Raw materials costs hit US rubber parts makers

Akron, Ohio – More than 80% of US rubber product manufacturers faced an increase in raw materials pricing in 2018, a survey by the Association for Rubber Products Manufacturers (ARPM) shows.

The level – more than double that of 2017 – continued into the final quarter, with 82% of respondents reporting raw materials price increases, ARPM noted.

The high proportion of companies paying more for their materials compared to 40% for the same period in 2017, 21% in 2016 and just 5% in 2015.

For 2018 as a whole, 15% said prices remained level, compared to 58% in 2017. No respondents in either 2018 or 2017 reported a fall in pricing for raw materials for the period.

Some 31% of respondents passed the entire increase to customers. Another 22% passed 50-99% of the price increases on, and no respondents passed on 30-49%.

A total of 28% sent 1-29% of rate increases through, while 20% absorbed the price increases fully, the survey also found.

The industry is facing "a strong headwind " in terms of raw material prices, the US industry group said in a webinar about the report.

Nix concluded that if “we continue to take these increases and not pass them along to the customer for one reason or another, that doesn't bode well for business."

ERJ edit of a Rubber & Plastics News report covering a wide range of data from the ARPM survey.