Printing Ink Raw Materials Supply Issues Continues to Pressure Ink Industry

Commodity and resin prices continue to be dramatically higher than a year ago. There doesn’t appear to be any relief anticipated in the near term although a few of the supply disruptions have been alleviated.  Volatility has been the norm as supply remains snug in many areas and market speculation continues to drive very dynamic commercial behaviors.  The supply of many critical raw materials and feedstock’s continues to be constrained due to operational, market, and weather related issues. The drivers for these supply issues were the same factors we were challenged with in 2010, increased demand from developing markets, feedstock volatility, supply disruptions, and environmental and regulatory constraints in India and China.  These dynamics will most likely continue to a degree through 2012.  Due to demand, the recent cost reduction of crude had almost no effect on the fundamental cost structures.  For example, carbon black with growth in the tire markets and pigments due to shortages of some key intermediates and pressure of environmental costs in India and interest charges in China.  [Read more….]

 

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