Average price increase per raw material type versus May 2020
The British Coating Federation reports that while the news media has concentrated on a small increase in consumer price inflation the impact of sharply higher raw material prices in the paint and coatings industry is on a completely different scale of magnitude. With raw materials accounting for about 50% of all costs within the industry the inevitable knock-on effect for our customers is likely to be considerable.
Higher prices for a range of critical solvents are just one area of concern for paint and ink manufacturers with higher prices for resins, some pigments, extenders, and packaging also causing major problems for manufacturers.
For solvents, the latest statistics for May 2021 show some prices up by two-and-a -half times on the levels of this time last year. For example, N-Butyl Acetate prices were 258% higher than a year ago with N-Butanol up 248%, MIBK 212% higher and Methoxy Propyl Acetate up 189%.
For pigments, price increases were much less steep but even so 7 of our 9 materials showed increases with Pigment Green 7 up 13% on this time last year and Red Iron Oxide Micronised 11% higher.
For extenders, the median price for Silica Matting Agent surged 58% on a year ago while Talc AT1 type was up 10%.
All packaging items in our basket showed higher prices than a year ago with 205 litre drums seeing the biggest increases of about 20%. 5 litre round tins were 15% higher over the last year.
In terms of the wider measure of producer prices for our sector of paints and printing inks the ONS's index was 9.1% higher in May and has now risen steadily over the last 6 months in common with the equivalent indices on input prices for UK manufacturing as a whole and the chemical sector. Both are up about 10% on a year ago in stark contrast to the widely publicised index for UK consumer inflation which remains just 2% higher.
The impact of these price increases differs across the industry due to the mix of raw material types and their use in each sector. On a weighted average basis, we estimate raw material prices for paints and coatings to have increased by 15-35% in the last year. Unfortunately, availability issues to continue throughout the rest of 2021.