7 supply chain challenges facing the rubber industry

If you want to know the one topic on everyone's mind at the ACS Rubber Division's International Elastomer Conference, that's easy: continued supply chain woes.

Virtually every company, no matter what it is supplying and where it falls on the supply chain, are impacted in one way or another. And the worst part? There doesn't appear to be an end in sight.

Here's just a few snippets from what they were saying on the expo floor. And watch in an upcoming issue of Rubber News for a more in-depth report.

1: Get a jump on things
Sumitomo Chemical Advanced Technologies is a producer of resorcinol, and they seemed to be in better shape than many when it comes to meeting customer needs. It has plants in Japan, but the firm got on top of the situation early this year, according to Tony Da Cunha, sales manager for energy and functional chemicals.

"Traditionally we would bring our product in through certain ports on the West Coast. We started looking at alternative ports on East Coast," he said, adding that it also considered getting material from sister plants in Europe. "For the most part, we have been able to meet obligations."

The firm has had some issues getting materials for its laboratory, said Mike Walkup, director of resorcinol resins and polymer technology.

"We've had a lot of reshuffling of priorities," he said. "We make sure we get something done, it's just not in the order we're hoping."

2: Look at other options
Getting containers to bring materials from overseas still is a struggle for suppliers, said David Luevano, who works in purchasing at PTE Compounding de Mexico S.A. "This is causing a lot of delays," he said.

Another problem is EPDM suppliers that are shutting down lines, as that is one of the main synthetic rubbers PTE works with. The firm, to date, has been able to meet customer demand. "We're making a lot of developments so they can substitute these materials," he said. "You have to look at other options to meet customer requirement.

3: Computer chip shortage an issue
The shortage of computer chips is causing major issues for machinery maker French Oil Machinery Co., said Jason McDaniel, the firm's president and chief operating officer. It's made it difficult to get PLC components for the presses it supplies to rubber product makers, and impacts other electronics as well.

Some delivery times have been a few weeks, while others have been months. "We have no control over it, so it's a lot of communications with the vendors," he said. "(Customers) know what's going on, and there's an understanding, but no one's happy. That's the issue. They have production to run and they need the machines, and we can't supply those machines. And others can't either."

4: Size matters
Barwell Global USA supplies rubber processing machinery produced by its parent company's facility in China. Shipping costs have become a slight issue, and delivery times have been extended, but one of the big problems is getting a spot on ships for machinery of the size that the firm supplies, said Ian Turner, vice president of sales and services.

Barwell has a couple companies it deals with that have helped it keep delivery close to promised times. And that has helped because business has been strong this year, particularly from May on.

"We're trying to automate more because a lot more customers are looking for systems that can be operated with fewer personnel," Turner said.

5: Pricing concerns compound problems
When COVID-19 hit, many thought industry would go down, so they stopped producing materials, said Doug Moon, applications manager for ITW Pro Brands, a producer of water-based mold release agents.

"When that didn't happen, everybody came up short, and demand is above supply, so everybody wanted to raise their prices," he said.

For the most part, though, ITW has been able to meet supply. "There has been some delays," Moon said. "We haven't shorted too many, but we've had to jump through a lot of hoops to maintain on-time supply.

"Everyone was hoping it would ease up by now. But it's an ongoing issue and we're fighting hard to maintain our customers to get them what they need."

6: Think outside the box
Desma USA Inc., a supplier of injection molding presses, also has had problems sourcing microchips, but it has worked on getting multiple sources for the tough-to-get parts.

To remain viable, many companies needed to think outside the box, and Desma was no different, pre-ordering scarce electronic chips used in its machines.

"We are certainly in a unique situation right now," said Desma USA President Scott Early. "There is activity in the market, which is good, and we keep several machines in stock. But it has been difficult to get the chips."

Desma will look to be creative with its supply line by maintaining a multiple-supplier philosophy for microchips—the only way, Desma said, to keep the crucial, tiny part available.

7: 'Everything's screwed up'
Brian Chapman, general manager of Kuraray America Inc. is blunt in his assessment of the current state of the synthetic rubber supply chain problems: "All raw materials and logistics are just totally screwed up," he said.

It takes two- to three-times longer to bring in materials from the Pacific region, and pricing of materials is triple what it was in some cases.

"It's been a struggle," he said. "The issue was already present before the freeze in the Gulf Coast, but after the freeze (it) just got worse."

Business has remained strong, which is good, except that Kuraray can't recover all it's costs.

"Competition is strong, so it's hard to raise prices," Chapman said. "Plus our customers' competition is strong, so downstream prices are low."

The time to get materials to the U.S. can be months, because there are issues at every point in the shipping process. "I don't know when it's going to fix itself. I think it's going to take awhile," he said.

Andrew Schunk, Rubber News staff, contributed to this report.