terms of quantities and delivery dates. It is not to be expected that the supply situation will ease up rapidly. On the contrary, "the current order book suggests that demand will still hold up during the summer and that supplies will remain tight."
This situation has another unfavourable effect on the GRP industry: The excellent volume growth seen since the autumn of 1994 is being slowed down, and in certain areas brought to a complete standstill. This is grist to the mill for those people who justify their exorbitant price rises for plastic raw materials with the need to generate sufficient funds for capacity increases. However, have they thought about the effect it will have on the market? What will the economy be like then? How many plastics processors – and how many plastics applications – will survive that long?
Under these market conditions, securing the basic amount required is extraordinarily difficult. In the event that the tight market situation continues into April, Schmidt expects SMC customers to be put on allocation. Already, delivery dates of 8 to 12 weeks are being quoted. It is no surprise that in such a market situation, prices are increasing significantly. Following the first price rises in December and January, Schmidt is forecasting a further increase in April on the order of 7 to 10%. A third price increase cannot be ruled out in summer; a great deal will depend on the availability of raw materials. Duroform suggests that this is not the time to grumble, but that customers should get long term commitments from their SMC/BMC suppliers in terms of quantities and delivery dates. It is not to be expected that the supply situation will ease up rapidly. On the contrary, "the current order book suggests that demand will still hold up during the summer and that supplies will remain tight."
This situation has another unfavourable effect on the GRP industry: The excellent volume growth seen since the autumn of 1994 is being slowed down, and in certain areas brought to a complete standstill. This is grist to the mill for those people who justify their exorbitant price rises for plastic raw materials with the need to generate sufficient funds for capacity increases. However, have they thought about the effect it will have on the market? What will the economy be like then? How many plastics processors – and how many plastics applications – will survive that long?
31.03.1995 Plasteurope.com [20851]
Published on 31.03.1995