Polyester Resin Coat Prices Continue Rising

News From: Products Finishing,

Posted on: 6/14/2011

Continuing escalation of feedstock prices has resulted in a number of powder coating resin price increases over the last year.

Continuing escalation of feedstock prices has resulted in a number of powder coating resin price increases over the last year. A recent report by DSM Resins outlined upward price pressure on most raw materials due to tight markets and rising feedstock costs.

According to DSM, supply tightness is due to strengthening markets and plant closures and planned and unplanned shutdowns. Strong domestic and global demand has kept supply of neopentyl glycol (NPG) feedstock tight. In addition, a major U.S. producer has had two significant shutdowns totaling about eight weeks this year. Primary feedstock propylene has increased in cost by about 60 percent since the third quarter of 2010, and NPG producers were able to recoup only part of these costs with first-quarter price increases on NPG. Despite additional increases in the second quarter, the gap between NPG and propylene price increases continues to be large. Continued tight supply plus lost margins in the first and second quarters are likely to cause producers to seek further increases in the third quarter, the company says.

Purified terephthalic acid (PTA) and paraxylene (PX) saw a strong surge in prices through April, but an unexpected drop in Asian demand helped break that trend in May, according to DSM. Planned and unplanned outages in North America, Asia and Europe have led to global supply problems. Current forecasts indicate somewhat lower prices in upcoming months, but costs are expected to remain on a high level.

Both U.S. suppliers of purified isophthalic acid (PIA) have implemented a strict sales allocation due to market tightness; and one will be importing Asian materials to cover contracted U.S. volumes, DSM says. Feedstock meta-xylene costs have increased by more than 60 percent this year, and two other factors continue to put upward pressure on PIA prices: global capacity of PIA is decreasing, and additional volume will be taken out during 2011, the company says.

DSM expects supply availability to continue to be a global concern in 2011 throughout the chemical industry. 

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