Throughout 2021, silicone material suppliers have struggled to meet deadlines for promised delivery dates. Currently, our suppliers have lead times surpassing 18 weeks, and pricing is up over 55% to date. Last week, we received the last of our clear silicone for the year, which was over eight weeks late and not enough to clear even half of our backorders.
This crunch comes as the result of a unique combination of factors. Material shortages, a lack of alternative suppliers, and one of the largest chemical producers in the world experiencing extreme manufacturing disruptions.
Dow Chemical, the global leader in silicone material supply and the only active North American acetoxy silicone material producer, closed its ordering schedule in late fall due to the extreme backlog of orders resulting from material shortages and two severe equipment failure events.
As a result, we have all been experiencing heavy silicone supply disruptions. Our TruSil 100 line of products are now facing lead times of over two months, in addition to existing backorders.
In the wake of this extreme imbalance between demand and supply, Dow has communicated that prices in Q1 of 2022 will double. With cautious optimism, Everkem has secured our place in line for what has become the most expensive commoditized sealant chemistry in the construction and industrial markets.
We are continuing to explore additional product solutions as we ‘hurry up and wait’ to see if our order is delivered in late January, as was promised. In the interim, we recommend keeping your options open for alternative silicone suppliers for the upcoming months.
We appreciate your partnership and depend on your business. Still, we value our commitment to serving you more, even if it means losing an order or two to a competitor. For those who do not have alternative suppliers, we will do our best to recommend or partner with some of our friendly competitors to offer offset brands when possible. Contact your Everkem Diversified Products sales representative or customer service representative for additional information.
Please keep us posted on what you are experiencing in the market. Your experiences and feedback are vital in helping us navigate through this supply shortage. Thank you very much for your patience and understanding. We truly appreciate your partnership and continued investment of trust in us.