In the context of foam, we have experienced surging costs on this raw material, we are particularly concerned at the impact on products such as cot mattresses (Nursery) where there is a clear impact on product performance as suppliers look to alternatives compositions such as polyester fibre pads.
We ask if any of the BRC members in the Buying Community are experiencing this in their supply chains and what their reaction is?
Yes we are experiencing it, this was due to chemical shortages/plant shutdowns in Europe.
We have had to accept short term cost price increases in some cases and/or substitute substrates.
All foam suppliers are understood to be passing on increased production costs for finished furniture and bedding manufacturers after a significant rise in the cost of the chemicals that make up the foam recipe. This is due to huge price increases in its raw material (Polyols & Isocyanates). Given their amplitude and suddenness manufacturers feel they have no choice but pass them through immediately to its customers.
This issue will affect all products containing foam, but the issues also stretches to other components affecting furniture:
The British Furniture Manufacturers comments:
“The squeeze in supply in both the foam and particleboards markets has possibly been exacerbated by a post-lockdown spike in demand for furniture. Our members are consistently reporting shortages as foam suppliers struggle to access chemical feedstocks, principally TDI*.
“The main block suppliers just about managed to meet industry demand in September but have now advised of ongoing chemical shortages in October. Factories are being put on reduced allocations of foam block, which is affecting production capacity in the critical pre-Christmas delivery period.
“Furthermore, and as a result of these shortages, prices have been increasing and most factories are now discussing a third price increase in a few months. Cumulative increases are typically +25% and given that foam is one of the biggest costs in furniture production, factories will need to pass on price increases to customers.
“The cabinet sector is also reporting significant shortages of medium density fibreboard (MDF) and melamine faced chipboard (MFC), as many European suppliers of MFC have withdrawn from the UK market due to the uncertainties of Brexit.
“The lack of materials means manufacturers are now working on an allocations basis and can currently only access around 75% of pre-Covid purchases. As particleboard suppliers raise their prices, factory gate prices are also set to rise.”
TDI*: The acronym TDI stands for toluene diisocyanate. TDI is one of the principal ingredients used in the production of flexible polyurethane foams.