The supply chain disruptions caused by the deep freeze along the Gulf Coast in mid-February are easing a little, but there are still substantial distribution delays. Supply tends to fall well short of demand.
In the last week, ASC (Adhesive and Sealant Council) President Bill Allmond talked with a half-dozen ASC manufacturer representatives of various sizes about this ongoing challenge. Here's a rundown of what they said:
The availability and supply of chemical intermediates for adhesive manufacturing has improved slowly, according to all of them. There is a lot of variation; acrylates and vinyl acetate (monomers and polymers) are still taking a long time. Propylene oxides and acrylate monomers are being produced again, but some, such as acrylate polymers, are either on allocation or due to force majeure. Ethylene vinyl acetate, methylene diphenyl isocyanate, and methylenediphenyl diisocyanate are among the other raw materials in short supply, though some say that polyurethane quality has improved.
During this unprecedented crisis, manufacturers have largely been able to keep their clients supplied. Some have resorted to importing raw materials from Asia and other parts of the world in order to sustain their supply. Others, as part of their procurement policy, source raw materials domestically in places other than the Gulf Coast, reducing the effects of the disruption.
Overall, supplier contact about their recovery has been good or is getting better, particularly with those who are vital to a manufacturer's product lines. However, depending on the supplier, there is some variation. Some manufacturers stated that they demand more timely information from suppliers than they are getting, while recognizing that suppliers might not be receiving timely information from their suppliers, resulting in a domino effect.
Logistics has become a major challenge for all manufacturers. Owing to high demand and a lack of available freight carriers, truck drivers, containers, boats, and even pallets, packaging and distribution times are pushed out significantly, depending on the content. Most manufacturers believe that supply chains will not completely recover until at least the third quarter of this year, if not longer.
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