Market pressures that began in 2014 continue for SABIC’s Ultem polyetherimide (PEI) and are expected to last through all of 2016.
One plastics processor told The Molding Blog that SABIC is hiking prices close to $1 per pound and setting a floor of $10 per pound for the high-heat resin manufactured at plants in Mt. Vernon, Indiana, and Cartagena, Spain.
“(SABIC) will be testing the market as we move forward in time, raising prices along the way to see what companies are willing to pay. Our customers are furious,” the buyer said. Customers are removing Ultem from future projects “and are in the midst of qualifying other materials.”
Plastics News reports the current price of PEI (GP- injection molding) at $8.80 per pound for less that truckload quantities (2,000 to 4,000 pounds). Prices for large-volume customers are reported by PN at $8 per pound.
According to the buyer, the biggest squeeze is on the smaller customers. He said that the price release level (5,100 pounds) is being adjusted to meet the minimum price level, which is $10 per pound.
Another buyer told The Molding Blog: “We are hearing similar stories from our factories. We have seen the supply side ease dramatically, and the only change from a year ago is the pricing. Lead time on resins and amounts available are all quite good right now.”
When the market pressures for Ultem first surfaced in late 2014 they were tied to work that was taking place on the plants in Indiana and Spain. SABIC told The Molding Blog at the time that the greatest issue was the rising global demand for the high-heat resin as it continued to find new applications in medical, automotive, aerospace and other markets.
PEI, which is only manufactured by SABIC, is described as an amorphous, amber-to-transparent plastic that has lower impact strength and thermal properties than PEEK. It has natural flame resistance and a glass transition temperature of 217 °C.
GE Plastics introduced Ultem PEI in the 1980s. SABIC bought GE Plastics in 2007 and renamed the business SABIC Innovative Plastics. The Innovative Plastics business unit was dissolved late last year in a cost-saving move.
Qualifying a replacement for PEI is difficult considering its mix of properties, ranging from excellent dimensional stability to chemical resistance. RTP, a compounder based on Winona, Minnesota, has developed potential application-specific replacements based on amorphous sulfone resins based and semicrystalline materials such as PEEK.
SABIC had no comment on this report.