Dear Customer and Valued Vinavil Partner,
As you probably know the entire petrochemical industry is struggling with an overwhelming number of operational problems. At the end of last year, the first issues started to arise in the propylene supply chain, creating shortages for amongst others acrylate monomers. Early this year more incidents occurred, increasing the number of force-majeures in an already stressed market. In February an unprecedented winter storm hit Texas, taking out the heart the US petrochemical industry for weeks. USA is an important element in the European chemical supply chain, especially for VAM, and even today not all plants are fully operational yet. This combination of events resulted into a global shortage of petrochemical materials and rapidly increasing prices.
Vinavil is doing all its possible efforts to source all raw materials needed. We will protect our existing customer base by not accepting potentially attractive offers from new prospects. But we need to urge you not to speculate by ordering beyond your historical needs. Due to the tight supply chain, we will be faced with delivery delays to our factories, this means that we may ask some flexibility from you.
This global shortage also leads to rapidly increasing prices, up to unimaginable levels. To protect ourselves from heavy losses, we see no other option than to adjust our sales prices to this new market condition. Given the size of the crisis our complete product range is impacted. Your Vinavil Account Manager will contact you in the coming days to agree on prices and availability.
Based on what we know today, assuming no more disasters will occur, we believe we may have reached the bottom of this crisis, as in Texas supply is starting to recover slowly. Without further setbacks, it is expected that it will take approximately 2-3 months to get back to a stable supply situation, as it takes time restore the supply chain and for the product to arrive in Europe.
Vinavil strongly believes that together we will manage to come out from this adverse chemical environment. Please trust that we will do our best to help all of you loyal customers and friends.
